Businesses all around the world will be heavily influenced by coronavirus pandemic and there is a lot of changes they will have to endure in the next few months, for some it will be years.
Manufacturing and Supply Chains
Manufacturing and supply chains will see a dramatic reduction of just-in-time inventory practices and closure of factories due to lesser demand. Alternative supply sources will have to be developed since China will not be able to supply all the necessary components in time. In factories, there will be a significant rise in robotics usage and automation to avoid any unnecessary human contact that would lead to closing the factory due to the virus.
Of course, there will be a lot of products that will suddenly have a huge demand like digital products (cloud services, Zoom, Slack, etc.), consumer goods (toilet paper, board games, puzzles, and game consoles) and medical equipment (ICU beds, ventilators, masks, and gowns). Prices will rise for a number of electronic devices, but supply chain problems could halt an entire market with product shortages. This will turn factories towards a new trend that would ensure proximity-based manufacturing making products more available, which would lead to significant price growth.
Deliveries and Consumer Behaviour
When it comes to deliveries, there is going to be a visible growth of grocery delivery and farm-to-home delivery, led by Amazon’s domination of the delivery market. Amazon will be under the spotlight for not complying with all safety measures for its workers and for not offering a “compensation pay” when working becomes hazardous. Many people will turn to local-to-local delivery services to support them and not use Amazon services. UberEATS and Grub Hub will experience growth in deliveries, but to make them safe they will have to start using a range of plastic containers. This will inevitably lead to a change in how food is processed and delivered with a special focus on sanitary measures. And there will be a sharp decline in “wet” markets around the world.
Consumer behavior will inevitably change after the coronavirus pandemic. Most vacations will become “staycations” in RV parks since those vacations are more affordable in a situation when leaving your country is not a viable option. THE whole RV market will grow especially focusing on repair, rehab, and furnishing.
Another trend is connected to an increase in wet wipes and Lysol sales, which will raise the need for hand creams and moisturizers. This will make a range of diseases less infectious thanks to higher hygiene standards. Research states that this could lead to low immunity in a whole generation of kids as a consequence of overly sanitized hands.
Wearing a personal health tracker like Fitbit, Apple Watch, and others will certainly become a trend as well as a necessity. Some of the current devices will have to be upgraded to gather more biometric data that will possibly increase the invasiveness of data collection and potential privacy violations in the future. One of the key biometric values will the body temperature and according to it, people will be asked to stay home not to expose others to a potential virus.
Fashion and Retail
Coronavirus pandemic drastically changed people’s perspective on fashion demonstrating that in challenging times appearances become less significant. On grounds of people wearing masks all day and spending time at home in comfortable clothes, their interest in new clothes has minimized. New styles include clothes that are comfortable and useful. Since there was a shortage of masks, people started sewing their own making them unique or ordering them from new companies that are selling stylish ones.
New hair trends will develop towards simple haircuts (or no haircuts in lockdown), growing long hair and beard that is easy to manage at home. More casual style will endure even when people return to work since it is easy to maintain. There will be less purchase of shorts, pants, socks, skirts, perfumes, and heels owing to new and more casual trends.
New opportunities in fashion lie in a different marketing approach. DIY beauty and clothing will become more popular on YouTube, live filters will be used more to make people look more professional even if they are sitting at home during the meeting, and fashion brands will have to change their game.
When it comes to shops, things will be changing rapidly. Small retailers will stop paying rent since a proportion of them will be out of work since there had a lot of collected debt and not enough demand to support it. Commercial rent will go down, but not nearly enough to stop stores going out of work. Soon after, malls will become decimated and millions of hourly workers will permanently lose their jobs. In stores that will remain open, there will be more self-checkouts, and many will even use apps for shopping, so there will be no need for checkouts to exist at all.
