The Pandemic Closes 7 companies Every Hour, According to Endeavor

The NGO conducted a study with some perspectives that can help entrepreneurs adapt in times of crisis. Here are some of the results.
The Pandemic Closes 7 companies Every Hour, According to Endeavor
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This article was translated from our Spanish edition using AI technologies. Errors may exist due to this process.
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  • Every hour 7 companies close permanently, 13,700 Mexicans lose their jobs, and 1,366 people enter poverty.
  • Retail sales in e-commerce are expected to grow 20.9% by the end of the year.
  • One of the most impressive transformations in the digitization industry is that of food.

Endeavor Mexico released the results of its study called " Rehabilitation of the Post-COVID-19 entrepreneurial ecosystem ", which highlights that every hour 7 companies close permanently, 13,700 Mexicans lose their jobs, and 1,366 people enter poverty.

The organization comments that these figures are only for the stable employment sectors. However, more than half of the working population (51.8%, plus 4.1% since April) belongs to the informal sector, whose data is not available.

According to the study, the sectors most affected by the pandemic are: airlines, department stores, logistics, industrial, pharmaceutical and hygiene products, and energy. According to the Mexican Institute of Social Security (IMSS) , only from March to May of the current year at least one million jobs were lost.

Steps businesses took to survive

In times of a pandemic where social distance rewards, different companies have had to start or improve their online sales channels, as well as seek other sources of income so that their projects remain afloat.

In Mexico, retail sales in e-commerce are expected to grow 20.9% by the end of the year, as small and medium-sized businesses are accelerating their digitization efforts to adapt to the new normal.

Image: Bench Accounting via Unsplash

Likewise, the Mexican Association for Online Sales (AMVO) estimates that today 6 out of 10 SMEs sell their products through the internet, which represents a 94.6% growth compared to 2019.

The organization's study collected information from 60 entrepreneurs, whose companies represent a total income of $ 400 million dollars and employ more than 11 thousand people directly. Within the axes of analysis, various measures that companies have resorted to to face the new normal were identified and the following figures were detected:

  • 85% looked for new sources of income.

  • 85% paused or canceled non-essential activities or projects.

  • 82% renegotiated rental contracts.

  • 82% renegotiated contracts with suppliers.

In addition, it was found that regarding the home office, 78% of the surveyed entrepreneurs noted that their teams are more productive at a distance, since this saves them the daily trip to their offices and gives them greater performance and flexibility.

Buying food online: the new trend

One of the most impressive transformations in the digitization sector is that of food, since although supermarkets remain open, consumers have chosen to buy online as a safer way to maintain social distancing by forcing and avoiding physical contact . In the span of just two weeks, comparing the week of March 9-15 to the week of March 16-22, the number of visitors to online grocery stores in Mexico increased by roughly 15 percent.

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