COVID-19 has been one of the biggest tragedies that the current generation has witnessed. The implications of this pandemic are countless!!!
The implications of this global pandemic have been vast and deep across the world, and even after a year has passed since the first case was registered in Wuhan, we still see the aftershocks of COVID-19.
But, not every effect has been a bad one; there have been a few silver linings for some. We’ll take a look at both sides of this global pandemic.
So let’s take a look at the good and the bad impacts of COVID-19 on local and global businesses in 2020.
Instead of complaining about the bad, let’s first focus on the good that came from this incredible change of life. The Coronavirus is probably the worst global catastrophe that the world has witnessed in this century and the first one that we are seeing.
Let’s talk about the few industries that are affected the most by COVID-19.
COVID-19 was an extreme element that impacted the world’s health and economy, so the implications were also on an extreme scale. Let’s talk about the two extremes of business sectors; the ones that did really well and the ones that got their butts kicked by the pandemic.
The Positive Effects of COVID-19 on Businesses
Although it may feel impossible, there have been some businesses and industry verticals that did exceptionally well because their business model boosted amidst the strict global lockdown.
Here are some examples of businesses that did exceptionally good in the COVID-19 pandemic:
1. Food & Grocery Delivery Services
Whether a nation is thriving with money or searching for scraps; the demand for food will never drop. Food is still the biggest commodity in the world, and in case of a pandemic, almost everyone became a stockpiler; drastically raising the demand for food and grocery.
So, many people may have been out of work or barely made ends meet in those times, but the has and will be a big necessity. But another factor came into the picture, safety. So, almost the entire world adopted the home delivery approach to get their food and grocery essentials while staying safe at home, away from the virus.
This became the perfect time for food and grocery delivery companies that were competing to inherit bigger chunks of users each year. Companies like UberEats, Zomato, Instacart, PeaPod, etc. have witnessed a drastic growth of 150% to 200% in 2020 due to the COVID-19 pandemic.
All the local grocery stores, food joints, and restaurants that saw a drastic fall in people buying or eating in were quick enough to pivot their business approach to a digital aspect and tie-up with delivery app businesses or start their own delivery app platform by bundling together.
The grocery and food delivery service launched to make people’s lives easier and save time wasted on weekly grocery shopping or dine outs. Bring in a pandemic like COVID-19, and you get the perfect business model that brings user’s comfort and solves their fear of going out in a single solution.
This was the reason why businesses in these two industries witnessed the highest user subscription in all these years.
2. eCommerce Platforms: Super Winners of 2020
What do you get if you raise the local grocery and food delivery service by hundreds or thousands of products? An eCommerce platform like Amazon or Flipkart. eCommerce was also one of the big winners of 2020.
When the global quarantine started everyone thought that we’d be done with the virus in a month, it’s been more than a year, and there are still random spikes across the world in COVID-19 cases. This gave an amazing opportunity to eCommerce site as people were sitting at home and getting bored.
So, these eCommerce and mCommerce stores kept bringing new offers and sales to sell more and more, and this approach worked. The majority of products bought by people were under the categories of gym equipment, electronics, and various home products.
People had lots of time to kill, and everything was available to be delivered at the press of a button. This epidemic brought the perfect setup for eCommerce brands to cash out, and they did it very well. Amazon saw a growth in revenue of 34% with an additional $40+ billion in just the first six months of 2020.
3. Cleaning Services: The Unsung Heroes
Many heroes were praised for their selfless work in the fight against Coronavirus. From doctors and nurses to police and NGO workers, but there was one group of people that also made our lives easy and also earned good revenue while doing that.
The garbage collectors, dump trucks, and cleaning service providers worked consistently in keeping our streets clean and reducing the chance of spreading numerous diseases, including the COVID-19 virus.
Although it falls in the transportation industry, starting a dump truck business is a different vertical with a unique set of challenges and requirements. But in 2020 it has proved that even though other transport business verticals were shut down, dump truck companies kept working.
4. Tech Industry
In the 2020 trend of work from home (WFH) and study from home, the one industry raking in high revenue is the tech industry. The tech industry, specifically software companies, have indirectly benefited from this pandemic.
