It’s safe to say that the coronavirus pandemic took the entire world by surprise. Most countries were simply not prepared for the effects that it could have and how it could impact various spheres of life. In terms of economy, travel and hospitality industries have certainly suffered the biggest loss but trade, manufacturing, and similar industries did not fare much better due to lockdowns and various measures that limited their operations.
With that in mind, how has trade been affected by the global pandemic? Is there anything you can do to protect your business or recover it after a potentially disastrous year? Take a look below to learn more.
How has the global pandemic affected worldwide trade?
Thanks to the fast responses of particular governments, not all regions were affected on the same scale. However, this has also led to uncertainty when it comes to trading with some regions. So, what kind of effect has that had on worldwide trade?
Disruptions in the supply and demand chain
First of all, with the closing of borders, the international supply and demand chain was disrupted. For example, in order to curb the spread of the virus, China, the world’s leading manufacturer, had to stop a big portion of its industrial capacities. In addition to this lack of supply, some countries completely closed down their borders, meaning that international trade was suspended as well, which led to a lack of demand.
In order to stay afloat during these difficult times, many companies have had to lay off employees. This resulted in a drop in their capabilities and reduced productiveness. Moreover, while there are certain jobs that can be done remotely, a large part of the logistics chain cannot be handled in such a way. People that work in trade have thus become essential workers and are put under a lot of stress and in various risky situations. Oftentimes, they are also not compensated enough for their hard work.
Lack of purchasing power
When we take into consideration how many people have been laid off due to the pandemic, it should not come as a surprise that there is a lack of demand. Losing their jobs has lowered the population’s purchasing power and while various stimulus checks are provided by governments all over the globe, they are usually saved for some essentials like food and utilities.
What can you do to protect your business?
Despite the impact that the COVID-19 pandemic has had on trade, it remains essential for survival. There is absolutely no reason to believe that trade will ever stop. However, if you want to stay in this line of work and protect your business, there are certain measures you will have to take.
Adopt a new business strategy
If you’ve noticed that your current strategy is not working as well as it used to, it’s time to reconsider. Adopting a whole new strategy is often not easy but it is also not impossible, as it is obvious that you need a new approach to improve your business. Use analytics to see what is working and what isn’t while you can consult with business strategy experts as well.
Look after your cash flow
Something else that you need to do in order for your business to be successful is protect your cash flow. Cash flow is vital for your day-to-day operations as well as for long-term planning. Besides making sure you are setting aside enough money to cover all your debts and responsibilities, you also have to ensure your clients are paying you on time. If they are late even after you’ve politely reminded them about the payment, you should turn to debt collection companies that will recover your money with their expert services.
Consider raising prices
To keep your business afloat, you can also consider raising your prices. Many customers appreciate a quality service above all else and they will not have any issues with such a move. If you understand your audience, you will find a way to make this acceptable and not lose them in the process.
Cut down on unnecessary costs
On the other hand, if you don’t want to raise your prices, you can find ways of lowering your costs. For instance, a part of your workforce can work from home and you can look for a smaller, more affordable office. Perhaps you can find new vendors or partners that are more cost-effective or cut down on some other luxuries.
Find new ways of promotion
Finally, you can implement some new ways of promoting your business. The best approach is combining the online and offline methods so make sure you’re covering all your bases. From TV and radio ads to newspaper ads and billboards all the way to social media and email marketing, there is a lot you can do to make sure your company gets noticed.
If your business was affected by the global pandemic, it’s good to know that there are still ways how you can recover it. Keep the aforementioned tips in mind and your business should bounce back.
Mike is an Australian business consulting specialist. He’s working with companies that outsource their IT maintenance. He often writes about technology, business and marketing and is a regular contributor on several websites.