What will business after coronavirus be like?
This is a question that’s probably on the lips of every entrepreneur.
2020 was a rough year for everyone. The COVID-19 pandemic raged through the country, threatening the health and safety of Americans. Business operations in a wide range of industries were affected because of social distancing and stay-at-home orders. Financial fragility became the norm.
But that’s changing now.
Business reopening after COVID 19 is picking up. Small businesses across various sectors see renewed demand for their products and services.
In this post, we will examine what business after coronavirus will be like this summer.
We’ll touch upon the success of the vaccination drive and the impact it has had on the day-to-day lives of people. We’ll also discuss consumer behavior. Finally, we’ll look at how some specific types of small businesses are faring in the post-Covid-19 world.
Vaccines and the prospect of herd immunity have led to an easing of restrictions
The country’s vaccination program has been a resounding success and has played a vital role in improving public health. As of June 9, and according to official data, 51.7% of adults have received at least one shot. About 42.3% have been fully vaccinated.
Although vaccination coverage statistics present a positive picture, the much-touted protection promised by herd immunity is not as easy as it once seemed.
What’s herd immunity?
Herd immunity is when a large proportion of the population becomes immune to a virus thanks to vaccination. Because of this, the virus would have fewer people to infect, and infection rates would fall. Over a period, the immunization would eradicate the disease.
But it looks like herd immunity won’t be so easy to achieve as people originally thought.
Initially, the medical fraternity thought that if 60 to 70% of the population received the vaccine, the disease would disappear. Later, experts said that at least 80% of the people in the country should be immunized to achieve herd immunity.
But now the thinking has changed.
Epidemiologists point out that even if 95% of the country’s population becomes immune to Covid-19, there could be pockets where the vaccination rate is much lower.
And that’s not even considering the percentage of the population that isn’t willing to get vaccinated.
Source: Our World in Data
The disease could spread in those areas that haven’t received the vaccine, difficulting herd immunity.
So, it’s unlikely that the coronavirus will be completely eliminated.
However, vaccinating as many people as possible, especially those most vulnerable to the disease, seems to be the right approach. The country is definitely on the right track in this vital mission.
Restrictions are being lifted
With the worst behind us, business after coronavirus has seen a marked improvement. The lifting of restrictions has greatly helped the revival of the global economy, and many businesses are now fully open.
The Centers for Disease Control and Prevention (CDC), the national public health agency of the United States, has announced that it’s safe for people to stop wearing masks in specific settings.
Also, many travel restrictions have been lifted. For example, fully vaccinated people don’t need to have a COVID-19 test before or after travel.
Will there be a new Covid wave?
There’s a fear that business reopening after COVID 19 could suffer if there’s a fresh wave of infections and customers have to stay at home again.
Let’s see what the experts have to say about this.
Dr. Scott Gottlieb, who’s the former Food and Drug Administration commissioner, recently said:
“I think we’ve done enough to give ourselves an opportunity to enjoy the summer and be at low risk.”
Infections will dramatically slow down thanks to the vaccination campaign and the warm weather, which will create a summer season with fewer cases and more normality. So, it seems to be safe to say that business will pick up, right?
But Dr. Gottlieb adds that there’s no room for complacency.
“I do think that this is going to be a risk as we get into the fall and probably more likely this winter.”
The appearance of normality during the summer can cause people to believe that it’s no longer necessary to get vaccinated and this could lead to more complicated fall and winter seasons.
What’s the message for entrepreneurs and businesses?
Although business after coronavirus is getting back to normal, COVID-19 cases will not come down to zero. So, if there’s another outbreak later in the year, and your employees’ health is affected, you may face staff shortages.
There may also be a decline in business levels in certain fields as people go back to working from home.
In other words: businesses shouldn’t let their guard down, start creating an emergency fund, and keep certain security measures whenever they can (like the use of hand sanitizer and keeping employee safe-distance).
On the consumer front, there’s plenty of good news. As the economy opens up, more and more clients are adopting a positive mindset. Consumer confidence is coming back.
In April, the Conference Board Consumer Confidence Index climbed to 117.5, the highest since February 2020, the month in which the COVID-19 recession started. In May, the index held steady, declining marginally to 117.2.
What does the Conference Board Consumer Confidence Index measure? It tracks prevailing business conditions and the attitudes of customers towards:
- Buying intentions
- Vacation plans
- Expectation for inflation
- Stock prices and
- Interest rates
So this index shows that business after coronavirus is returning to normalcy.
However, some things have changed from the pre-coronavirus crisis. The gig economy has got a boost as more people opt for freelance work. A recent survey found that 92% of respondents think it’s a good time to look for gig work. This can affect how customers behave.
The gig economy is when workers prefer to be independent (having short-term or freelance jobs) rather than have a full or part-time job.
Now, we’ll analyze how business after coronavirus has reshaped various industries. We’ll also discuss some of the steps that owners can take to make the most of the post-COVID business environment.
