First Person: How Covid is changing people and businesses around the world

The Financial Times’ live coronavirus blog explores the impact of the pandemic on people, businesses and communities everywhere in a series that tells some of these stories

By Miles paves way for motor insurance overhaul

Oliver Ralph

James Blackham’s idea that car insurance should be based on distance driven, rather than a flat annual premium, helped give birth to By Miles in 2017.

But he lacked a catalyst to convince motorists that pay-by-the-mile motor insurance would work. That is, until the coronavirus pandemic struck 15 months ago.

Suddenly the idea hit home: drivers were stranded in their neighbourhoods for months, paying insurance premiums on cars that were sitting switched off on driveways. By Miles customers, by contrast, paid only when they used their vehicles.

“The product started to work as we intended it to,” says the company’s co-founder. “Suddenly the product made sense to a much wider spectrum of people”, and customers came running.

Sales in March more than doubled — a 150 per cent rise — from a year earlier. “We hadn’t expected that kind of level of growth,” he says.

By Miles drove the message home with radio and television advertising and sponsored a series of travel documentaries, a move away from posters that start-ups usually depend on to get their message across. 

The pandemic offered “a great opportunity if you could move fast”, Blackham says, since it kept at bay many potential TV advertisers, especially in the travel industry. That in turn left the door open for By Miles. 

Nevertheless, the pandemic has created challenges for the start-up. The initial Covid-19 outbreak forced the company to delay a funding round just as it was on the cusp of completing it. Plus less driving pushed premiums lower, which hit revenue growth.

But Blackham says that the crisis has allowed By Miles to prove that the concept works.

The UK industry “moves very very slowly”, he says, adding that he would consider his model a success only when the “whole country has moved to usage-based car insurance. We’re not expecting a transformation overnight.”

G Page Flowers looks to rosier times as love of nature flourishes

Mamta Badkar in New York

Last March, G Page Wholesale Flowers in Manhattan pulled down its shutters along with New York’s other non-essential businesses and left stems wrapped in brown paper on the footpath for passers-by.

More than a year later, owner Gary Page is upbeat as he looks forward to rosier times, even as sales at his flower business are about half of what they were before the coronavirus pandemic struck.

People are swarming to his store in search of peonies, ranunculuses and calla lilies and he believes the pandemic has turned more people towards nature. He projects a return to pre-pandemic levels by early next year.

“If everyone is comfortable with large indoor gatherings”, he says, by the autumn “we should be off and running. Wearing my optimistic hat, it may be early 2022 [that] we are back up to 2019 levels.”

Page, who has been in the industry since 1984, says the Covid-19 pandemic kept his flower district shop closed for three months and is the worst crisis his business has faced, even tougher than the September 11 2001 terror attacks and the 2008-9 financial crash. For wholesalers like him, who primarily sell to luxury florists such as Miho and Ovando and rely on hospitality events, business looked grim last year. 

He credits the Paycheck Protection Program, the US government’s pandemic-relief loans for small companies, with getting his business through the worst of the pandemic via two tranches of $168,000 loans.

His business struggled as costs shot up. The pandemic made it more expensive to bring flowers to the US as international flights were mostly grounded.

Flowers from France and Italy could be sent by road to the Netherlands and then shipped from there, but it was harder to bring in blooms from Malaysia and Thailand. That led to a surge in freight costs that he had to pass on to his customers.

Still, Page says demand has blossomed and more people have appreciated nature, especially those city dwellers who felt stuck indoors, and he sees this as a post-pandemic legacy that will flourish. 

“We had the industrial revolution, which took us off the agrarian land,” he says. “Now we have the technological revolution where we have become separated from what is around us.”

He thinks the disconnect, which was heightened by the pandemic, led people to spruce their homes up with more plants and flowers that “can create such emotion in people” and have been a counterweight to loneliness. 

And these purchases in turn have created educated consumers who can distinguish the quality of flowers and make more informed purchases.

“There’s the Men’s Wearhouse suit and there’s the Brioni suit,” Page says. 

North Dakota oil boomtown on the comeback trail

Matthew Rocco

Between the energy price crash and the pandemic, the oil boomtown of Williston, North Dakota, hit a particularly rough patch early last year.

“There was nothing great to say about 2020,” said Shawn Wenko, executive director of economic development for Williston.

But with the US turning a corner in its fight against Covid-19, things are looking up. “It was probably the busiest first quarter I’ve seen in terms of working with businesses in the 13 years I’ve been in economic development,” Wenko said.

