{"id":6531,"date":"2020-12-09T07:08:25","date_gmt":"2020-12-09T07:08:25","guid":{"rendered":"https:\/\/berg-software.com\/?p=6531"},"modified":"2020-12-09T07:40:07","modified_gmt":"2020-12-09T07:40:07","slug":"2020-review-business-landscape","status":"publish","type":"post","link":"https:\/\/www.berg-software.com\/en\/2020-review-business-landscape\/","title":{"rendered":"2020 Review (1\/2): The Business Landscape"},"content":{"rendered":"

[et_pb_section fb_built=”1″ fullwidth=”on” _builder_version=”4.4.1″][et_pb_fullwidth_post_title meta=”off” featured_placement=”background” _builder_version=”4.6.6″ title_font=”||||||||” title_text_color=”#ff6317″ title_font_size=”3.5em” meta_font=”|300|||||||” meta_text_color=”#ffffff” meta_font_size=”1em” background_enable_color=”off” use_background_color_gradient=”on” background_color_gradient_start=”rgba(248,248,248,0.85)” background_color_gradient_end=”rgba(248,248,248,0.75)” background_color_gradient_overlays_image=”on” min_height=”20vh” height=”400px” custom_padding=”6vh||6vh||false|false” global_module=”403″ locked=”off”][\/et_pb_fullwidth_post_title][\/et_pb_section][et_pb_section fb_built=”1″ admin_label=”intro” _builder_version=”4.4.6″ custom_padding=”|||0px||” locked=”off”][et_pb_row use_custom_gutter=”on” _builder_version=”4.4.6″ custom_margin=”||||false|false” custom_padding=”6vh||||false|false” border_color_left=”rgba(0,0,0,0)”][et_pb_column type=”4_4″ _builder_version=”4.4.1″][et_pb_text _builder_version=”4.6.6″ text_font=”|300|||||||” text_font_size=”1.1em” text_line_height=”1.6em” quote_font=”|700|||||||” quote_text_align=”left” quote_font_size=”16px” header_2_text_color=”#ff6317″ header_2_font_size=”1.5em” header_2_line_height=”0.9em” header_3_font_size=”23px” header_4_font=”||||||||” header_4_font_size=”16px” header_4_line_height=”1.5em” header_5_font_size=”14px” custom_margin=”||||false|false” custom_padding=”||||false|false” border_color_left=”#ff6317″]<\/p>\n

As 2020 is drawing to a close, we\u2019re looking back into how business and technology changed during the last year. For this article, let\u2019s see what the dynamic of different industrial sectors was and what\u2019s in store for 2021; then next week, we\u2019ll look into how technologies evolved.<\/p>\n

First of all, there\u2019s no denying that for a majority of industries\/companies, pretty much across the globe, 2020 was bad. For others, the crisis propelled them into very strong, sometimes monopolistic, positions.<\/p>\n

The big differentiator? Whether people (as in employees, consumers, social beings) would get more value by staying shoulder-to-shoulder, or shoulder-to-couch.<\/strong><\/p>\n

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The 2020 business landscape<\/h2>\n

So, let\u2019s take a broader, global-wide picture first: in a September 2020 document, OECD \u201cprojects global GDP to fall by 4.5% this year, before growing by 5% in 2021\u201d. [source<\/a>] Apparently, this is less bad than previous projections, due to bigger economies (China, US) not being as hard hit as expected.<\/p>\n

Back in Europe, the two biggest economies were not spared either.<\/p>\n

In France, both sales volumes and margins appear to have dived -19% during the first semester of 2020, compared to the same period of 2019. [source<\/a>]<\/p>\n

In Germany, according to a recent L\u00fcnendonk study, 57% of the B2B service companies expect a decline in sales. [source<\/a>] Although bad, this is a positive correction compared to a March survey showing that 89% of companies were expecting a negative sales trend.<\/p>\n

