At the beginning of 2020, many businesses were projected to hit their all-time high. With E-Commerce projected to hit $4.206 trillion in 2020.
Now, fast forward to the end of the first quarter of 2020 and the mainstream of the businesses around the globe are facing indefinite lockdown.
While e-Commerce and the likes of it continued, the vast bulk of businesses around the globe were shut down completely. That would change later, but by the beginning of March, Forbes was already predicting an economic downfall on the horizon.
However, the story goes far beyond that.
With many small and medium enterprises at threat, many employers faced the threat of not only laying off their workers but also losing a majority of their businesses.
Harsh decisions and necessary precautions became a must as a huge number struggled to cope with it in the first few days. So, just how big of an impact has Covid-19 had on businesses in the past 10 months or so? Let us find out.
How It Began
What you simply call “Coronavirus” is basically just the surface of a vast family of viruses.
WebMD describes the variety of coronaviruses and makes it clear that the one that we know as COvid-19 is the strain called SARS-CoV-2 in scientific terms.
In the first week of December 2019, Chinese authorities reported the strain of symptoms found in some patients from Wuhan. Which is why doctors believe that much like other strains of these viruses, like MERS, this one originated from bats as well.
Wuhan, the capital of Hubei province is known for its live food-markets, is widely believed to be the origin of Covid-19.
However, aside from the nature of this virus, it made a serious impact on the world less than 3 months into 2020.
By the end of March 2020, the majority of the world had reported at least one case of Coronavirus with WHO officially recognizing Europe as the centre of the pandemic.
Impact Of Early Lockdowns
In March of 2020, not only did the cases began soaring around the globe, the pace at which many of the countries shut down and went into a lockdown rose as well.
With no hopes of a vaccine any time soon, the majority of the governments had to make the harsh decisions and implement strict lockdown measures.
However, the inflicting of these rules was only beginning and by the last week of March, a lot of Americans had filed for unemployment benefits. However, the few industries that suffered the most were:
- Travel & tourism
- Brick & Mortar stores
- Fresh & livestock markets
- Oil & Petroleum
- Cars & Automobile
However, industries like eCommerce and online marketing were quick to shift their proceedings and work remotely.
However, by June of 2020, some countries had already suffered a breakdown in the economy.
Not only did some countries like Italy & China lose 95% of their tourism earnings, but the shutting of local businesses also put the economy at a halt.
First Response From Businesses
Now that businesses had to lay-off a lot their employees, with Italy and France leading the way by 29% and 41% each.
Hiring rate also saw a major decline as a lot of the wheels had stopped turning.
Yet, some of the businesses saw it as an opportunity. With the new normal on the horizon, many small and medium businesses did not only take their shop and go remote but also preferred it over physical businesses.
There is a good reason behind that. Because by the end of 2019, e-Commerce and online marketing were already poised to take over as one of the leading business types.
But, not all businesses were able to benefit from it.
Now, an online marketing or app development company can benefit from this, but a restaurant or food-chain supply does not have much of a choice.
So, the vast numbers of food stores started offering order take-away. Much like that, clothes and grocery supply offered home deliveries with minimal contact.
While for some it kept the wheel moving, others struggled to adapt. Yet, the pace of the projected move towards online business was quickened by the pandemic.
Moreover, online services like Netflix saw 16 million new sign-ups because of lockdown restrictions.
How Major Businesses Coped With It
As is the nature of businesses around the globe, the more money you have, the better chance of survival you possess. Same is the case with major businesses.
While a lot of them saw a downward spiral in sales and profits, a lot of them dealt with it properly. As mentioned above, companies like Netflix saw soaring sign-up rates.
But, because of people having to find other measures of entertainment, so did things like computers, gaming consoles, mobile phones etc.
But, eCommerce once again led the way, reports are Amazon made $401 billion during the first half of 2020. Some of the industries that saw a hike in their sales are:
- Computers & gaming
- Streaming & entertainment
- Technology and gadgets
- Gym and sports equipment
The VPN indusrty has seen a major hike as Work From Home culture is widely adopted throughout the World. While the last one may seem out of order, but it is true.
Many of the people, who could not attend sports or partake in athletic events, had to stay inside. So, staying in shape was naturally one of the priorities and it soared the sales of gym equipment, as well as athletic wear and footwear.
What Did Smaller Businesses Do?
So, major businesses had the money and the niche to cope with it. Where do small businesses stand then? Are they as fortunate as their major competitors?
The answer is not everyone as fortunate because more than 3 million business owners had fallen back in 3 months, from February to April of 2020 alone.
However, while it was a major drawback for many businesses, some saw it as an opportunity. A few industries proved to be most promising for smaller businesses including:
- Frozen & fast food supply
- Clothing and apparel
- Mobile phones & technology
So, one of the many reasons that some of the small businesses thrived in recent times is the growing demand for the above-mentioned things.
There was always going to be a hike in demand for frozen food and food supply. Finding clothing and apparel was impossible on physical stores, so, online stores came in as a saviour for many.
Mobile phones and tech are always in demand in modern times, and their sales hiked up as well.
Covid-19 Causing An Epic Economic Downfall
Despite the fact that both major and smaller businesses managed to bode with the problems well so far, there is still an economic downfall around the globe.
With many countries facing odds they have never before. It is almost 35% higher than the 2008-09 global economic troubles.
Not only does that mean that smaller economies suffered, but also the countries who do not have many trades or exports.
However, the problem does not end there. With many new possibilities about the virus, investors are on the edge about many businesses as well.
Moreover, suffering economies around the globe are not only stumbling global business and trade but also proving it difficult to continue without international or allied aid.
What Can Businesses Do In The New Normal?
Now that this is the new normal, what are businesses supposed to do then?
Considering that dealing with it so far has been trouble, there must be a way out of it?
Let us examine what we know so far. Experts project that 2021 is going to be no different.
While there are vaccines on the horizon, so are new Coronavirus strains. So, if the virus mutates, the vaccines would be rendered useless.
Which is one of the things businesses must prepare themselves. What they can do is:
- Prefer online business over physical
- Improve social media profiles
- Employ internet marketing
- Better usage of technology
- Invest in delivery and take-aways
One of the many things that people have learned in the past year or so is that feature belongs to the online market.
Now, the jarring responsibility that e-Commerce businesses have had during the past year, which they have met for the most part.
So, if a business wishes to survive these trying times, then the best bet they have is to make sure they focus on working through online means.
Improving their presence on online mediums is also a viable bet.
Whereas employing technology and offering home-deliveries is always going to be a profitable investment in the new norm, even after a vaccine is provided.