Industry trends after Covid-19
It’s important to realize that Covid-19 hasn’t affected every industry in the same manner. Some sectors have fared better than others. Even some businesses weren’t that affected thanks to grants offered by the Small Business Administration.
Let’s see a summer forecast for certain fields and the influence the pandemic will have on their prospects.
Mom and pop shops and convenience shops
This sector was hit hard by the pandemic. People switched over to online shopping when the government implemented lockdowns, plus quarantines paused the supply chain in many cases. However, many mom-and-pop stores saw a revival as they implemented home deliveries and increased their digital presence: they adapted to what their customers wanted.
Mom-and-pop stores play a vital role in the American economy. The country’s 4.7 million mom-and-pop stores employ 12.6 million people.
What does the future hold for this sector?
According to Nielsen, a global marketing research firm, you can expect convenience stores and mom-and-pop stores to grow faster than all other offline channels in the next five years.
Because they are located closer to consumers’ homes, people find it convenient to shop at them. They are also considered “essential services” and are less likely to be affected by a lockdown.
Construction businesses and contractors
The coronavirus pandemic caused global supply chains to be disrupted and project delays in the construction industry. Many construction sites closed down to stop the spread of the virus.
But all that’s over now.
Construction jobs are back, and the industry is poised for a quick recovery.
One contributor to business after COVID 19 will be the pent-up demand from the housing sector. According to a new report from Freddie Mac, the government-owned corporation that buys mortgages from small banks, four million homes are required to meet existing demand. That’s an increase of 52% compared with 2018.
“People just want to get out of the house. They want to get out, they want to eat, they want to be around other people. It’s awesome.”
Those are the words of a restaurant manager in Los Angeles, and they neatly sum up the present mood across the country.
Restaurants were among the worst sufferers of the COVID crisis. Stay-at-home orders and fear of the virus kept people away, leading to layoffs and closures.
However, the hospitality sector is booming as business gets back to normal. A recent report in Bloomberg titled, “Bars and Restaurants Are About to Go on an Epic Post-Covid Hiring Spree” points out that this industry can expect to see a period of rapid growth.
The coronavirus pandemic decimated the tourism sector. Hotels closed down, airlines saw a drastic reduction in ticket bookings, and other areas of the tourism industry witnessed steep declines in business.
But business after coronavirus is expected to see a sharp resurgence.
A survey conducted by Destination Analysts, a travel market research company, found that 87% of American travelers are expected to take a trip this summer.
The travel industry is slowly gaining strength.
A CNN report estimated that the country would see 37 million people traveling over Memorial Day, up from 23 million last year. Some tourist destinations are already witnessing a boom. Hawaii saw an influx of 114,000 visitors over the Memorial Day weekend. Hotel occupancy in the State is rising, and there’s already an acute shortage of rental cars.
The COVID-19 pandemic led to slowing demand and falling freight rates for truckers. Factories shutting down and a fall in the volume of port traffic worsened the situation.
Today, conditions are entirely different.
According to the Cass Freight Index for Expenditures, which measures overall North American freight volumes and expenditures, the sum that shippers spent on shipping goods in March was 17% higher than the comparable figure in February. In fact, the month of February had seen a spike of 27.5% compared to the March 2020 figure.
What’s behind the increase in shipping rates?
Business after coronavirus is booming for the trucking industry as construction sites resume work and factories reopen. Additionally, truckers are getting large pay hikes, as there’s a shortage of truck drivers.
Business strategies for the COVID summer
There’s another significant change that the COVID pandemic has brought about.
Remote work is here to stay. During the lockdown, many people had no other option than to work from home (WFH). But now, both employers and employees have realized that there are many advantages to working remotely. This also chages the behaviour of customers, because they don’t go out to work, they tend to eat at home or buy online.
Entrepreneurs should carry out a detailed business review to determine how COVID-19 has changed their industries, products and services. Although small business forecasting can be difficult, there are some things you can be sure about in the post-COVID-19 world.
E-commerce volumes have surged. So it’s vital for big and small businesses to develop a comprehensive digital strategy. Step up your social media presence, upgrade your website, use digital platforms, and think of other ways to grow your online presence.
You should also adapt your products and services whenever possible. Why? Because customers have changed, and companies cannot stay in the past.
Now, all this may require additional funds. Small business loans are a great way to invest in your business’ growth.
Keep a strong business this summer season
Many sectors of the economy are doing well as the COVID-19 crisis recedes. Entrepreneurs and company owners can expect business after coronavirus to maintain this positive trend in the weeks and months ahead. There might be new opportunities and challenges in the future, but now you have the insights and tools into the market.
It’s now up to you to organize yourself so that you can make the most of these resources in the coming months. Your business can go back to normal circumstances this summer.
We invite you to subscribe to the Camino Financial Newsletter to receive business management tips and learn about new ways to grow your company. Our motto, “No Business Left Behind,” guides us in our effort to provide you with the information you need to boost sales and increase profitability.