Updated: 2 days ago
The covid-19 virus was first detected in China, now it spreads worldwide in less than 100 days only. Today more than 180 countries are under the effect of lock-down or some short of restrictions just because of this virus only. Research says one-third of the total population is locked into their houses with some form of restrictions under the fear of the coronavirus.
Coronavirus affected more than world war I.
Almost every country around the world is trying every possible measure to slow down the spread of the coronavirus from lockdown to national quarantines. The world health organization has already officially announced covid-19, a world pandemic. More than 2 lakh people have died and over 29 lakh people have been infected by the coronavirus world widely. During this lockdown, citizens are only allowed to leave their homes only for the essential requirement or in case of any emergency only.
The effect of coronavirus is more than the effect of first and second world wars which are fought by a combined total of around 135 million. In 1940, the world population is around 2.3 billion which is less than the population living under the impact of lock-down today.
This virus is more deadly among the other viruses like SARS and MERS.
SARS infected around 8000 of the total people in 26 countries and killed nearly 9% of the total among them. Whereas MERS infected around 1000 people among 24 countries and killed around 30% of the total infected population.
The sad reality about the novel coronavirus is that it is continued to spread quickly and there is no vaccine or proper treatment available on market. Scientists around the globe are trying to develop vaccines but it is not likely that one will be available for mass distribution before 2021.
So, the question that comes to everyone’s mind is that what will happen to our business after this Coronavirus pandemic.
With the growing number of cases and rising fear among the public, it would not be wrong to say that the worst is yet to come. Coronavirus not only impacted the health of individuals but it everyone’s earnings, it not only took the life of individuals but it is going to take uncountable jobs, it will shut down many businesses.
No one knows how much time it will take to contain this virus globally but what we know, it crashes the global stock market which means fund flow will be extremely affected. When the stock market collapse it means investors tend to move their investments towards safe zones which in most cases is gold. Lack of investment will raise to decrease the possibility of business expansions which will decrease the employment rate.
A low fund flow rate means people will start to boycott non-essential items.
Impact of Coronavirus on Chinese economy
This virus was started in China, so it is important to understand what happened with china after lock-down due to the coronavirus. The first impact of the business slowdown was also faced by China only. Although China alone contributes about 16% of the total world economy and is also a world power after lockdown due to coronavirus-
· Chinese industrial output decreased by 13.5%.
· Chinese overall sales output decreased by 20.5%.
· Chinese overall employment rate decreased by 13.5%.
· The most affected business due to coronavirus is tour and travel based which faced around 95% drop rate.
· No traveling means transportation business will also decline, which results in 3 out of 4 companies reported temporary shutdown.
· Automobile and component-based industries also reporting around 80-85% drop in sales.
· Chinese fixed asset investments fall to 24.5%, down from 5.4% growth.
· Growth in service production decreased by 13%.
· Chinese gross domestic products decreased by 13.5%
Whereas officials in Beijing attempted to put a positive spin on numbers, saying the impact was temporary.
Impact of corona on Apple Inc.
Big companies are also facing sales drop due to fear and lock-down like Apple Inc. started to reveal its losses throughout the world due to lack of production and sales drop due to which Apple is shutting down its sales offices globally like in china apple had shut down its 42 sales store and 4 in India as well.
As per Apple their work is being resumed but experiencing a slower return rate to the normal condition than they expected.
Impact of coronavirus on Indian economy
In India business initially shifted from work from home to complete lockdown. It is expected that under complete lockdown within 3 months of India's Rs 182 lakh crores ($2.8 trillion) economy is functional. India expected to lose over Rs 32,000 crore ($4.5 billion) every day during the lockdown.
According to the survey, COVID-19 will impact Indian businesses to a great extent, every industry is expecting de-growth into their sale and other operations which results in their next step will be cost-cutting by a reduction in manpower which will create huge unemployment.
Over 25% of India's 6.9 crore micro, small and medium enterprises (MSMEs) may close down by the end of lockdown. The immediate challenge of MSMEs after lockdown will be to pay their statutory dues, wages, pressing creditors, and bank dues. They are set to face an acute cash crunch due to a sharp fall in business and operational challenges with low or zero manpower over the next few weeks since migrant workers are fleeing to their hometowns.
Ravi Venkatesan, chairman, Global Alliance for Mass Entrepreneurship (GAME) has said that 19% to 43% of the MSMEs may disappear till the end of these crises.
There will be two major problems the country will face after lockdown are labor migration and sales
One of the biggest problems for Indian companies after lockdown will be the migration of manpower. Due to shut down and fear among laborers leads to migrate them to their home town.
Most of the workers belong to villages and traveled to the cities in search of work earlier but after the administration announced to shut down of all train lines and bus routes the fear of shortage of daily need food requirements among leads them to walk to their home towns. Many of them will find it very difficult to get back to the city they work in after lockdown.
Due to a shortage of workers, most of the companies will not be able to restart their work at full production capacity. This flow will take a long time to become normal.
For any organization, the biggest challenge will be business continuity. Experts say companies with short payment cycles (like start-ups and mostly MSMEs) and having high debt levels are facing big challenges. So the most important thing now an organization need is capital. The basic source of generating this capital for MSMEs is to generate sales as most don’t have options of generating investment or bank loans.
But the sad reality we all need to face in the coming future is that we all are going to lose customers along the way. Simply because they can’t afford to continue paying for our company’s services as they are also facing the same issues.
Uncertainty over the lockdown has made a business impossible to predict business impact. So, most business owners are only looking to slashed their expenses as much as possible.
The most impacted areas will be airlines, hoteliers, transport, restaurant, and tour operation as there is a high chance of spreading viral infection due to these businesses and people are trying as low as possible to use these services.
But like they say, the one-man loss is another man gain and it is true in this case as well. Some industries are also there which are having benefits of this viral infection like online food deliveries, online retailing business, and other kinds of contact-less delivery services.
We had created a panel of experts to understand the upcoming crises for every business due to the coronavirus. So, feel free to write us comments, maybe our expert team can provide you some methods to sustain your business growth also don’t forget to subscribe to us with your mail-id.
In the last we would like to advise everyone that business is all for us, we are not born to do business, so stay at home as long as possible and during lock-down be warned, be prepared and most important be hopeful.
Read more about the impact of coronavirus on Lighting industries