The continued COVID-19 outbreak is threatening the operational infrastructure and revenue
of many businesses and entrepreneurs. The pandemic has entirely changed the way people used to work, run businesses, connect with friends and family, get an education, and travel. The lockdown situation all over the world has a negative impact of COVID-19 on business.
According to the Goldman Sachs survey, about 96% of businesses say they have already been impacted by the COVID-19 outbreak and 75% of businesses acknowledge that they have fewer sales now as an impact of coronavirus. The unsettling situation amid the pandemic is alarming for the survival of businesses. All the industries are suffering during the crisis and are overwhelmed about the situation and the next steps to take to fight against the increasing challenges faced by businesses during COVID-19.
In the wake of companies affected by coronavirus eruption, it is crucial to determine the state of businesses and the factors that contribute to the subsistence of businesses. From innovators to entrepreneurs, and small business owners to policy leaders, a common view is to take into consideration the ‘technology’ aspect that can act as a savior for business entities. Whether it is brick-and-mortar stores, education, or health, the paradigm needs to be shifted to the digital world.
In this article, we will look at the potential problems that companies will face in the year 2021 due to coronavirus.
1. Revenue Uncertainty
Revenue uncertainty is one of the primary challenges faced by businesses during COVID-19. Over the past year, the landscape of business infrastructure and cash flows has suffered a lot. A study shows that in February, about 41% of businesses reported they would be able to manage the business operations up to less than three months from the cash on hand.
The partial and complete lockdown situations have a dramatic effect and companies still affected by coronavirus are facing unbalanced business revenue. The long-term risks are making it hard for businesses to identify what lies ahead and how to cope up with the particular problem. Businesses are confused about the new hirings and managing the pandemic effects on business revenue.
2. Aftershocks of Information Overload
Hopelessness and fear will be affecting the mindset of businessmen. The additional tension of uncertain COVID situations is giving birth to intense emotions in the minds of entrepreneurs. Everyday evolving coronavirus business news and an inexorable flood of information are responsible for immense stress. Even sometimes the false news overcomes the real circumstances and becomes the reason for the harm.
Businesses will be facing such issues in everyday news that needs to be mitigated by staying determined and patient. Before letting the information reside in your mind, cross-check the news and the source of it. Clean your channels of information to reliable ones to keep yourself always updated with actual business situations.
3. Adoption of Innovative Solutions
A real problem businesses will be facing in this paradigm shift will be the adoption of innovative solutions. By employing cutting-edge technologies, only the businesses that have room to go online can take advantage. In 2021, businesses will require to identify the use-cases and establish a proper plan to go online for the successful survival of a business. For small and big businesses, the pandemic is bringing technology revolution.
Businesses are adopting online data management software and systems for better communication and collaboration in order to keep connected with the team members and does not make the work suffer from COVID outcomes. The social interactions, collaborations, and workflows are transforming as per the need of an hour. The eCommerce growth rate is estimated to be increased by 20% with internet usage of 30%.
4. Economic Impact
The economic impact of COVID-19 is much evident. In the year 2021, it is going to stay as a result of multiple reasons. The GDP in the UK is estimated to be reduced by 20% in the second quarter of 2020. The huge fall is recorded from the past which has identified that the most affected businesses are the ones that have face-to-face contact with the consumers and are unable to survive amid the strict government restrictions and lockdown circumstances.
While many businesses are now taking the initiative of getting online and survive in the pandemic. However, limitations of business infrastructure and nature are restricting businesses to shift business operations over the internet. Such serious cases are contributing to affecting the economic conditions of both the businesses and the nation.
5. Cybersecurity Concerns
With rapid digitization, companies are facing an exponential increase in cyberattacks. Due to the fast adoption of digital business solutions, loopholes remain in the system, which becomes the reason for high-scale data breaches and cybercrimes. The failure in cybersecurity measures will keep businesses at risk in 2021.
Stringent security measures would be taken into account to mitigate the risks of criminal activities through digital channels. Through proper authentication and verification of entities, controlled access should be ensured into online systems to control payment frauds and other malevolent activities. Cybersecurity is one of the most serious risks companies will be facing in 2021. It is, therefore, crucial to adhere to regulatory obligations to avoid harsh penalties and fines.
The article takes into consideration the past and current COVID situations to determine “how has the coronavirus affected businesses?”. The increasing threats to business survival demand remodeling of business infrastructure. No one knows for how long coronavirus is going to stay. The downfall of economies and mutations of coronavirus are quite threatening. It is therefore crucial for businesses to establish a well-planned framework to survive amid times of crisis.