This is a brief overview of the post-Covid-19 effect on the economic state of small and medium-sized enterprises.
This post also covers:
- the effect of the Covid-19 pandemic on the monthly GDP’s of various countries,
- the positive effect of the Covid-19 pandemic on small businesses and how it helps them prepare for the future,
- Post Covid-19 effect of various industry types,
- And lots more
Let’s dive right in.
Like most pandemics in the past, Covid-19 has been observed to have a very negative impact on the economy both globally and domestically. The outbreak has affected most countries, leading to the closure of land, air and sea borders, which in turn has brought a standstill to most international trades.
While most countries struggle to safeguard the health of their citizens by embarking on social distancing and lockdown measures to combat the spread of the virus, it’s important to note that the imposed lockdown means a suspension in economic activities within the countries.
And most countries are already experiencing a massive drop in monthly GDP. This could greatly affect SMEs as well as the large industries even after the pandemic has been combated.
The post-Covid-19 effect on the economic state of SME’s will favor: adaptability, foresight, creativity, and opportunism.
Individuals will emerge from the lockdown with their resources depleted, especially small business owners and daily income earners who make up majority of the population in sub-Saharan Africa, thus leading to a drop in demand and a reduction in revenue for most industries.
A reduction in revenue of companies can lead to laying-off of workers especially in areas where the death toll isn’t high. For areas with high-death toll rates, there may be a scarcity of skilled labour.
Let’s briefly analyze the effect this pandemic will have on various industries:
Online streaming services such as Netflix, YouTube, and the likes as we have seen have been one of the highest beneficiaries of the Covid-19 lockdown with people having to stream videos to kill their boredom or to learn new skills online.
Covid-19 vs Remote Working
Also due to the isolation, in industries where it is possible, remote working has been highly adopted.
I see remote working remaining largely adopted even after the pandemic. This is because more business owners are now realizing the advantages of this (such as reducing the amount of workspace and saving cost on inventories), and also realizing that workers can still be efficient working from home.
Even after the pandemic, people will still be conscious of social distancing, hence, the idea of working from home would be very much welcomed.
Now, for people to work efficiently from home, they need a fast and reliable network provider that is why the new 5g network is a welcome development. Furnish yourself with the skills required to make working from home convenient and effective.
Post Covid-19 Effect on the Agricultural Sector
The effect of Covid-19 on the Agricultural sector has already started to take its toll, due to the sudden lockdown of local markets; perishable goods which would normally have been sold at these markets are now left to rot in the hands of the farmers.
This means that already, these farmers are experiencing a loss in revenue.
Meanwhile, traders that had some food stored-up have sold them at high-prices due to the panic buying caused by the lockdown. People are trying to stock up food in case the situation gets worse.
Now imagine what it would be like after the pandemic, the farmers trying to regain what they lost during the isolation might decide to hike up their prices, the traders who had to live off the little resources at hand during the isolation (some may have even eaten into their capitals depending on how long the lockdown lasts) having to buy from these farmers.
The agricultural and food sector will suffer because not all the traders will be able to start up their businesses immediately after the isolation, this may lead to a hike in prices of food items.
But as we all know, people must eat no matter the economy so the demand will be there and will need to be met. This is why I consider going into food retail a good small business start-up post-pandemic.
Post Covid-19 Effect on the Travel and Tourism Sector
The travel and tourism sector is one sector that will experience a very slow recovery from this Covid-19 pandemic.
I doubt that after this recent experience, people will be interested in leisure travels or tourism for some period of time.
International travels will be subject to pure necessities such as business, health or education-related matters.
If you are a travel agent or a tour guide, I strongly advice that you find a more lucrative means of livelihood for the time being or prepare for hard times ahead. This negative impact on the travel sector may lead to reduction in transport fares for international travel especially to hard-hit areas as transport operators will reduce their prices as an incentive to attract customers.
Post Covid-19 Effect on the Health Sector
The effect of Covid-19 on the health sector cannot be over-emphasized.
Hospitals and Health workers all over the world have been the heroes in this fight against Covid-19 – having to deal with not enough bed spaces, lack of PPE considering the infectiousness of the disease and the risk of the infection which has led to the death of hundreds of health workers.
The post covid-19 effect on the health sector will leave hospitals with depleted resources and the need for necessary financing to restock.
There will also be a shortage of health workers as more hospitals have sprung up due to the pandemic and some health workers have also lost their lives to the fight so more staffs will need to be employed especially in hard-hit countries.
Hygiene has been advocated as one of the preventive measures in the fight against the deadly Covid-19 pandemic and many have learned to adopt this in their daily lives. So I think it is safe to say that these hygiene practices will not be dropped in a hurry after the pandemic.
This means that due to the trauma and habits picked up during the pandemic, products like hand sanitizers and other toiletries like it will still be in demand, even post-Covid-19.
Covid-19 has taught so many people the importance of personal space and this will not be forgotten it in a hurry.
Post Covid-19 Effect on the Transportation Sector
Most people would avoid public transports, trains, and others.
This could create a boom for such service providers as Uber post-pandemic as people would still struggle to maintain their personal space and sanity – most wouldn’t even accept that the public transportation system is safe for their health even after sanitization of the environment by the government.
Post Covid-19 Effect on the E-Commerce Sector
However, transportation may be one of the few aspects where people seek luxury, remember I told you most of the population will come out of the lockdown with their funds highly depleted?
Well, what’s luxury to a man with no money?
People would be more concerned with affording food to eat and other such necessities, luxuries such as getting new shoes and clothes or new electronic devices wouldn’t be their immediate problems.
Post Covid-19 Effect on the Entertainment Sector
These people fresh out of lockdown with the knowledge that public places aren’t the safest place for them will avoid going to cinemas where they can encounter crowd or fancy restaurants at the top of their to do lists.
Post-Covid-19 , people will come back to their daily lives with a fresh zeal to be their best selves and a determination to do better, even though we know this resolve may not last long for most.
There may be changes in career paths, some businesses may not survive, however, I don’t think there has ever been a better time for a fresh start at a new business or endeavor. Just look out for the opportunities around you and make the most out of them.
Now I’d love to hear from you:
What other economic trends have you noticed of recent among small businesses that you think was brought about by the Covid-19 pandemic?
Do you think Covid-19 has brought about a positive or negative change in business economics in general?
Why do you think so?
Or maybe the post covid-19 effect on small business enterprises won’t be so damaging afterall?
Either way, let me know by leaving a comment.