What about the other 43% of German B2B businesses? A part of them (16%) see stagnation, and the rest (27%) actually expect to grow during 2020. The expected winners? Tax consultants and auditors, facility service companies, and IT companies. But then, during the last few years, Germany has seen a lack of skilled personnel \u2013 which also will have an impact on any future recovery.[\/et_pb_text][\/et_pb_column][et_pb_column type=”1_2″ _builder_version=”4.4.1″][et_pb_image src=”\/\/cdn.berg-software.com\/wp-content\/uploads\/Berg-Software-GDP-fall-in-2020-growth-in-2021.jpg” alt=”Berg Software – GDP fall in 2020 growth in 2021″ title_text=”Berg Software – GDP fall in 2020 growth in 2021″ _builder_version=”4.6.6″ custom_padding=”4vh|||2vw|false|false”][\/et_pb_image][\/et_pb_column][\/et_pb_row][\/et_pb_section][et_pb_section fb_built=”1″ admin_label=”intro” _builder_version=”4.4.6″ custom_padding=”|||0px||” locked=”off”][et_pb_row column_structure=”1_2,1_2″ use_custom_gutter=”on” _builder_version=”4.4.6″ custom_margin=”||||false|false” custom_padding=”6vh||||false|false” border_color_left=”rgba(0,0,0,0)”][et_pb_column type=”1_2″ _builder_version=”4.4.1″][et_pb_text _builder_version=”4.6.6″ text_font=”|300|||||||” text_font_size=”1.1em” text_line_height=”1.6em” quote_font=”|700|||||||” quote_text_align=”left” quote_font_size=”16px” header_2_text_color=”#ff6317″ header_2_font_size=”1.5em” header_2_line_height=”0.9em” header_3_font_size=”23px” header_4_font=”||||||||” header_4_font_size=”16px” header_4_line_height=”1.5em” header_5_font_size=”14px” custom_margin=”||||false|false” custom_padding=”||||false|false” border_color_left=”#ff6317″]<\/p>\n

Declining industries<\/h2>\n

If people spending time together was the basis of an industry\u2019s success, then the chances are that that industry is going down. The biggest victims:<\/p>\n

Travel and tourism<\/strong> (e.g. airlines, cruises): between February and April, air traffic declined between 80-90%, with a very slow recovery during the following months. Although 2021 might be better, nobody really expects travel to reach pre-2020 levels very soon.<\/p>\n

Commercial real estate<\/strong> (i.e. offices): although painful at first, businesses got to discover the benefits of working from home. Most probably, WFH is here to stay, to only increase the inventory of unoccupied commercial real estate.<\/p>\n

Traditional (in-person) retail and entertainment<\/strong>: since basic things like shopping, dining, sports-supporting and karaoke-ing are not possible anymore, we see more companies struggling or even shutting down (e.g. Zara<\/a>, Debenhams<\/a>).<\/p>\n

[\/et_pb_text][\/et_pb_column][et_pb_column type=”1_2″ _builder_version=”4.4.1″][et_pb_image src=”\/\/cdn.berg-software.com\/wp-content\/uploads\/Berg-Software-Air-traffic-demand-decline-by-region.jpg” alt=”Berg Software – Air traffic demand decline by region” title_text=”Berg Software – Air traffic demand decline by region” _builder_version=”4.6.6″ custom_padding=”4vh|||2vw|false|false”][\/et_pb_image][et_pb_text _builder_version=”4.6.6″ _module_preset=”default”]<\/p>\n

[source<\/a>]<\/p>\n

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In-between sectors<\/h2>\n

For other industries, however, it is not that bad (although not necessarily good either):<\/p>\n

Healthcare<\/strong> should be an obvious winner, but it\u2019s rather mixed. Traditional healthcare service providers faced reduced traffic (\u201cyou don\u2019t really need a knee scan right now, do you?\u201d). Health equipment manufacturers could not cope with higher demand and reduced personnel. But then, telemedicine is on the rise: better communication and information access for medical personnel (e.g. \u201cconnected hospitals and devices\u201d) are on the rise, together with highly accurate consumer-grade sensors coupled to self-diagnosis platforms.<\/p>\n

Manufacturing<\/strong> initially dropped, then recovered as main players switched production from less-essential goods (think automotive and luxury bags) to virus-fighting (e.g. surgical masks, hand sanitizers, respiratory ventilators).<\/p>\n

Education<\/strong> does struggle to move from a full-in-person setup to a total or partial online mode \u2013 a hard topic, especially for primary education. But then, universities seem to be on the right track to offering good online alternatives. Last but not least, when it comes to technical education, companies like Google start offering their own programs and certifications. (See Google Grow<\/a>, currently available only to US prospects, but expected to get a broader footprint as of 2021.)[\/et_pb_text][\/et_pb_column][\/et_pb_row][et_pb_row use_custom_gutter=”on” _builder_version=”4.4.6″ custom_margin=”||||false|false” custom_padding=”6vh||||false|false” border_color_left=”rgba(0,0,0,0)”][et_pb_column type=”4_4″ _builder_version=”4.4.1″][et_pb_text _builder_version=”4.6.6″ text_font=”|300|||||||” text_font_size=”1.1em” text_line_height=”1.6em” quote_font=”|700|||||||” quote_text_align=”left” quote_font_size=”16px” header_2_text_color=”#ff6317″ header_2_font_size=”1.5em” header_2_line_height=”0.9em” header_3_font_size=”23px” header_4_font=”||||||||” header_4_font_size=”16px” header_4_line_height=”1.5em” header_5_font_size=”14px” custom_margin=”||||false|false” custom_padding=”||||false|false” border_color_left=”#ff6317″]<\/p>\n

