Robert Voerman talks about how the COVID-19 pandemic has affected his business what the future possibly holds
We first realised we had a problem in mid-March. The government put a lockdown in place on Sunday night and we had to quickly work out how to get everyone working from home. Of course, home working works better for some than others, so we had to work out what was best for each individual, As we have experience with working from home in our offices in Eastern Europe & Africa we were able to switch quickly to this new way of working in The Netherlands. Key has been the technology of RedSky which enables us to all work from home.
In some ways we were fortunate in that The Netherlands remained quite open throughout the pandemic. Our own strategy has been to operate around the globe with diversified services in multiple countries. This to spread the risk for the Group. COVID-19 was unique as it affected us globally. The moving industry continued in The Netherlands and we were even able to operate in countries that were closed to their own industry including France, Italy, and Spain, even during the crisis. But we are a move management company that derives around 80% of its business directly from corporations. We knew the lockdown would have a serious effect and even with the freedoms we had, business has been significantly down throughout the period and I don’t expect it to come back quickly. We are hoping for a late summer, but we don’t expect it to be more than 70-80% of normal. The big corporations are not going to be moving people around the world again for a while.
What we are living through will, in my opinion, spark a fundamental change in our industry. We will never go back to business as usual, and maybe that’s a good thing. The industry was already drifting towards a more digital approach and I am now sure that this will accelerate. This means that there will be casualties amongst those companies that prefer to provide a traditional service, but those that embrace technology will give themselves a much better chance of survival. Stand-alone companies don’t have a bright future in my opinion as we need to work integrated with our customers, IT systems, supply chain and colleagues. The airline model has always been the drive for change in the last 10 years in my company and we only believe this will accelerate in time to come.
Perhaps we have all taken our eyes off the environmental issue, but that has not gone away; in fact, I think it will come back even stronger in the future. In the past we have all paid ‘lip service’ to protecting the environment; now I think it will become much more intense particularly as people have had a taste of the improvements, particularly in air quality, that can be achieved relatively quickly, when you have the will. We will launch a global initiative on this in quarter 3 this year around block-chain technology.
Staff and customer safety
So too with health and safety issues that have become more prominent now that we all have an additional threat to manage. We have a duty of care to our employees and we must make sure that we handle that seriously otherwise we will be at risk of laying ourselves open to huge problems in the future.
We are all going to have to look more carefully at our credit control if we are to remain financially secure. Moving companies will have no choice but to demand faster payment from their corporate clients than they are achieving now. It is unfair and unsustainable for small businesses to be financing big corporations. This must not be allowed to continue. In the past we were worried about losing the business, but that’s just not an option now. Some RMCs are going to be in a difficult position as well. They will need to look at their value proposition as some of them are struggling anyway.
Standardisation and technology
The moving industry is already moving towards greater standardisation and we saw an initiative between IAM, FIDI and OMNI last year to work out how this could work. I think this too needs to accelerate and it will need the associations to come together to make it happen. I think COVID-19 has brought the “Uberization” of the industry one step closer and this standardisation, if it can be achieved, will be a significant factor in making sure the established moving industry retains the business. That said, I believe we will need to move towards a more tailored service where each customer gets the level of service they want and for which they are prepared to pay. Companies will have to decide where, in the market, they want to be and what service levels they wish to offer. Exactly like the airline industry is organized.
We have all seen a rise in the use of video conferencing, which has, I believe, proved its worth. It’s now mainstream. That may put the relevance of the traditional conference scene in jeopardy in the future as people feel less need to meet in person. More imminently, the risks and cost of air fares are likely to reduce the level of travel we are all prepared to do. Conferences worldwide may well be hit and, if they are, our trade associations will quickly need to re-assess their value propositions to ensure they stay relevant. Having said that I do believe Voerman staff will be travelling as we need to be out to meet our (prospective) customers and develop new services & business.
Commercially, there will be winners and losers from this pandemic. Those companies that invest in technology, and make sure that they are sufficiently agile to manoeuvre, will do best. We need to make use of the time we have to take advantage of this opportunity. We do believe there will be more losers than winners due to the current state of the industry (i.e. not capitalized & united enough). Those networks that create a bigger efficiency to reduce cost and create a higher customer and employee experience will be the winners of tomorrow
For example, we have been focusing on extensive training during the quiet period and have been speeding up IT projects. This is also a great time to make sure you have the right people in the right place. Some of our staff have really stepped up in the crisis and it’s been an opportunity for them to show off their skills and work ethic.
It’s sad that it has taken a tragedy such as COVID-19 to wake us up, but I think in many ways it has and, with hard work, innovation and a little courage, our businesses and our industry will emerge stronger from the experience.