Tech companies have benefited from the “work from home” model as the infrastructure and maintenance costs have dropped. From the big daddies of IT industry like Facebook and Google to the small regional firms, everyone has in some parts dropped the old working approach’s dead weight and upgraded their working culture with WFH and other modern practices.
These new upgrades are maximizing the firm’s productivity as well as the client’s benefit while following the new normal of our pandemic ridden world.
5. Hyper-Local Businesses: Name of the Game
The most unexpected but well-deserving winner of 2020 were the small, local stores. The sales of these local stores were being affected for over a decade due to big brands and superstores. But 2020 brought the ball back into their court because of the restrictions in travel and local quarantine laws.
Due to the pandemic, people were afraid as well as advised not to go far to buy things for their home. This sudden lifestyle change made it possible for the hyper-local stores that are just around the corner of every block to earn well because people limited their purchases to the stores of their locality.
This boost to hyper-local small businesses was good enough to put them back on the map and start earning back all the money they were losing due to the neglect they faced all these years due to online brands.
The Negative Effects of COVID-19 on Businesses
The COVID-19 virus is the worst pandemic that the world has seen in a century. Besides the severe health and death implications in the world, this virus crippled the global economy. From small, local vendors to multi-national enterprises, everyone was hit by Coronavirus.
Almost all the businesses and industries are affected in some sorts by the virus. We talked about the good, but now it’s time to face the bad side of COVID-19. Countless industries faced an awful time in 2020 due to COVID-19.
Here are the businesses that saw the worst impact of COVID-19.
1. Travel & Tourism
When the entire world is under quarantine, the most affected industry will obviously be travel and tourism. And this doesn’t just mean the transport, but every small and large vertical related to tourism is impacted like historical monuments, hotels, transport services, tourist guides, souvenir shops, etc.
According to an article by Nat Geo, Hotels were the hardest hit, and they were not earning a dime bringing the total business to a standstill.
When everyone is just sitting at home trying to ride out the virus, and no one is traveling or seeing places like people usually do. The economy gets a big blow, especially countries that depend majorly on tourism activities for their economic growth.
2. Construction & Commercial Manufacturing Plants
A country’s infrastructure has a lot to do with its growth. And the infrastructure is directly related to real estate and construction activities. In 2020’s COVID-19 wipeout, real estate was one of the hardest-hit industries as all the construction projects came to a halt, and the construction workers working on daily wages had no work for several months.
The situation was so challenging that even ready properties were vacant because people didn’t want to tie up their money in a big investment like a home, shop, or office space when there is a deadly pandemic running in the world.
3. Factories & Manufacturing Plants
Just like the construction workers, all the factory workers also faced the same fate. All the manufacturing plants were shut down for an indefinite period leaving their workforce to the mercy of no one. Whenever a factory tried to open and call back the workers to work, one single case would put the whole workforce in jeopardy, and the plants would have to be shut once again.
The factory workers were unemployed for a long time, and many of them had to return to their hometown just to survive through these awful times with minimum expenses. The most job losses were seen in the Automobile industry. There were almost no significant automobile sales in 2020. And such a drop in sales made it difficult for big automobile companies to afford employees when there are not enough buyers in the market.
4. Sports & Entertainment
Which movie did you see last in theaters? Probably the one that came about a year ago. That is because theaters were all shut down in this quarantine period crippling not just the theaters but the entire movie industry.
The same scenario was happening in the sports industry, where no matches or games were being played live due to the threat of the virus spreading. Although now things are getting better, entertainment creators have pivoted to OTT platforms like Netflix and Amazon Prime while sports tournaments are also being organized with extreme care.
But still, the sports and entertainment industry hasn’t recovered entirely from the blow that this pandemic has given in 2020. Things went so bad that not just the lead actors and athletes, but every person from a film projectionist to a food vendor in the stadium were forced to find some alternative to their actual job.
What Did We Learn From COVID-19?
The COVID-19 was a depressing and challenging time that took many loved ones from our lives, but the economic impact of the virus is still haunting us. Thousands of businesses shut down permanently, and millions lost their jobs, and the severity of the economic effects of this virus is still beyond estimation.
We talked about several businesses that did exceptionally well even in these testing times, and some actually thrived on the situation created by this pandemic. So, if you are an entrepreneur thinking to launch a new business, or a businessperson finding new ways to future proof your business, follow the steps of the companies that did well even when the entire world was fighting for its life.