How COVID-19 is affecting Businesses and What Can You to Protect Yours?
Coronavirus pandemic has shaken the whole world to its core. From toilet paper hoarding to panic grocery shopping, the outbreak is impacting our lives in dramatic ways. Schools are shut, sports leagues are suspended and now, businesses are on the brink to shut their doors.
Giant firms are doing whatever they can to facilitate the public. A great example is set by . It’s offering free Internet for students for 60 days so that students from low-income households can continue learning from home.
A Brief Overview of Coronavirus
It all started in Wuhan City, China on 31st December when several cases of Pneumonia were reported. A week later, Chinese authorities confirmed the identification of a new virus calling it the 2019 Novel Coronavirus. Now, we know it by the name COVID-19. The ones suffering from it show symptoms such as fatigue, high temperature, coughing, and difficulty breathing.
The virus is spreading from person to person. Initially, the outbreak was only in China, now, it has spread globally. On March 11th, WHO declared the outbreak to be pandemic. 2 days after that, the global financial markets crashed. At the same time, the Italian government imposed a national quarantine on the entire country.
COVID-19’s Impact of the US Economy and Financial Market
Globally, the airline industry has lost $29 billion. The downward trend of the global financial market indicates that the world economy may be set on a path to recession. Since the Chinese economy has shut down, it is taking a toll on US manufacturers. They heavily rely on China for products.
Apple has outsourced most of its manufacturing facilities to China and they have been affected by the closure. The Trump Administration has imposed travel restrictions because of which the tourism industry has taken a huge dip.
Banks and financial instructions might restrict and reprice credit because it’s getting harder to assess short terms risks to borrowers. And with less credit availability, businesses will struggle to invest and grow. For potential home buyers, finding a mortgage will not be easier either.
How to Protect Your Business?
Here are a few things every business can do right now to stay safe and continue their operations:
Communicate With Your Staff
Many employees would be concerned about their health and how to continue working as more and more things are shutting down.
Update them on what COVID-19 is along with preventive measures. Educate them on how to monitor oneself for the disease. Encourage handwashing and social distancing procedures. If there are any travel plans, cancel them.
Invest In Work from Technology
Most people have phones, computers and Internet connections to continue working from home. However, not all have enough bandwidth to do the kind of work they do at the office at home. In such a case, it’s the responsibility of the company to provide the necessary work from home technology to allow remote work.
Apart from arranging Wi-Fi services, to keep productivity intact, use collaborative tools like Google docs, hangouts, sheets and other alternatives.
Have a Business Contingency Plan in Place
At this point, a lot of companies have planned for a crisis. You should too. A good plan covers many things including a procedure to work from home, how to handle travel, meetings, etc.
The plan must also include insurance coverage for business closures or trip cancellations, supply chain alternatives, alternative lines of credit for business and so on.
Service businesses might continue operating but movie theaters, restaurants, and similar companies have to think harder on managing cash flows and salaries of their staff if people stop going out. There should always be a plan B in place in case your current business model might not work anymore.
Communicate With Your Stakeholders
Another important thing is holding honest communication with your suppliers and customers. Here are some tips:
If there are delays in product delivery, let your customers know.
The outbreak might create a scenario making it difficult to meet the loan commitments. In such a case, renegotiate the terms with your bank or the payment terms with your suppliers.
Review all your debtors. If possible offer discounts for early payment.
It’s hard not to get affected by this pandemic. But survival is possible with a viable contingency plan. As most of us would be working from home, I have encouraged my employees to call and upgrade the speed of their plans in case it’s not enough. My company will be bearing that expense. Arrangements like these are necessary to stay in business and face the odds.