The coronavirus outbreak, which originated in China, has infected tens of thousands of people globally. With over 153,648 confirmed cases across 146 countries, the World Health Organization (WHO) has officially declared it a pandemic. (Source)
Since there is no vaccine to prevent the spread of coronavirus disease 2019 (COVID-19) to date, the only prevention that people have is to avoid being exposed to the virus. This is tried to be achieved through social distancing, personal hygiene measures, and avoiding contact with the infected person.
To mitigate the risks involved with the contagiousness of the disease, several countries and their cities were put into lock-down, placing quarantine measures on the entire population. This had confined citizens to their homes unless they have to buy food, medicine, or seek any medical treatment.
Along with this, global companies like Google, Microsoft, Apple, Salesforce, Twitter, etc. have rolled out mandatory work-from-home policies amid the spread of COVID-19. People are advised to avoid social gatherings and travelling to different countries/cities to avoid the further spread of the disease.
These limitations are leading to a business slowdown in some industries, while there are some that are least affected by the pandemic. Finance, entertainment, tech, hyperlocal marketplace, travel, retail, hospitality- let’s check out the impact of the COVID-2019 outbreak on these industries.
1. Tech
This year, 10 major tech conferences including Google I/O, Mobile World Congress, Facebook F8, SXSW, Electronic Entertainment Expo (E3), etc. have been cancelled due to the coronavirus outbreak.
Coronavirus has a mixed impact on tech companies. With work-in-isolation policy being a mandate for employees, there are companies that make the most of it in terms of profit. For example:
Since technology companies have closed their offices and stores, restricting their executives to travel to the affected areas, it has adversely affected the supply chains. For example, manufacturers in China are the key suppliers to technology companies across the globe. Manufacturers who have been impacted by the coronavirus are failing to make on-time delivery, thereby impacting various tech businesses.
On the other side, IT firms are realizing the benefits of outsourcing, more than ever. Remote working has been given preference amid the COVID-19 and thus functions such as software development & maintenance are least affected by the coronavirus.
2. Insurance
The rise of coronavirus cases may end up with the demand for certain insurance types. As the COVID-19 virus continues to dominate the headlines, there is a hike in demand and awareness about insurance plans for health and life coverage.
The demand for life and health insurance policies has seen a jump of 35-40% on online insurance platforms in India (Source). On the other hand, travel insurers have experienced a dip in the number of insurances due to travel restrictions. Depending upon the type of insurance that a company deals in, there are positives and negatives of the coronavirus pandemic in the insurance industry.
3. Sports & Entertainment
The entertainment industry is adversely affected by the coronavirus outbreak. However, as more people stay at home, in self-isolation, and take quarantine measures, there is an increased use of alternate entertainment services such as games, video-on-demand, etc. According to the Financial Times, the number of app downloads surged in China after the nationwide isolation measures were taken. Video streaming companies such as Netflix, Amazon, Disney+ are expected to have a rise in the number of subscribers in the impact of COVID-19.
ALSO READ: How to Ensure Business Continuity Amid COVID-19 Crisis?
4. Hyperlocal Marketplaces
While people are in isolation to mitigate the impact of COVID-19, hyperlocal delivery services are making the most of it. Doorstep delivery services for food, medicine, grocery, packages, etc. are gaining ground. To make it safe for the recipients and riders, food delivery companies such as Deliveroo, Postmates, Instacart, Zomato are giving options to choose contact-less delivery, wherein the rider drops off the package outside the doorstep.
5. Travel & Tourism
The travel & tourism industry is severely affected by the coronavirus outbreak. With COVID-19 being a pandemic, people are avoiding travel to different countries and cities, which has negatively impacted the travel business and has affected the tourism benefits of the affected countries.
Airlines are drastically cutting flights and flight rates as more people have decided not to fly during the outbreak. According to the International Air Transport Association (IATA), global airlines may lose $113 billion in sales if the coronavirus continues to spread at this pace.
6. Retail & eCommerce
Malls, shopping centers are temporarily shut down in effect to COVID-19. Also, since people distance themselves from social gatherings and crowded spaces, they prefer ordering their favourites or necessities online. Similar is the case with the retail business.
On the contrary, digital commerce businesses are trying to make the most of this situation. Nevertheless, thriving in such an outbreak is still a challenging job for eCommerce businesses.
7. Fintech
The COVID-19 spread is proven to be the biggest threat to the global economy and financial markets. If we look at the short term impact, we could see people making safer investments in the market. This means there are fewer investments in the stock market, a negative impact on VC funding of existing and new fintech firms.
The Fintech sector has experienced a drop in transactions at all levels. Since people have self-isolated to protect themselves against the COVID-19 spread, they are spending less than usual, leading to a low transaction rate. In fact, cryptocurrencies such as Bitcoin, Ethereum have experienced a major dip amid the coronavirus effect.
8. Manufacturing
The COVID-19 pandemic shook the manufacturing industries profoundly. As has been the case after other major upheavals, such as the 2008-2009 financial crisis, a return to pre-crisis levels took several years. Back in 2008, it took manufacturing industries three years to return to the pre-crisis level. This time the course of the crisis will be at least as severe as it was during the financial crisis, if not even worse.
The simultaneous supply and demand shock with shutdowns has led to extremely deep slumps and an “up and down” recovery is more likely than a steady curve. Further, China is failing as a growth driver, and industry disruptions already underway are now accelerating.
9. Real Estate
As the effects of COVID-19 are felt around the world, real estate companies are being impacted in different ways, largely dependent on region and asset class. In the near term, real estate executives are concerned with preserving value and liquidity, keeping tenants and visitors safe, including increased cleaning measures, and complying with governmental agency requirements.
10. Ports & Logistics
Ports provide key infrastructure in support of international trade and the global economy. They vary in size from wharves handling at most a few hundred tonnes of cargo a year to large international ports or multi-modal hubs combining a broad range of logistical services, from warehousing to total supply chain management. During the COVID-19 pandemic, ports have had to adjust to the reality of lower volumes, worker shortages, the implementation of occupational health and safety measures for dockers and shore personnel, and the adoption of teleworking and remote operations for office workers. In some countries, calls by cruise ships have come to a halt.
However, in the end, policies, health and our very survival are within our control. Scenarios and anticipation of work can be powerful tools to imagine a possible future. We must make a policy that prevents and, where needed, prepares for those futures we do not want. Well, we all will prepare for the worst and hope for the new dawn without the nemesis of COVID-19.
In these tough times, technology can aid businesses to find alternate avenues to reach out to their customers. Worth mentioning here is a business continuation journey of one of our customers who provides a school bus tracking system to 1000+ schools across India. Since the lockdown forced all educational institutions to shut down, the client saw this as an opportunity in disguise. The client asked Daffodil Software to develop an online teaching platform for schools and other educational institutes, which Daffodil delivered in a record time. The client was successfully able to implement the online teaching portal in more than 200 schools across the country.
To know how your business can benefit in these dire times, set up a free consultation with our experts today.