In a factory in Sydney’s south, Merna Taouk is bundling up fresh crumpets which will be packed and shipped directly to someone’s doorstep.
She wears (She’s wearing) her signature headscarf, resembling the logo which adorns the packaging of her eponymous crumpet brand.
While Ms Taouk’s likeness is instantly recognisable, her business looks very different than just a few months ago, before the coronavirus pandemic turned many industries, including hospitality, on their heads.
“Before COVID-19, we were serving the food service industry mainly,” she tells ABC’s The Business.
“A large chunk of our business, about 80 per cent of it, was airlines, cafes and restaurants.”
In the early stages of the coronavirus crisis, Qantas and Virgin cancelled their orders, quickly followed by cafes as they began to close.
“We knew we had to change our business strategy because obviously there were no orders … people were trying to give stock back to us, which we couldn’t take.”
A much bigger business than Ms Taouk’s, the private equity-owned pet empire Greencross, was also aware of the early whispers of the coronavirus crisis.
“We deal with lots of suppliers in China, we have very strong supply chain partnerships there,” explains Scott Charters, the chief operating officer of Greencross’s retail business, including Petbarn stores.
“So very early on, we knew something was going on.”
As panic buying swept supermarkets and saw aisles emptied of toilet paper and food staples, Petbarn experienced an unexpected surge in demand for pet supplies.
Australians weren’t just stocking up for themselves but also their pets, with kitty litter and dog and cat food racing off the shelves.
Mr Charters says sales rose so fast, the company was concerned it’d be a short-lived spike.
“We actually thought we had a bit of a bubble on our hands. People were panicking, they were going to pantry-fill and then we’d get an associated drop at the other end, and that drop just hasn’t happened.”
He says even though sales have eased back from their peak, Petbarn’s seen 16 weeks bigger than Christmas.
‘Sink or swim’ as pandemic rocks business
Although many businesses have been crippled by coronavirus, whether from loss of customers, trading restrictions or supply issues, some have managed to thrive during the pandemic.
For Crumpets by Merna, it involved tapping into a new market as wholesale orders dried up. For Petbarn, it was about maximising a surge in demand.
Ms Taouk says as orders dropped off, there were many sleepless nights and she decided it was a case of sink or swim, with the primary aim being to keep her staff in a job.
She shares her factory with cultured butter maker Pepe Saya. The two businesses combined efforts to offer bundles delivered direct to customers, combining crumpets with condiments such as jam and maple butter.
“We needed to provide them something yummy that they could buy online, for themselves, for their loved ones,” she says.
A woman in a white apron holding a box labelled Crumpets by Merna.
Crumpets by Merna mainly sold wholesale but moving to online saw sales grow during the pandemic.(ABC News)
Both Easter and Mothers’ Day occurred relatively early in the initial shutdown and the various bundles, including bunny-shaped crumpets, took off.
Social media advertising played a big role in attracting new customers.
Ms Taouk says previously, she was lucky to get maybe 20 orders a week through her website. Over the Easter week, there were more than 1,400 orders.
“That was really surprising for us, so our sales were a lot more than what they were with just wholesale.”
At Petbarn, as sales rose, attention turned to managing stock and dealing with supply chain disruptions.
Mr Charters says they source pet food and treats from within Australia, which minimised supply issues on that front, but other items caused headaches.
“The company that was making puppy pads were forced by the government to make masks for humans, so we just had to deal with that, manage that — have we got the stock sitting in the right place at the right time?” he says.
For goods sourced from overseas, the lead times on imports increased from weeks to months as air freight became less frequent due to fewer flights.
“We have a buying office in Shanghai, so we’re able to talk to suppliers and if we cant get that fabric, let’s get a different one,” he says.
“What you realise very quickly is it’s not just that one factory, it’s their supply chain, it’s their ability to get on to a container ship.”
To minimise contact between staff and customers amid the health crisis, Petbarn rolled out contactless click and collect and, in partnership with Uber, same-day delivery, to keep sales momentum going beyond initial panic buying.
Seeking comfort food and companionship
While he hates the phrase “the new normal”, Mr Charters expects that’s what this is for Petbarn, which will continue offering the new services to online shoppers.
“I just don’t see how we can go back to doing things the way we used to,” he says.
It’s a new normal as well for Ms Taouk — once the initial phase of restrictions had lifted, the back-end of her website was given an overhaul, to streamline the process of inputting customer delivery information.
“We’ve seen how successful it’s been and I think people have changed the way they do their shopping these days, even with restrictions lifted,” she says.
“I think a lot more people want to support local businesses and small businesses.”
As Australians adapted to staying at home and being separated from friends and family, some sought comfort food in the form of crumpets. Others turned to a furry companion.
Just in New South Wales, the RSPCA saw a 30 per cent increase in successful pet adoptions in April.
Mr Charters chairs the Petbarn Foundation, which has donated pet food and care packages to owners struggling during the pandemic and runs cat adoptions through Petbarn stores.
He wasn’t surprised that people staying at home led to increased pet ownership, noting the business performed similarly well during the global financial crisis.
What did surprise him was the surge in sales of items such as fish tanks, indicating that people weren’t just seeking companionship, but also updating their homes.
Mr Charters acknowledges the business’s good fortune at being in the right sector at the right time.
“Unfortunately, the flipside is businesses that have lost a lot of customers overnight, and I think that’s the really sad bit,” he says.
“We happen to be lucky on the side where people want to engage more, spend more and understand that having a pet in their lives is a really good thing.”
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Source: ABC News
