The whole world has been rocked by the COVID 19 pandemic, and the virus’s impact on businesses around the globe has been monumental. Whether you run a Fortune 500 corporation or a small business on Main Street, USA, your company will be irrevocably changed by this virus. The business implications of COVID 19 are far-reaching, and may not be entirely realized for years to come.
Here are fifteen ways that businesses have been affected.
-
Weakened Global Economy
Even before the pandemic, there were signs that the global economy was slowing down. When the deadly virus started to spread, it hit the world economy hard.
Stock markets have been wildly volatile, reflecting a decline in investor confidence. This depresses the economy as a whole, affecting your ability to obtain credit, expand operations, and plan for the future.
-
Weakened Local Economy
Local economies have been hit as well. Often the level of seriousness depends on the degree to which the virus has sickened that particular region or city.
Vast numbers of people are applying for unemployment, testing the capacities of state budgets.
People have stopped spending on all but the essentials because they have lost their jobs and are worried about the basics like food and electricity.
As discussed in this video, in states like Texas, local businesses are eager to reopen because of the dire effect that mass closures have had on the economy.
-
Reduced Consumer Spending
So many small retail establishments have suffered in the wake of the pandemic because they simply do not have customers. Many have had to close due to government shelter-in-place orders.
Even stores that remain open have seen a sharp decline in consumer spending. People are reluctant to spend on activities like amusement parks, concerts, or shopping which might expose them to the virus. They are afraid to spend money on big-ticket items like cars or trips when employment prospects are bleak.
When stores can’t make sales, they can’t make rent. That affects the landlords and real estate developers. Many businesses have been forced to close temporarily, with no idea of when they might be able to reopen.
-
Supply Chain Disruption
Businesses of all sizes depend on each other to produce goods and get them where they need to go. Fear of the coronavirus has disrupted the global supply chain, delaying shipments and resulting in higher prices.
Large agricultural operations and small farms have been terribly damaged by these supply chain disruptions. With fears of contaminated food, food plants closed down, delaying deliveries. Many animals have been slaughtered, and many crops have had to be destroyed because farmers can’t get the products where they need to go.
-
Need for Layoffs
Employers struggling to pay rent or make mortgage payments have to make some tough decisions about the people who work for them. Big multinational corporations and small businesses alike have been forced to consider layoffs and furloughs.
Businesses obliged to let people go have many difficult choices to make. They must be careful to still abide by all Equal Employment Opportunity requirements, and not lay off anyone in a way that might be perceived as discriminatory.
They must still abide by wage and hour regulations for the employees who remain.
-
Public Relations Concerns
The pandemic and the attendant economic crisis have required businesses to consider their public reputations in this new unknown landscape.
The public response to health concerns seems to vary widely from region to region. Some businesses are shamed for not requiring workers and customers to wear masks. Others are shamed for exactly the opposite!
Some businesses have been successful in obtaining special government relief during this time. However, businesses seen as successful and wealthy were obliged to give back their special loans when public sentiment turned against them!
Even small businesses that usually do not pay attention to formal PR processes may need to think about the ramifications of their actions. Small acts of community generosity, like giving aid to health workers, can raise a struggling business’s public profile and boost customer loyalty.
-
Employee Burnout
The few workers who remain in functioning businesses may struggle with lots of pressure during this uncertain time. People may be working far longer hours than usual because of the diminished workforce. They may be less likely to complain out of fear of losing their jobs.
Depression and anxiety are on the rise. People may have sick family members they are worried about, or children at home needing home lessons.
Companies need to consider these burdens on their workforce, and whenever possible, make sure that employees are getting the physical and mental support they need. Production can be negatively affected when employees are run down.
For employees on the front lines like doctors and nurses, police, and firemen, the stress is even higher. These people face exposure to a potentially lethal virus every day.
-
Medical Coverage
Businesses must consider the health needs of their workforce and the workplace. They must set up clear policies which protect employee and customer health, and make sure these policies are followed.
Special state and federal laws may come into play when a person misses work due to the virus. Whether they themselves are sick or their family member is, a business may have specific obligations.
Businesses should also look forward to when they reopen. Maybe they need to rearrange the workspace to enforce social distancing. Maybe they need to implement testing or temperature-taking at work.
-
Childcare Coverage
Businesses should also be aware of the pressures on parents during the pandemic. With so many schools and camps closed, kids are home requiring instruction, meals, and entertainment.
It can be hard to juggle these needs with the demands of one’s job.
Employers of large companies may need to explore alternative scheduling and part-time options for parents of young children. Workplaces with onsite childcare may need to reassess their ability to maintain hygiene and social distancing under these new conditions, and what else they can offer their employees if they take this benefit away.
-
Hygiene and Cleaning
As businesses reopen, they must make sure that they increase the frequency and effectiveness of cleaning. This may entail hiring extra staff to conduct disinfection processes. There must be an added budget item of increased supplies, from wipes to bleaches to hand sanitizers.
Restaurants and stores offering food must be sure that strict protocols are followed to maintain scrupulous cleanliness.
It is possible that businesses may be liable if their failure to keep their premises clean exposes someone to the coronavirus.
-
Masks?
Wearing face masks has been recommended as a way to keep oneself and others more protected from the transmission of the virus.
This has become a political issue in some areas of the country. Some people resist being told what to do. Other people are terrified they may be exposed by others who do not take the same precautions that they do.
Each business must assess their own community, their own product, and its personal approach to this issue. There are many “grey” areas: you may require employees to wear masks but only request that customers do.
Check not only the CDC’s requirements but the restrictions placed by your local city and state.
-
Remote Work
Some businesses realized when the pandemic hit that they needed to move to a remote work model. For people whose business is computer-based, the transition may not be too burdensome.
Businesses may have had to acquire remote work platforms like Zoom and Citrix in order to allow them to continue as usual. However, these options may end up saving your business money in the long run.
Working from home can alleviate the stress on employees trying to juggle family obligations.
Many telephone-based businesses can transition to home-based as well.
This shift to working from home may significantly change business as we know it. Companies able to make this change may be more likely to come through this successfully. What was once a perk may become a necessity.
-
Real Estate Costs
Often a business’s biggest expense after payroll is real estate. Large office spaces entail cleaning, security, and parking facilities. As a company grows, it needs to rent more space to accommodate more workers.
As more people work from home, large companies may reassess their need for huge real estate expenditures. Why pay all that rent in a big city like New York or Dallas when half or more employees prefer working from home?
-
Government Relief
Small businesses and nonprofits may qualify for government relief under some of the programs launched in the past few weeks. Your company may be eligible for loans through the Small Business Association to help you maintain your company through this crisis.
Some loans may even allow forgiveness. That means you may not have to pay them back (provided you meet certain conditions).
-
A Changed World
All businesses must expect a changed world once a cure is found for this terrible virus. Things may return to business as usual, but certain discoveries may change work as we know it forever. For example, the advantages of working from home for both management and staff will be sure to have an effect on how work is done in the future.
Business Implications of COVID: We Will Get Through This
The business implications of COVID 19 are far-reaching and may cause hardship in the weeks and months to come. Luckily, American business is innovative and resilient. With some ingenuity, your business can adapt and thrive in this new world.
For more important business news and tips, keep checking back.
Interesting Related Article:”Surviving the Pandemic: 10 Financial Tips for Businesses During COVID-19“