Every news channel and social media platform is buzzing with updates on the recent global pandemic that has hit the world.
The coronavirus outbreak was first detected in China and began to spread rapidly in all other parts of the world, killing thousands of people in its wake.
Although the latest statistics show that the pandemic is slowing down, the outbreak is still with us, most importantly on businesses and the world’s economy. May countries remain in full-lockdown mode and work is still stagnant in some places since people are being fired, laid off and furloughed.
Effect on Global Shares
Although recovery seems to be in sight, shares have suffered a massive hit, followed by major shifts in the stock markets. Most of these markets have experienced some of the biggest downfalls ever since the pandemic began on 31st December 2019.
London’s FTSE and The Dow Jones Industrial Average, for instance, have witnessed their biggest quarterly drops since 1987.
In an effort to slow down the growth of the virus, most of the activities have come to a halt, which is the main factor that has caused such huge drops in the global shares.
According to economists, the global economy will suffer bigger hits in the upcoming days at the hands of coronavirus.
Industries Impacted by Coronavirus
When you talk about the economic impact of a global pandemic, it is essential to consider its effects on the industries of the world.
It has been found out that two of the biggest industries to have been impacted by this outbreak are the hotel and travel industries. This is due to hundreds of travel cancellations, low consumer demand, closure of many bars and restaurants, and low consumer confidence, to name a few.
Hotels in the United States, for instance, are facing unprecedented booking cancellations as a result of which millions of hotel employees can end up losing their jobs in the upcoming weeks.
On top of that, the virus has literally slammed the US travel industry, where experts are predicting that it can possibly wipe out more than $10 billion that would typically come from Chinese visitors.
Closure of Factories in China
The coronavirus first emerged in China, where the sales and investment, along with industrial production, fell the most during the first three months of this year.
Although the US government is looking to make some fundamental changes regarding global trade, one simply can’t ignore that China is currently among the world’s largest exporter of numerous goods, and it makes up almost a third of global manufacturing. This suggests that the consequences of the decline in industries and closure of factories in China isn’t just restricted to that country, but have impacted industries, exports, and imports of all other countries of the world as well.
The supply chain of large companies has also experienced a great hit, such as carmaker Nissan. This has led to a massive drop in Chinese car sales in March by almost 48 percent.
Assessing the Impact of Coronavirus Outbreak on Your Business
When a global situation such as this one hits the entire world, someone running a business or an organization needs to assess the impact and effects on their business model not just in the current times, but also in the long run. You need to be able to identify the different kinds of risks and opportunities, if any, being presented by the crisis at hand.
There are four major things that you need to consider first:
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- Customers of your business
- Business capabilities
- Value demonstrations
- Value propositions
These are the core dimensions of any model if you are to recover from such difficult consequences at all in the future.
The next thing to do is align these four elements and figure out where you stand. Think about how changes across one dimension can be aligned with the other three.
For instance, if you own a restaurant, you probably lose a lot of customers because of the lockdown. But if you know that people love eating your food, wouldn’t you want to transition your business in a way that you can still cater to them and bring your customers back?
In this particular example, the transition would be to start offering deliveries and takeaways, as so many restaurants have already been doing.
It is important to understand that the crises is surely challenging and complex, but it’s not just all about risks and difficulties. It also has to do with numerous opportunities being created along the way.
At the end of the day, if circumstances continue to persist the way they are right now, businesses will have to find a way to make adjustments and resume to normalcy.
What’s Next?
Considering the way that the virus continues to escalate, it’s really hard to predict the future for economies and businesses all around the world. However, one can assume that digital transformations will be at the forefront, and the use of technology will be used more now than ever.
The changes in the post-pandemic world will obviously be both negative and positive, and there will be some business fall out, but slowly and gradually, things, people and processes will pick up the pace in the near future.