The impact of Covid-19 on Businesses
Covid-19 has spread across the world, becoming an unprecedented global health crisis in our time. The impact of covid-19 is manifold, not just in terms of affecting our health, but also changing the way we live, work and play.
Mankind has been forced to adapt to the changes in life brought about by covid-19. We have learnt to stay indoors and make use of technology to help us to work, study and keep our socializations online.
However, the Covid-19 crisis is not over yet. In fact, the worst has yet to come.
Covid-19 has severely impacted the global economy. With prevention measures such as working virtually from home, lockdowns and safe-distancing measures, many businesses are affected with lowered manpower in the workplace as well as lowered consumer demand with more people staying indoors. Coupled with stricter border measures, some businesses are even facing lowered production capacity and lack of goods to sell.
As a result, many businesses see their revenues severely affected by covid-19, thus forcing them to resort to measures such as reducing wages of their workers, retrenchment of workers or even downright closing for good. This is not a good sign for the global economy, as this means an upcoming increase in poverty, joblessness, and an overall decline in consumer spending.
Currently, the global economy is still keeping itself afloat with many governments around the world introducing stimulus policies and cash payouts to their people and businesses. Consumers are also still able to keep the consumer spending currently as most of those affected by covid-19 still have savings that they can count on to keep them afloat.
However, if covid-19 continues to drag on into the future, it is more than likely that an economic crisis will emerge as more businesses fold and consumers start to run out of spending power.
Crisis means Opportunity
In the 1980s, the business environment in the world is less competitive. Starting a business used to be easier with lesser competition and lesser barrier to entry. Entrepreneurship was encouraged and the many young people decided to start businesses in order to support themselves.
It is no longer the same today. With more established corporations operating, the competition is now intense. It is not easy for newly established businesses to compete in their various industries. This has led to lesser incentive for entrepreneurs to start their business. In fact, instead of thinking about making a business or name for themselves, the young potential entrepreneurs of today prefer to keep their money instead of risking it on business. Spending their money on themselves or on their interests is more appealing for them.
In the past, jobless youngsters would consider doing business to earn money to keep themselves afloat. Yet, jobless youngsters today would instead turn to doing other occupations, such as temporary ride-hailing or delivery riders to earn an income for themselves.
While there is nothing wrong in choosing this option, this effectively gives youngsters an income but kills the economy.
As the world goes into crisis mode amidst this covid-19 pandemic, this is the best time to start a business. It is often said that “Crisis means opportunities”. But do you understand what this statement really means?
There is no better time to start a business than now. Currently, we have a good business environment like that of the 1980s to start our businesses in. With businesses around the world affected by the global pandemic, a friendlier, less competitive business environment is formed. Like the youth of the 1980s, we should pick up pace and try to start a business for ourselves now.
During this period, there are ample business opportunities and lower barrier to entry. Take for example, my recent trip to Sin Ming Road. In a coffee shop, I saw 3 out of 5 stalls empty. When I called to enquire about the rental rate, it was only S$1,300 a month. Yet, the stalls remain empty.
In normal circumstances, it is normally difficult to rent a coffee shop stall in Singapore and even if you find an empty unit, the rental rates will be high. However, because of the pandemic, rental rates are lower, while vacant stalls are aplenty.
This example shows us how crisis creates opportunity. With less competition during a crisis, it forms a lower barrier to entry to start a business.
Going for a humble industry
It is now time for you to grab onto the opportunity to start your business. What business should you start then?
Always keep in mind what we have been emphasizing since our first session: Do from what you have and be willing to work hard to improve yourself everyday. Do not try to start a business in the high-end technical industry. Start from a humble industry that perhaps not many would want to go to.
99.9% of businesses fail because very often, we are dreamers. We imagine that by going into high end industries, such as AI technology, it will be a definite path to success. However, not many people can succeed in such a technical industry.
In fact, in many of these industries, it is now a trend to engage in crowd funding or angel investors. Such funding requires the company to engage in storytelling to convince their investors to provide funds to keep the company going. In fact, the leaders of these companies normally profit off these funds instead of the actual earnings of the company itself.
This is not to say that those in such industries are running scams. It is not true. In fact, the investors are the ones who willingly decided to invest funds into these companies. As a willing investor, they are aware of the risks involved if the company fails.
Rather, the point that we are now trying to put across is: How many people have such convincing power to convince all their investors?
Without the charisma and convincing power required, funds cannot be procured. These high-end technical industries are unable to survive for very long without funding and will fail. That is why businesses fail easily.
Instead of dreaming big, perhaps we should all use the crisis to help us to focus back on what we have and be willing to go for humble industries that others may not want to enter. It is these industries that have the highest potential for success. With less start up costs and less competition, it is the easiest to start and succeed in.
Once you have entered the business, be sure to keep in mind to do marketing for it. Do Reach every day. Remember, reach is the success to your business. Target to compete 5,000 reach daily and keep it going without fail. If you are able to be consistent and keep on trying to engage your potential customers to Read your marketing material, you will surely succeed eventually.
If you are entrepreneur willing to work hard, do from what you have and keep on improving yourself every day, you will surely be able to succeed in what you do.