Business survival post Covid and lessons from China, India
The Chamber Forum was organised by the Colombo Chamber of Commerce in collaboration with the Federation of Chambers of Commerce and Industry of Sri Lanka (FCCISL) under the theme: “In search of post-Covid-19 business survival”.
Drawing on the Indian experience of the Covid-19 outbreak, Federation of Indian Chambers of Commerce and Industry South Asia Regional Council Chairman Manoj Chugh said that using the experiences of the countries which were affected by the pandemic before India, the Indian Government took early measures to respond to the situation. He said the state and the private sector both set aside the profit motives and started focusing on saving lives.The Indian Government came out with the large economic stimulus package of $ 22.6 billion and various moratoriums were given to the businesses. Priority was given to direct cash transfers to the poor to buy food, gas, and other essentials, to ensure that no one is left hungry. The food security and insurance package for the health workers was established. Further, an announcement was made regarding the relaxation of deadlines to meet the statutory requirements at the end of the financial year. The impact on the industries is very large, supply chains have been disrupted, and small and medium-sized enterprises (SMEs) are badly hit which is over a $ 3 trillion economy. This is the harvesting season in India and it is very essential that the Government and related organisations buy the harvest from the farmers. This is a global issue and the entire world together should find solutions.
Sri Lanka-China Trade and Investment Council President Sun Lai Yung, speaking about the situation in China, mentioned that the spread of the virus commenced during the Chinese New Year. During this time, the schools and universities were closed and the workers had gone back to their villages to enjoy their New Year holidays. He stated that China took very serious action, even with a lot of criticism from the world, to bring the situation under control. He said the discipline of the public is very important to control a pandemic, and China was successful in controlling the situation because of the strict discipline they maintained. He also stated that to overcome the situation, the Chinese Government cannot dole out money and that entrepreneurs and industries have a vital role to play collectively.In reply to a question asked by the moderator, FCCISL Senior Vice President Keerthi Gunawardane, Lai Yung said that as a post-Covid-19 recovery strategy, Sri Lanka should attract overseas investors, and in the case of setting up businesses, allocating lands, registering businesses, and getting water and electricity connections to the factories, there must be synchronisation and it should happen very fast. He said in China these functions happen very fast and it creates an environment conducive to investments. Chinese investors are sensitive to these areas, and if the correct infrastructure is provided, many Chinese companies will invest in Sri Lanka.
National Chamber of Commerce of Sri Lanka (NCCSL) President Asela De Livera mentioned that agriculture is very important for a country like Sri Lanka and he stated that in the olden days, Sri Lanka was introduced as the granary of the Indian Ocean. He said we have rich soil and inland water reservoirs. The agricultural sector can accommodate a large number of workforce but the salaries have to be reasonable for them to remain working these jobs. He said modern agriculture should be facilitated by introducing better cold storage and efficient transportation by railways. He said the post-pandemic period should be used as an opportunity to develop the agricultural sector of Sri Lanka.
CCC President Saranga Wijeyarathne spoke about the social and economic challenges facing SMEs and micro, small, and medium enterprises (MSMEs) in Sri Lanka. There will be complex issues in these sectors, Wijeyratne said, adding that the Government must support this sector largely. During the Covid-19 pandemic, the SMEs and MSMEs also have to realise that there will be issues with regard to sustainability, customer retention, capital, cashflow, lower margins, and bottom lines. He cautioned the organisations not to panic or overreact. He highlighted the importance of maintaining confidence, identification of new opportunities, diversification, customer communication, communicating with your bank and other stakeholders to get the maximum support for your organisation, and learning how to operate with lower margins.In terms of post-Covid-19 customer behaviour, he opined that the customer pre Covid-19 will be totally different to the customer post Covid-19, and that companies must understand and analyse the behaviour of their respective customers. Spending will be restricted for customers since the purchasing power has reduced and customers may not be willing to pay premium prices for brands and will settle for generic products instead. He said the organisations that study its customer behaviour well will be able to respond to the issues faster.
Asia Pacific Trade Agreement Chamber of Commerce and Industries (APTA CCI) President Dr. Rohitha Silva spoke on the post-Covid-19 business continuity plan. He said business plans bouncing back in the Western world as well as in Asia must be looked at. This will give us an idea on how to look at our own organisations, he said. “First look at the crises and the problems faced by our organisations. Then we have to come up with the business plan for the next three months, six months, and one year. We should plan now and it is necessary to motivate our staff and communicate the plans to workers as well as business partners. Rethink your balance sheet and the strengths of your organisation and plan for the future with a correct idea on how you can get the support of the banks to improve your finances and possible bad debts too,” said Dr. Silva.He also emphasised that all organisations should look at working digitally, online support, virtual showrooms, etc.
Chamber of Young Lankan Entrepreneurs Immediate Past President Dinuk Hettiarachchi spoke on the financial discipline required during this crisis and said entrepreneurs have to work as crisis managers in their business even during the good times. In the post-Covid-19 scenario, he said all businesses can make use of financial packages offered by the Government through the banks. “If you want to be innovative then you can use the low interest loans offered by the Government and use the time to change your business to suit the crisis impact. You have to restructure your organisation and see what new things you can do and innovate at this hour; in other words the same production facility can be used to manufacture present high-demand items. For example, cosmetic manufacturing companies can switch to produce hand sanitisers,” Hettiarachchi noted.