Five things businesses can do to maintain and strengthen their operations during and after the outbreak of the Coronavirus disease (COVID-19).
Within a few months, the disease caused by the Coronavirus (COVID-19) has spread globally, leading to economic and social crises in many countries. At this stage, it is difficult to predict how long this crisis will last and how it will impact the private sector. Based on the survey data of the Ho Chi Minh City Handicraft Association and Wood Processing Association (HAWA), here are five things businesses can do to maintain and strengthen operations during this difficult time.
Prioritize safety issues for employees
Prioritizing your workforce safety is prioritizing uninterrupted performance for your business, as an infected worker could result in the closure of an entire business. To ensure the safety of employees, businesses should conduct a thorough risk assessment in business operations, combining the application of appropriate administrative and technical control measures, implementing labor safety measures, and distributing personal protective equipment to protect workers from infection. Businesses should also use guidelines issued by health agencies to raise employee awareness, regularly adjust existing safe operating procedures, and train staff on how to prevent viral infections, including proper use of labor protection equipment.
Communicate clearly and consult employees
According to a survey conducted by HAWA, 61% of enterprises reported that only 60 to 80% of workers returned to work after Tet holiday, while other workers quit their jobs due to fear of infection or stay home to care for their children when schools are closed. Providing consistent and accurate information is the key to regaining and keeping the workforce's confidence - employees need to know that their well-being is a business priority. Being a wise business owner, you should ask your employees about their worries regularly and accept their ideas so they can take the necessary measures to help preserve your workforce and your business.
Cash flow management
HAWA survey data shows that 59% of businesses have reduced orders after Tet, 96% of businesses have bank loans and are under pressure on interest rates and repayment periods, and revenue is likely to plummet this year. Some customers will be late or unable to pay for their expenditures. What can businesses do to improve cash flow?
It is necessary for enterprises to calculate the fixed and variable costs, then estimate how long a business can survive with cash reserves and convert fixed costs into variable costs if possible. Moreover, they should also review their capital investment plan and priorities to cut back on investments as needed. Focusing on managing inventory is also advised, as your business may need more materials due to supply chain disruptions, however, leaving too much capital in the inventory is also ill-advised. In addition, negotiation on a payment schedule and alternative financing options with suppliers may also be beneficial for you.
Assess risks in the supply chain
From HAWA's survey data, 73% of businesses face disruptions and delays in the supply chain, including a longer time of importing raw input materials, the lack of goods, and the increasing costs. While the situation in countries like China has gotten better, the disease is still developing and businesses with supplies from Europe and the US will soon face disruption in the supply chain. However, enterprises will find potential loopholes if they understand their supply chain. You should start with the most important products and do not limit yourself to tier one and two suppliers. Finding more suppliers can help businesses reduce the risk of running out of raw materials.
Reviewing crisis management plans and ensuring business continuity
Every well-run business has a crisis management plan or an ongoing business assurance plan. Your business may have used this plan, but this is the time you need to regularly adjust the plan and prepare to respond in case the situation gets worse. Planning under scenarios will help businesses better understand development trends and provide appropriate solutions. Moreover, you need to Include emergency notification in your business continuity plan and specify clearly who will convey what content, how and who to communicate when the crisis occurs.