According to the World Health Organization (WHO), there are now over 93,000 confirmed cases of coronavirus all over the world, and the death toll has climbed to over 3,000. California has pronounced a state-wide emergency after the first life was lost due to the outbreak. Iran is set to limit travel between major cities, while the Swiss government banned gatherings of more than 1000 people. Apple warned retail employees about the shortage of replacement iPhones, F8 conference (along with many other events) has been cancelled.
Depending on how the situation develops, the UK might send employees to work from home for three months – a decision many other countries might need to consider as well. Companies with employees in the most affected areas have already issued a work from home order, but many more have banned travel to these countries.
The predictions from the International Air Transport Association (Iata) state that the airlines industry could be losing up to $113 billion this year, and the collapse of British airliner Flybe is proof that this industry needs plans which will protect it.
Generally, business around the world have been affected by coronavirus in three major ways, and we’ll explore them in this article:
- Supply chains have been disrupted;
- Number of consumers is lowering;
- Work limitations.
Disrupted Supply Chains
China is the world’s largest supplier, so naturally businesses from everywhere are heavily affected when Chinese factories close down. Which is exactly what happened with the outbreak of coronavirus.
Technology and automotive sectors are two sectors which suffered the most, since China accounts for 30% of global exports of electric and eclectic components. Lockdown of the Chinese Apple factories is the main reason Apple reported that they expect loss in revenue in Q1 of 2020. Samsung has been flying parts from China to factories in Vietnam to try and keep up with the production because their trucks weren’t allowed to cross the border. Jaguar Land Rover was flying parts in suitcases, so they could continue making cars in the UK without interruption.
Lower Consumer Numbers
Consumer-facing businesses keep counting their losses because they keep losing Chinese customers. This is especially true for luxury brands, whose pool of customers is almost 50% of the Chinese descent. According to some economists, the drop of 10% in Chinese spending in Q1 could lead to a 4% drop in annual profits.
In general, consumers in China have been spending only the 3rd of what they used to, and it can be expected that the same thing will happen around the world as the virus is spreading even more.
Work from home exploded in a short period of time, but the managers are facing a completely new set of challenges since the whole companies are now working remotely. Corporate travels have been banned, or limited only to the most important business matters.
Even though many companies already have work from home policies in place, it’s rare that entire company or branch suddenly works from home. While this type of work can bring out more productivity, employees and employers who aren’t used to it can run into many challenges.
In a remote environment daily usual things like chatting with coworkers, having lunch together, tracking attendance and having brainstorming sessions in front of a whiteboard are not really possible. Not to mention, asynchronous communication isn’t something all teams are used to.
The fact is that coronavirus outbreak won’t be contained anytime soon, and that companies must prepare while they still have the time. It’s advisable to read up on the best practices for teleworking, investigate how other companies are doing it and rely on numerous work from home guides you can find.
The post Here’s How Coronavirus Is Disrupting the Business World appeared first on Market News Bizz.