5 Steps Businesses Should Take To Run Smoothly Amidst Lockdown
As the Indian government orders lockdown for its 1.3 billion population, businesses across the nation have been experiencing the wrath of coronavirus with a surge in demand and low supply across the country.
Within a couple of weeks, India went from a do not panic situation to a complete lockdown mode. This, in turn, affected market sentiment and many businesses had to incur a loss. Although the Indian Government has been proactive to quickly respond to the pandemic outbreak and its looming impact on the economy by directing a lockdown and tweaking policies and regulations to minimise the effect, it is yet to perceive if the measures taken are worth the salt.
Novel coronavirus, which started in December 2019, spread like wildfire, engulfing global markets and triggering a worldwide recession. International Monetary Fund’s (IMF) confirmation of a global recession provides one certainty – the pandemic has overturned the economy for the current year.
Ever since the COVID-19 panic broke out in early February, malls and retail stores witnessed a massive fall in revenue. As per the Retailers Association of India, by February end, the business had dropped 20-25%. However, as a defence mechanism, the Government has relaxed several rules and regulations to curb down the impact further.
Safeguarding your business during a black swan event implies keeping a tab of your business, having a Plan B ready, preparing for the worst and keeping your staff well-informed. To keep your business healthy and running, take advantage of these 5 tips:
1. Ensure Adequate Cash Flow
The coronavirus outbreak has brought in havoc, impacting businesses across sectors. Hence, businesses must ensure adequate cash flow to weather the corona-storm. Regularly monitor and analyse the financial health of the business. Also, have a concrete contingency fund in place should anything go down south. As a rule of thumb, ensure that at least a 6 month of cash runway is available to continue operating during lean times.
2. Have Plan B Ready
As coronavirus aggravates, organisations are setting up proactive measures to secure their business and workers. A counterplan should incorporate creating or revamping a crisis plan. In case you haven’t made an arrangement yet, it’s an excellent opportunity to hustle up. A crisis plan, not just frames what steps your organisation anticipates considering if a pandemic impacts your business, but also takes into account all the critical aspects of the business.
3. Take Advantage Of Government Relief
The coronavirus outbreak has created panic across the economic spectrum as markets around the world signal an upcoming recession. As a countermeasure to tackle the economic slowdown, the Indian Government has come up with a slew of measures to mitigate the economic impact of the pandemic. As a strategic move to slow down the economic impact, the RBI allowed a moratorium of 3 months of EMIs on all outstanding loans. This implies, for the upcoming 3 months, banks will not deduct EMI payments any account which has an outstanding loan.
4. Spend On Marketing
As the pandemic flares up, many businesses across the world are experiencing the heat of disrupted supply chains and low demands. Such times call for proactive marketing strategies. Counter the market downturn with increasing marketing expenses to retain and acquire customers.
5. Re-evaluate Your Business Strategy
Considering the developing coronavirus risk, businesses should re-evaluate their strategy and reduce or modify their production capacity, until the pandemic reaches a controllable level. Furthermore, evaluate whether your current expenses are in accordance with the current situation, in case it isn’t, whether you should cut costs.
The spread and aggravation of coronavirus have created panic across world markets and businesses. However, remember that the salient characteristic of a successful business depends on its adaptability to change. Hence, keep a close eye on the market happenings and act accordingly as the situation evolves.