What business are you in?

The coronavirus crisis has upended businesses globally. Reimagining, not tinkering, business models is the need of the hour

The ongoing coronavirus pandemic has disrupted or upen­ded most companies’ fundamental business models globally. And as the economy opens up tentatively, even as cases and fatalities refuse to move downwards, businesses can take nothing for granted — customers, demand, supply chains, work-life, et al.

That it will never be business as usual in the post-Covid world is clear, and yet many are behaving as if they just need to sit it out, tinker at the edges, and everything will be all right. Take hospitality, one of the worst hit sectors, for instance.

Two pieces of unrelated news in the last week will illustrate what can be construed as mere tinkering, lackadaisical attitude to a once-in-a-century event to have hit your business, even when opportunity knocks to fundamentally reimagine the business. Two of the country’s leading hotels chains have decided to start delivery of its restaurant meals to customers at home. Some have even opened pick-and-drop laundry service for everyone, not just hotel guests, in the city. Well, these can at best be a stop-gap arrangement to shore up hard-hit revenues, but it’s an open question whether it can really make up for the long-term business loss emanating from a change in consumer behaviour — avoiding hotel stays, meals, meetings and conferences.

The other piece of news was about a joint venture between a global investment bank subsidiary and one of the country’s biggest home mortgage firm spending hundreds of crores to acquire the student hostel facilities of a big north India-based private university. Apart from the real estate play here, what are the services being offered to the university? Rooms, housekeeping, dining and laundry. Though college campuses too are hit by the pandemic-related social-distancing norms currently, education is relatively a more inelastic demand sector as people will need to eventually restart studies, and remote learning can only be a mitigating measure for the short term.

Now if a home-loan provider with expertise in property matters can collaborate with someone with expertise in hospitality, is there an opportunity knocking hard-hit hotel chains to look out for someone with real estate bearings to partner it in such ventures? Yes, that would initially be stretching the age-old business models, but then desperate times calls for desperate measure. And if they need to look for inspiration, though from a completely different time, one of Scandinavia’s biggest hotel chains, Elite Hotels, started life servicing student dorms at the Uni­versity of Stockholm. Coincidently, the Swedish firm has an Indian-origin founder in Barun ‘Bicky’ Chakraborty. To be sure, few hoteliers are looking at alternative uses of their properties, like converting unused land around them into serviced apartments.

Consider another sector hit hard by Covid — shared mobility, the Ubers and Olas of the world. Last month Uber launched its intra-city package delivery service Uber Connect in four cities Gurgaon, Kolkata, Jaipur and Guwahati. Uber has since extended it to five more cities — New Delhi, Chandigarh, Hy­de­rabad, Chennai and Noida. Under 5 kg packages (excludes prohibited or illegal items like alcohol, firearms, recreational drugs et al) are currently transported by a two-wheeler. On the face of it, it seems Uber is just leveraging its under-utilised two-wheeler service Moto to launch what it calls the delivery marketplace. And other delivery players like Swiggy and Dunzo too have started their package service during the lockdown, but they were anyway into only goods (food, other items) delivery, though business-to-consumer, and not people mobility.

But look at it the other way. By delivering what it calls packages, Uber has smartly moved into consumer-to-consumer goods transportation. And is Connect not a courier service too? If it is a bike today, can it not be three or four-wheelers tomorrow? How about hot tiffin delivered from home to office a la  Mumbai dabbawallas? And if a two-wheeler can take 5 kg packs, surely a three- and four-wheeler can accommodate much bulkier parcels, right? Well the market and the regulator will decide what is possible and how successful this service gets, but the point is Uber seems to be at least willing to take the chance of trying to reimagine its business.