Entertainment and Events
Entertainment is a big industry that will continue to grow but in a different scope. There will an increased interest in linear broadcast, live streams on social media, and curated content broadcasts. Movie premiers will move online to platforms like Amazon Prime, HBO, Netflix, Hulu, etc. so that people can be a part of it at home. There will be an increase in “watch parties” that friends and families could organize to socialize during the pandemic. Services that will be able to manage liner streams will be an opportunity for many to capitalize on content creation, production, tech, etc.
Second-order predicts no more in-person events, meetings, or gatherings for a while. This will fasten the development of telemedicine and online dating platforms. Thanks to online platforms virtual birthdays will be held as well as virtual museum tours, funerals, summits, and conferences. Music concerts will be broadcasted online, and dance parties will be possible with the help of a good camera and superior quality speakers.
Entrepreneurship and Employment
Companies who start promoting their products in all their capacities will be under scrutiny since the world pandemic is not the time for big marketing projects. Of course, they will then turn to business opportunities that are less impacted by the pandemic such as digital, virtual, and training. Several companies will prolong trial periods, offer products for free or improve functionality drastically to reach their sales goals, or even stay on the market.
Employees will be facing immediate layoffs and seen as redundant and the ones who stay employed will have shorter projects and more contract work. We will see an increase in contract workers and outsourced teams, and this will be a chance for a lot of contract or outsourcing providers to step up their game. Changes of this scale will lead to an increase in poverty, more bankruptcies, and less disposable income for a myriad of workers since their lives will be heavily impacted. Opportunities will arise for charity organizations to make the greatest impact imaginable, but also for pawnshop businesses and loan sharks to use poverty and the need for money.
Work and Real Estate
Considering everything that has happened lately, work policies had to become more reasonable and flexible, especially when it comes to childcare since parents could not rely on schools and daycares to safeguard their children. A range of workers had to leave their offices because of a dramatic decrease in the popularity of the open office concept. These changes will lead to a change in meetings dynamic and it will influence the capacity to make trust driven transactions and close important deals (M&A in particular).
Also, since office buildings will become more vacant, subsequently their prices will slowly drop and in the end, some of them will have to be repurposed. Hotels will be shattered as well, and many will stay out of business as well due to falling numbers of business travels. In the future, there will be a need for reuse of properties such as affordable housing, student dorms, or health care popups.
Working from home will become the “new normal” since some suggest that a lot of people will continue working like this even after the pandemic. This change will make commuting easier since trains and trams will not be that crowded any more. You will see fewer accidents on the streets and employment will become more global. This will allow people with disabilities and the elderly to participate more actively in the workforce. Senior positions in companies will open and there will be multiple rising opportunities to capture institutional knowledge.
Travel is one of the industries that suffered the hardest impact of COVID-19 pandemic and it was largely influenced by new safety measures. Obviously, there will a drop in air travel since most of the population has to be at home, and airports proclaim that only 10% of flights are still on schedule. Travel insurance prices rocketed, and there will be a lot of smart devices whose purpose will be testing and tracking travelers at airports, but also stores, malls, hotels, etc.
Since a lot of major factories closed, there is less demand for gas. When people stop going to work, they drive less, and soon enough oil markets feel those changes and gas prices go down. Consequently, many oil companies took on massive debt hoping it will help them survive the tough times, but they eventually got sold or will be out of business in the next few months.
Nowadays, more energy is consumed at home since it became a school, an office, home, restaurant, and many more at the same time. Gas prices lowered and there is an increase in the alternative home energy market.
In difficult times, certain premiums will skyrocket, and others will plummet. Personal auto claims dropped for 75%, but auto insurance for delivery drivers will dramatically increase. Demand for pandemic insurance will boost up leading up to the government to create a complement to TRIA, and in the future to create a new path for national insurance programs.
Insurance companies will have to change their approach and help their customers during the pandemic. They will be held responsible and dealing with pandemics will require new skills that actuaries will have to obtain soon to be able to continue working.
Lastly, since all major events are canceled or pending, event insurance will no longer be offered, since organizing a major event will possess a significant challenge.