Impacts of Lockdown on Businesses
COVID-19 has affected people and businesses in ways we had never imagined possible. It has disrupted all areas of life, threatening the lives of millions of people across the globe. The world was locked away into their homes, and lucky were those who could afford that. People dependent on daily wages saw unprecedented challenges to meet their daily basic minimum. While the impact of the pandemic is clear to the eyes of everyone, below are a few of the most profound impacts of the pandemic on businesses.
Downsizing of big businesses
It is no surprise that the pandemic has made it difficult for even the biggest of businesses to thrive in the market. Big prominent global companies like WarnerMedia, and Maersk have had to cut down and take jobs from many of their employees to reduce costs by a prominent degree, and so did hundreds of thousands of others. The impacts of downsizing like these have left thousands of workers who lived paycheck-to-paycheck jobless. These sorts of layoffs have been said to affect part-time employees more than ever, like those leaving them without any compensation too. It has gone as far as up to 135 million jobs being lost and 120 million people being pushed to poverty in India. (https://www.business-standard.com/podcast/current-affairs/10-well-known-companies-that-laid-off-staff-due-to-coronavirus-120051901344_1.html)
Closing of the small businesses
While big businesses have the technology and manpower to go online or even downsize, small businesses don’t usually have that privilege. It hasn’t always been feasible for small shops and retail businesses to move online, rendering many small startups and businesses out of service. Due to them not being able to reach out to many people, they have been facing things like the inability to pay office rents or the inability to sustain themselves.
Heavy Impact on Tourism Sector
Given that lockdown strictly restricts people from going out for entertainment, for obvious reasons, the tourism and entertainment industry suffers heavy losses. Since people aren’t allowed to travel much, travel agencies do not get enough clients to sustain their businesses. Flight companies bore one of the heaviest losses due to the pandemic. Holiday planners, tourist guides, and others associated with the tourism sector saw a huge cut in their operation and subsequently in their revenue.
Loss to businesses in Entertainment Sector
Restrictions in the human movement have hugely affected the entertainment industry as well. The events which require the mass gathering of people such as Cinemas, Theatres, etc were discontinued for lockdown. All the films which were lined up to release were either put on hold, released on other platforms, or entirely canceled. In all cases, the investors suffered losses due to a lack of audience. Even the upcoming movie projects which were to be executed are postponed with no certainty of when they might get back in production again. On the flip-side, the entertainment materials that could be produced and consumed without mass interaction have completely taken the advantage of the situation. The youtube industry, Animation based industries, etc have been continuously releasing their works and are profiting more than what they did before the lockdown.
New business ideas are delayed
The pandemic and subsequent lockdown have halted new business ideas. If it weren’t for the lockdown, aspiring entrepreneurs would have been actively executing their plans and seeking investors. However, the lockdown has largely obligated them to delay their work and work with increasing uncertainty.
Increase in e-commerce based businesses
E-commerce has been a very prominent mode of business for a few years now. While e-commerce had an increasing market in Nepal with popular platforms like SastoDeal and Daraz, the pandemic has led to a huge spike in the sector in Nepal. With the pandemic hitting harder than ever, even the staunchest of shoppers have started to crave and incline towards online businesses because they don’t have to face the huge crowds at the supermarkets or to get groceries anymore. As everything is turning digital, the global e-commerce business has been said to be increased by 3% just in 2020 (https://news.un.org/en/story/2021/05/1091182). In Nepal, too, things that were previously new, like digital remittance or online Farmers’ Market are things that are getting more highlights.