A few weeks ago, I presented a business analysis outlining how recovery from the COVID-19 pandemic would look based upon 20+ years of experience personally being involved in disaster relief operations. This is an follow-up analysis sharing details of real recovery happening now along with an updated outlook.

We are presently between the first and second stage, a time when folks are moving beyond the initial panic and fear as they begin to experience a cautious sense of relief. The world is starting to spin normally again which is a fantastic move in the right direction. This has taken slightly longer than originally anticipated as stay-at-home orders were issued which had not been widely implemented during historical disasters utilized as reference points.

Folks are beginning to get out and about again, traffic is increasing on the roads and parks are filled with people who are willing to risk leave their homes for the enjoyment of having interactions with friends and family members in safe social environments. There’s still a cautious feeling in the air with social distancing and wearing protective masks, but life is returning to the “new normal”.

Governments are slowly relaxing restrictive measures which are helping people get back to work, while businesses are hard at work to ensure safety guidelines are in place to operate responsibly. Everyone is keenly aware that failure to adhere to CDC guidelines (and common sense preventative measures) will result in a tragic relapse of this pandemic. The stakes are high and there’s no second chances to get it right, leaders are committed to making the right moves for the health and safety of others now more than ever.

So, what’s next? As I mentioned in my prior analysis, I provide expert consultation to some of the largest banks and private equity firms in the country. These deep connections have provided me insight into minds of those individuals who invest in a wide variety of industries. It is widely viewed that unlike the “U” shaped 2009 recession (two quarters of free-fall, four quarters of consistent trough recession and two quarters of recovery), this event will appear more “V” shaped in form.

The reason behind this “V” shaped view is two-fold. First, many folks such as myself who are in the driver’s seat during this pandemic are the same people who experienced (and successfully overcame) the 2009 recession. Collectively, we all moved too slowly in cutting and trimming operations back then, we acted much more swiftly this time around as we executed many painful decisions. Inversely, we are all experienced knowing the necessary recovery procedures and will implement many of the same actions learned from the past downturn as we begin to work our way out of this recession. Secondly, there’s massive amounts of money being distributed throughout the supply chain as well as directly to individuals in need. Politics aside, money is a proven driver of economic activity and there’s a lot of it beginning to flow with more expected to follow in the weeks and months ahead.

My current analysis is based upon facts versus pure speculative opinion, although none of us has a crystal ball so a healthy dose of thoughtful interpolation is necessary. I believe that we will see a negative 75%-85% decrease in many businesses for Q220. By Q320, this will be reduced to negative 30% as an anticipated 18%-30% of entities begin to fail, driving increased demand to those business who have survived. By Q420, we will recover to negative 15%, further accelerated by fewer having competitors in the marketplace. This is an important metric as folks will now be in the realm of a “known” recession environment, this is precisely the level we saw in 2009. Familiarity with being in a previously known economic environment will provide a feeling of, “We’ve got this, we know how to recover from this point.” This is the stage where projects will begin to be green-lighted and we will see business activity shift into full gear. That being said, projects and supply chains naturally take time to ramp up so we’re still several months away from truly seeing the effect of these initiates. By late Q121 to early Q221 these projects will get underway and we’ll return to the “zero” baseline, essentially the same place we begin prior to the start of the COVID-19 pandemic.

I’ve fielded more calls and e-mails than I can even count these past weeks. Interactions are filled with people reaching out who are overwhelmed and looking for hope and assurance that brighter days are ahead. My typical days are 20+ hours long and quite frankly are exhausting, yet incredibly fulfilling to be able to help others during this time of need. I continue my resolve to stay strong and confident by recognizing this entire event is just a bookmark in time in the grand scheme of life. There’s many amazing chapters still to be written as we create meaningful business and personal experiences long into the future.

I’m so incredibly proud of the care and generosity exhibited by so many people in this world during this pandemic so will conclude this update simply by saying thank you. I warms my heart and renews my faith in the goodness of the human spirit to see folks stepping up in ways beyond my imagination to help their families, friends, neighbors and loved ones. We are all walking this journey together, surrounded by everyday heroes by our sides, thank you for making the world a better place!

Godspeed to you all!

~ Brad Pierce