Williston grew rapidly as energy producers flocked to the Bakken oilfield, which rose to prominence during the US shale boom. The city’s population surged 82 per cent between 2010 and 2019, according to the US Census Bureau.

Wenko spent his days in the early part of the pandemic working on a “patch and maintain strategy” to help keep local businesses from being lost for good.

Now he’s fielding requests from people looking for more information about the area and its economic prospects. Interest is high among businesses and entrepreneurs working on carbon capture technology and ways to reuse the byproducts of energy production.

“We’re setting ourselves up for the next boom,” Wenko said.

He also expects the restaurant and retail sector to “take off,” noting that Williston has been on the cusp of attracting more businesses to the area. There’s also a new hospital and clinic from Sanford Health in the works, in addition to the development of the Vantis Network, a statewide system for operating drones.

He has noticed a bit of a pick-up in hiring in the energy sector, mostly on the service side of the industry.

“It’s going to take a little bit of time to get out of this thing,” Wenko said of the pandemic-fuelled downturn, “but things are looking better than I thought they would.

“We weathered the storm much better. It’s a more positive outlook than what it could have been.”

Shift towards casual wear suits formal retailer

OLIVER RALPH

For office staff a switch to working from home prompted a swift change to a more casual style of dress: out went the formal wear; in came the tracksuits. Traditional retailers however have struggled to be as nimble to meet the demand.

The move to joggers and elasticated waists prompted a change of tactics for UK-based menswear retailer Charles Tyrwhitt. But, facing supply lead times of as much as a year, the company, known for its shirts, suits and ties, was unable to flip what it had on its shelves as quickly as it would have liked.

It took some time to stock enough of the casual loungewear that its customers want, but nonetheless the range is now “flying off the shelves”, says Nick Wheeler, who founded the business as a mail order retailer 35 years ago.

The Covid-19 crisis prompted the business overnight to think about the growing popularity of casual wear — and not before time, said Wheeler.

The business realised it had to offer its clients at least 50 per cent casualwear rather than 80 per cent of its products being formal wear. Still it had to ensure the clothes were “fit for purpose and a range that people really wanted to wear”, the founder said.

“Pretty quickly it became obvious that what had been a general trend over the past 10 years was going to become — at least in the short term — a greatly increased trend,” he said. “We’d been a bit slow with that trend over the last 20 years. We’d become a bit lazy.”

The formalwear retailer ordered casual shirts and sweaters but the lag from suppliers around the world meant Charles Tyrwhitt had containers full of suits arriving in June and July, four months after its customers had started working from home.

“Whatever happens, men will always wear clothes, I hope,” he said. “We’re now running at 50/50 formal/casual and I think that’s a pretty good balance, especially if people do go back three days a week. I think people will be more relaxed at work.”

Door-to-door retailer reels in sales as he whets home diners’ appetite for luxury fish

Sarah Provan

Andy Knapton has been selling fish from his van in Cambridgeshire for the best part of 20 years but has never seen such demand for the produce he brings south from Grimsby, a trend that has pushed him to tilt his business more towards his retail customers over the past 12 months.

The pandemic and Brexit have collided to propel Knapton’s sales higher over the past year: more people are at home to take his call while interest has escalated in fish and domestically supplied produce.

On the other hand, his sales to wholesale customers such as restaurants and bars have tumbled during Covid-19 lockdowns.

Knapton has generated a steady increase in sales since he began trading in 1992 but last year demand went through the roof and sales rose 50 per cent, he said.

“I haven’t got the time to increase my wholesale customers,” he said. “Margins are so tight and it takes so much time to serve them. Just the retail customers are enough plus retail is more profitable percentagewise.”

Knapton’s sales have risen by nearly a half in the year to November 2020, with gross profit up 55 per cent, while he has served about 53 per cent more houses in the past 12 months as his clients spend more time in the kitchen.

He is working harder than before though — to 70 hours per week in the past 12 months, from 55 before March last year.

In pre-pandemic times, one-fifth of his sales came from the wholesale trade, such as restaurants and pubs. That has dropped to as little as 1 per cent because of coronavirus-induced lockdowns.

The shift from wholesale to retail has not been the only change caused by the pandemic. Covid-19 hygiene demands prompted the director of AK Fisheries to use a card reader rather than rely on cheques, cash or online payments, a tweak to his business that has eased payments and helped generate more sales.

“I resisted it for so long since the charges are so high,” he said, “but Covid forced me to switch away from cash and cheques to contactless payments. It’s been good for business.”