Key to survival of business in pandemic economy: The pivot

Mike Geller spent the better part of a decade tweaking the focus of Mike's Organic Delivery, which he founded in 2009. Early on, the model was similar to a community-supported agriculture program, or CSA, where customers agreed to receive whatever food was in season.

By the third year, the company was up to about 200 deliveries a week. Access to organic produce was more widespread and customers wanted options other than a preselected basket. So he created an online organic market, to allow people to pick the fruit, vegetables and meat that they wanted in advance.

In 2018, facing stiff competition from Peapod, FreshDirect and other online food services, he pivoted yet again, renovating part of the company's warehouse in Connecticut, and added a market a year later. Private parties, community events and cooking classes followed.

"It was a challenge to grow," Geller said. "The business hadn't reached a level I wanted to get to."

Then, this March, the stay-at-home orders in New York and Connecticut were enacted, and his business changed again. With the massive increase in demand for deliveries and shortly thereafter, pickups, it boomed in a way he never imagined nor was equipped to handle. He went from having 200 to 250 orders a week to 5,000. He also became one of the main outlets for a half-dozen farms that had been selling their meat, breads and produce to high-end restaurants, which were now closed.

"It's not that you don't want to say you're doing well," Geller said. "But myself, my whole team, we're not jumping up and down. We're just thrilled to be busy, and we're happy to be helping small farmers."

The biggest issues for many businesses is what the economy will look like when they reopen. But the companies that are surviving — some, indeed, growing, like Mike's Organic — are the ones that have pivoted, either within their existing business or to a new line of work, said Wendy Cai-Lee, president and chief executive of Piermont Bank, which lends to small and medium-sized businesses. "The ones who have a single source of revenue have more challenges," she said.

"We've picked up the slack," Geller said.

Being able to pivot and sell to companies like Mike's Organic when the restaurants closed has been a lifeline, but it hasn't been without its complications.

"On March 13, 90% of our business was restaurants," said Marc Jaffe, who owns Snowdance Farm in Livingston Manor, N.Y., which produces beef, pork, chicken and other meat. "Thank God we had some retail or we would not have had a label that was already approved by the USDA."

While Snowdance did not have to go through the time-consuming process of getting approval to sell its meat to retail customers, it did have to change its production methods. Shifting operations to retail for the providers means extra costs that make their businesses more of a break-even operation.

Tim Topi, the owner of Wave Hill Breads, a bakery based in Norwalk, Conn., lost 60% of his business when restaurants closed. He went from baking 2,000 loaves a day to 400, with the same 25-person staff to support.

The looming question is what happens when restaurants reopen and grocery shopping in a store is not such a hassle.

"You don't know what the future holds, more than ever," Geller said.