20 Jun Financial resilience in challenging times

Financial resilience in challenging times

It’s no secret that this past year has been tough on individuals – from health to finance, things have been rather challenging. But despite these turbulent times, some individuals and businesses seem to have flourished. 

Some of this can be ascribed quite simply to the changing nature of business; some businesses were favoured in a move to remote and online working. But others seem to have excelled despite hardships. 

The winners and losers

When companies fail, the reason for such failure is usually quite intricate and must often be analysed in isolation – considering the industry, local economy, company structure and so forth. It’s rare that we get a global view of sectoral or industrial failure and can point the finger at a single culprit. 

Historically such mass implosion usually highlighted some kind of political strain, shortage or sudden legislative obstructions, but in the past year and a half, the Covid-19 pandemic has been a common thread throughout most business failures. 

Locally and abroad, companies which have either filed for bankruptcy or massively downscaled operations include Edcon, J.Crew, Chuck E. Cheese, General Motors, Associate Media Publishing, Prada, Hertz and Virgin Australia. 

And yet some companies have shown rapid growth during lockdown. These include Microsoft, Apple, Tesla, Adobe, Audi, Takealot, Facebook and Amazon. While some growth was understandable – social isolation meant a higher demand for tech, home shopping and software applications – some of the success was achieved in unconventional ways. 

In South Africa and abroad, home-delivery services from food to groceries and tech seemed to pop up out of the blue. While some large tech companies flourished, the man on the street with some entrepreneurial savvy seemed to also take advantage of novel conditions to great success. One fresh produce delivery company in Cape Town was so inundated with requests for service that they had to cancel any new business three months in advance – after one month in business they’d hit the jackpot. 

And the good of it is that many clients have indicated that they would continue supporting local suppliers and artisans even after lockdown has ended. 

Risk vs reward

Amazon is another such company which applied and employed a myriad of innovations to not only keep the company afloat, but see a massive boom in its market value. Moreover, while many companies reliant on extensive warehousing, infrastructure and fleet solutions had taken an initial dip during lockdown, some of them have looked to Amazon for ways to overcome challenges. 

Among the innovations Amazon has rapidly adopted at high risk include automated employment and HR facilitation, leave and overtime flexibility, AI infection and infectability monitoring and applications and massive employment drives. 

While most companies were downscaling based on risk assessments, Amazon saw the risk and took a leap of faith. It needs stating at this point that it would be fallacious not to consider the actual money in the bank Amazon had to gamble with. Most organisations did not have the same type of fall-back should things go pear-shaped – certainly not the $4 billion Amazon had set aside to keep its logistics afloat during the pandemic.

And yet, from its early days in a garage-office, Jeff Bezos had maintained that the company ethos is bravery and innovation in the face of adversity. From July to October 2020 Amazon had taken on 350 000 workers from other industries – many of whom had been left jobless during the pandemic. Such job-creation numbers are unprecedented. The company’s stock has increased more than 60% and its profit has increased by 220% year-on-year. 

Don’t forget the people

Still, Amazon has come under fire for unfair labour practices, lack of human interaction and record-breaking employee turnovers. It seems that the greatest risk Amazon has taken in the massive expansion of their business is human faith and investment. 

Jeff Bezos is not blind to these blunders, and in a rather unprecedented move – given his lifelong dedication to innovation and efficiency over human resources – he admitted some of the company’s mistakes in this arena. In a letter to his shareholders prior to his exit as CEO, he stated that the company needs to foster a greater vision of how it can create value for employees and ensure the success of those who work for them. It would seem that even among the clinging of coins hitting his bank account by the second, the voices of the masses have made a real dent in the mogul’s armour. 

Global success – a lesson for expatriates

For many South Africans moving abroad, the pandemic has been a steep learning curve, and yet some of the lessons learnt are invaluable in ensuring success abroad. 

As with a pandemic, the risks associated with relocation out of one’s home country are hard to pinpoint and not always easy to prepare for. Starting a new life abroad rids you of those failsafe tricks and tools you’d employed back home – the things you utilised to stay afloat and excel. Though you can certainly rely on those inherent traits and intellectual tools you carry with you, starting a new life requires various leaps of faith and innovating on the fly. 

Many emigrants will tell you that the achilles heel of the global vagrant is doubt. The risks often seem far too great, and many people who move abroad find themselves mentally living with two feet on different shores. The old adage about how many eggs to keep in which basket can become a thorn in one’s side and leave you mentally and emotionally exhausted. In pursuit of new dreams abroad, our natural calls for caution don’t always apply. 

Of course, this doesn’t mean that we shouldn’t anticipate risks or be overly careless with our personal and professional decisions, but those who have left seem to tout the same universal motto: “All in!”

These lessons we’ve learnt from big corporates and economies are valuable in approaching our new lives. To be successful in your endeavours as expat, your ability to adapt your behaviours, change your course of action, anticipate new ways of life and doing business, and persist amid adversity are key. So what are our primary learnings from a global pandemic?

Key learnings for immigration from Covid:

• hold fast your values, but discard your norms
• commit yourself to learning about new technologies, industries and work methodologies and be prepared to enter new arenas
• dedicate yourself to your new life and don’t focus on the what if’s from your former life, hesitation can be detrimental to success.
• find new ways of investing, diversifying your financial portfolio and growing a passive income
• consider which industries will yield highest returns, taking into account global catastrophes, swift market change and volatile economic conditions
• harness opportunities for automation but maintain the human touch and focus on communal wellbeing for long-term prosperity

Moving abroad? 

Though emigration and immigration seem even more risky endeavours than ever before, global economic conditions and a shared worldwide focus on facing new challenges provide the perfect opportunities for taking bold steps. 

Rand Rescue is the preferred cross-border financial specialist for South African emigrants. We’ve helped thousands of South Africa navigate the tricky administration around their taxes, cross-border finance, forex and transfer.

We’re an authorised forex dealer with existing relationships with all major banks, fund administrators and tax authorities who can ensure that your plans run smoothly. 

If you’re planning on relocating abroad, talk to us about your financial concerns and needs. We won’t charge you a sent for our initial consultations and conversations and can advise you on the best course of action to ensure your financial wellbeing in your new home. 

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