The Coronavirus outbreak has created an unprecedented level of economic crisis across the globe. This pandemic has slowed the economy and impacted businesses brutally. From cutting down on human resources to eliminating non-core business activities altogether, businesses are on survival mode at the moment. Many businesses in the tourism and hospitality segment have also shut down their operations for an indefinite period, and some have closed their businesses altogether.
The repercussion of this slowdown is felt by people who are being laid off without any severance package to manage their expenses. As per research reports, as high as 27 million Indians have lost their job in a month during this pandemic. Given the nature of this virus and lack of any prominent vaccination for treatment, businesses don’t have any robust plan in place to get out of this cannibalism.
The important question here is – which businesses will grow once this crisis ends? It’s hard to say with complete surety as new symptoms of this virus continue to surface without any reasonable explanation, and this pandemic is still very active. Based on the current economic assessment, some projections can be made about which businesses will proliferate after this pandemic ends.
China has been the major supply hub for companies across the globe, given its robust manufacturing capacity, so much that it is also known as the global warehouse. Given the impact this outbreak has had on supply chains, companies are looking for an alternative to reduce their concentration risk. India is the next best alternative for companies looking to manufacture their goods by leveraging the power of cheap labour supply.
Manufacturing companies in India will see an upward push in their operations due to an increase in the demand for manufacturing by global conglomerates. The GST Act was implemented in India to improve the manufacturing sector by removing the cascading effect of the tax. This will surely help the manufacturers to reap huge benefits. The Goods & Services Act has a varied range of tax slabs to cover almost 1300 goods and 500 services. It also provides businesses with the flexibility to file their returns by providing monthly and quarterly return filing preferences.
Companies with an annual turnover amount up to Rs. 1.5 crore can also opt for the GST composition scheme where they are required to file quarterly returns. This reduces the tax hassles for small businesses with lower turnover. Other than the manufacturing sector, the digital economy will continue to grow as it does even during the pandemic. Online education will be a more preferred learning method and will eventually become the norm.
Companies in the Ed-Tech industry will see an upward trend due to the change in customer behaviour towards online learning. In addition to this, companies in the OTT industry like Amazon Prime, Netflix, etc. will continue to boom as their demand grows in this lock-down period. This will be the prime source of entertainment for people staying indoors due to the outbreak.
Companies in the healthcare industry will also see an uptrend as the demand for pharmaceutical products and healthcare equipment continues to grow aggressively in this healthcare crisis. One of the most rapidly growing sectors, even during this pandemic is the e-commerce industry.
The online demand for essential products by consumers is even higher as they are not engaging with physical retail stores. E-commerce is considered as a safer way to purchase goods and services as people don’t have to go out and be in contact with the shopkeeper, reducing their exposure to the virus. This will also give a push to the companies in the logistics industry as they are well connected with the e-commerce companies.
A general trend for companies that will continue to grow after this pandemic is related to those that have a strong digital presence. Also, the companies who are focusing on direct to consumer supply of goods and services will continue to grow as they are reducing the risk element in the process of direct supply.
Companies in the digital entertainment and gaming industry will see a rise in demand as more people are staying indoors for an uncertain period. In addition to this, tech companies providing services related to cloud and network management will improve their demand.