\u201cAnd the winners are\u201d<\/h2>\n

So, if the one variable determining success in 2020 is whether you can support people staying at home, then things are pretty straightforward, and the winners are:<\/p>\n

Remote communications and work<\/strong>: since everyone zooms these days, Zoom\u2019s shares\u2019 price increased 500% y.o.y. during 2020. In comparison, Slack\u2019s 100% y.o.y. increase doesn\u2019t seem as impressive, but still\u2026 All competitors, such as Webex or Microsoft\u2019s Skype and Teams, have all seen major upticks.<\/p>\n

Ecommerce and logistics\/delivery<\/strong> are a no-brainer: with traditional retail made inaccessible, someone has to provide. Amazon is the huge elephant in the room, adding hundreds of thousands of jobs to keep up with the demand. Besides it, some traditional retailers were quick to adapt their operations to support mostly online sales. But then, Shopify\u2019s platform (growing 10x in three years) democratizes e-commerce by providing access to millions of small shops and entrepreneurs. And everyone lifts the logistics\/delivery companies in the process.<\/p>\n

Online entertainment<\/strong> has something to offer for everyone: whether you\u2019re on Netflix, Amazon Prime, or Disney+ (or all?), you\u2019re probably part of their increased viewership numbers. If you\u2019re into gaming, then competition between consoles (got your PS5 already?), and competition between streaming platforms is a good thing.<\/p>\n

Pharma<\/strong> will obviously benefit from helping to shut the virus out. (Yes, that\u2019s a good thing. No, we do not believe in conspiracies.) The current viral research was built on pre-existing infrastructure (e.g. research, capacity, technology), and its commercial results will probably fund the next wave of R&D, so all good.<\/p>\n

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So what are the trends?<\/h2>\n

During 2020, brutal changes in the business landscape happened in only a few months (or, in some cases, few weeks).<\/p>\n

Take remote \/ work from home: in order to get access to employees, some companies had already started hiring talent regardless of location \u2013 but it was a pretty slow trend. Then with the spring quarantine, a decade of change happened again in only two-three weeks.<\/p>\n

Take e-commerce: it took 20 years to reach 18% of the US market, then two months to 28%.
Which brings us (again) to Amazon: it needed 20 years to reach 500k employees, then one year to the next 500k. They are also very well positioned for the current environment, with e-commerce, AWS, and entertainment (Prime) at full speed.<\/p>\n

We, therefore, think that the best descriptor is not necessarily \u201cchange\u201d, but \u201cacceleration\u201d. Many of these trends have already been in place for the last years, and the pandemics only spin them at a higher speed.<\/p>\n

We think that this acceleration can be explained by three structural trends:
1. Digitalization<\/strong>: the degree to which a company integrates digital tools and processes
2. Globalization<\/strong>: access beyond their local markets (either for sourcing\/hiring or selling)
3. Demographic change<\/strong>: building on highly specialized and highly flexible young talent, with a different set of incentives.<\/p>\n

At Berg Software, we are digitalization experts, with solid experience spanning almost three decades. With a young, highly specialized team, we build software that serves global clients \u2013 and we\u2019re looking forward to the next thirty years.<\/p>\n

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\uff3f<\/h2>\n

How do you see the 2020 business landscape? Got any experience that you can share? Let us know<\/a>!<\/p>\n

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We turn ideas into software. What is yours?<\/h5>\n

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Get in touch<\/h2>\n

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The 2020 business landscape was challenging for most businesses but rewarding for some. We look at winning and losing industries, and possible causes and trends.<\/p>\n","protected":false},"author":7,"featured_media":6545,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_et_pb_use_builder":"on","_et_pb_old_content":"","_et_gb_content_width":"2880","footnotes":""},"categories":[33],"tags":[],"class_list":["post-6531","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-insights"],"yoast_head":"\n2020 Review (1\/2): The Business Landscape | Berg Software<\/title>\n<meta name=\"description\" content=\"The 2020 business landscape was challenging for most businesses but rewarding for some. 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