One virus, infection spreading rate high, human beings clueless, and it results in chaos – Pandemic brought everything to a stand-still. Over the past two years, the world economy is wobbling and struggling to bounce back. There are several challenges for business during the pandemic. These include loss of market, governmental restrictions, struggles with logistics, poor connectivity with clients, shutdowns of manufacturing units, and more.
One of the renowned survey agencies identified the four significant areas of challenges during a pandemic by the business:
- Revenue: More than 30% of business is suffering revenue challenge, and more than 45% of the businesses (SMBs) are struggling to pay their employees due to revenue reduction.
- Contingencies: Any business is full of unforeseen situations, and unfortunately, more than 10% of the small companies are battling this condition.
- Zero expertise: 1 in 10 companies (large and small) are facing the biggest challenge of zero financial advice during the pandemic. Lacking the know-how of money can mess the entire business operations.
- Capital issues: No business can start without capital and assets. It is one of the combating points for many SMBs during the covid situation. Almost 8% of the medium-scale companies were found suffering from a lack of assets to sustain themselves amidst these uncertainties.
Major findings based on the study
- The impact differs from industry to industry: Pandemic severely affected the small and large businesses that call for human interactions during the pandemic. On the contrary, smaller agencies like childcare, online food delivery, and pharmacies picked up their businesses. The hospitality industry was the biggest hit, and some even succumbed to the pandemic.
- Adaptation and sustainability initiated: Most businesses found their way to adapt to the dynamic market to correct their economic condition. The retail business started online options, fitness companies switched to application-based classes, and dining patrons opted for curbside pickups – these are some examples of adaption that were apparent in these recent years.
- Rework on expenses: Businesses have understood that it is imperative to reduce the costs to increase the margin of profit or sometimes break even. Reduction in more than 60% of the marketing and advertising expenses, 40% of the payroll adjustments by laying off workforce, and nearly 20% of the companies opted out from insurance to save some.
- Government loans: Dependency on government aids and loans are increasing for staying afloat in a slumping economy. Paycheck Protection Program is one such important government initiative, opted by several small and medium businesses. Some companies also declared insolvency to liquidate some assets and pay off the debts.
Conclusion
After almost a year or so of combating the dynamic economy, more businesses have adapted alternative methods to do business with more vigor and optimism. There are a lot of challenges ahead. It is significant to identify core areas that need improvement. It is essential to stay connected with customers. With the right combination of strategies, businesses can sail through these difficult times.