Does COVID 19 turn into a global economic crisis?
I think yeah and the word “Global Economic Crisis” is not enough to describe the situation. It is going to be an economic tsunami, that we never have seen before.
Till today almost nine hundred thousand people are infected and 42000+ people already died and it is increasing continuously.
Around the globe, almost 50% of people are socially lockdown and a very large number of commercial organizations have stopped their operation.
Many people have become jobless and unemployed, stock prices are going down day by day. World leaders have declared some trillion dollars to stimulate packages for the economy.
But all these are just a small spot of the iceberg.
Just think, it has been a few weeks, COVID 19 spread 200 countries on the planet. There is no good news about controlling COVID 19 except China, Japan, and South Korea. A large number of commercial organizations are not in operation.
In this article, I am not talking about the current situation. I am talking about what will have to face the world if the social lockdown will continue for the next 3 months?
Some Economic Matrix till End March 2020 after COVID 19 Attack
All major airlines are unable to run their operation. Many hotels and restaurants are closed. Many industries just stopped their production. The transport sector has become stuck.
Till the end of March 2020, major garment manufacturer country Bangladesh has faced about three billion dollars order cancelation.
Sales dropped in the USA market and their economy shrinks 24% in the last month. 6.6 million people are now jobless after COVID 19 attack on the US.
In my opinion, we are going to face an economic crisis that we never faced in the last 100 years.
What We May Have to Face if the Lockdown Continue for the Next 3 Months
If we can’t beat COVID 19, and the lockdown continues for the next 3 months, many small and medium entrepreneurs will lose their total capital and they will unable to run their business. Thus many employees will face unemployment.
If the small and medium scale entrepreneurs can’t run their business, supply chain management for the backward and forward linkage will breakdown.
In this way, big entrepreneurs will also face serious crises to run their production and sales.
In many areas, farmers can’t sell their products for this lockdown situation. Thus in some areas, milk, meat, egg, and vegetable prices already go down and in the metropolitan areas facing a shortage of supply of the said products.
You will see many entrepreneurs will be bankrupt in the next few months.
Thus millions of people will face unemployment if the lockdown continues for a few months.
When a lot of people are unemployed, they will not buy products and services as they will face a cash flow crisis.
In these ways, the world economy will go to a deep coma.
How We Can Run Our Business in the Lockdown Situation
Let’s see what we can do to move our economic cycle.
First of all, we need to run our local businesses like groceries, supermarkets, boutiques, restaurants, etc. Till today maximum numbers of local businesses don’t have an online presence. This is the right time to give your business an online presence. Whatever you sell, products or services, just make it an online business, eCommerce or business website and apps.
For delivery issues, you can use a drone to deliver the products to your customers.
Secondly, if you are a manufacturer, divide your manufacturing unit into many unites.
For example 1: If you are an apparel manufacturer, you can send your sewing machines to your sewing operators’ home. They will make all apparel from their home. In this case, you have to provide the pattern and accessories also, so that, they can deliver you packed apparel.
In this system, you have to use drones for providing raw material to your workers and collecting finish goods.
You can also divide your apparel production unit into many unites.
Both ways may help you to run the production that will be helpful to move the economic cycle.
Example 2: If you have a service-related business like a restaurant, you can make an app from the app developers. Do digital marketing of your app. Cook the food that you are getting order in your app and delivered by a drone.
Go With the Market Demand
Though many businesses are not in operation or don’t get customers, in the pandemic situation there are many products that have high demand in the market.
If your existing technology allows, you can start production of the mask, PPE, testing kit, infrared thermometer, cleaning equipment, and cleaning chemicals, ventilators, etc.
Around the globe the above-listed products are very high in demand and supply is very short. The demand for these products will continue until we can’t solve the COVID 19 situation.
Reduce Your Marketing and Administrative Cost
In the current economic crisis, many companies have declared vacations without payment to their employee. Some companies reduce their employee’s salaries and wages. But this, not the only solution.
You can reduce your marketing costs by doing digital marketing. You can reduce administrative costs by hiring freelancers.
If you want to reduce your advertisement cost, you can make an animation video and promote that on social media platforms.
The more you use technology, more options will open to you for reducing your costs.
You can hire an SEO expert in Bangladesh for the digital marketing consultancy.
Though all Governments have taken necessary for supporting their economy, when the situation is a lockdown, that means the economic cycle is not moving now.
Whatever the money Governments can give, it will finish within a very short period, if the economic cycle can’t move.
It is our duty to save our planet from this crisis.