Here's How SMEs Are Affected and Fighting COVID-19 Coping up with post-COVID 19 scenario is the biggest challenge for small and medium businesses
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According to a survey, only 3-4 per cent of small and medium businesses are backed by strategies to sustain in the post COVID-19 scenario. The slowdown in the economy due to the pandemic has made it critical for SMEs to address these concerns.
In a webinar conducted by Entrepreneur India, panelists shared their opinion on how to control business handicaps caused due to this pandemic. From the strategic plan, possible measures to their valuable opinions, the session was meant to understand their respective visions towards business growth post-COVID-19. Here's an excerpt from the discussion which touched upon various aspects to be focused by SMEs to bounce back.
Deepak Bagla, Managing director & CEO Invest India
Bagla reflected over the need to reimagine business thoughts in terms of the current circumstance. He pointed to the emergency issue of the supply of essentials. Invest India is working with the food industry, the medical industry, and other industries that are vital during these tough times.
Another of Invest India is focusing on life after COVID-19. Bagla believes this can help to bring the economy back to normal. Deepak stated MSMEs are the strength of his organization and they need to be brought into action as soon as possible. He hinted at new plans to get the labour segment getting in action.
Arun Maria, Management consultant, former member, Planning commission and former chairman, BCG
His personal struggle pushes him to think about what it takes for a small enterprise to grow and what all problems do they overcome. He was a director in charge of Tata Motors at that time.
He firmly believes this time will pass and all of us will together overcome this crisis. But now we have to make sure that if again such a situation comes small businesses do not suffer. MSMEs can help the government effectively.
Giving loans to large enterprises is easy, hence MSME can help to reduce the gap between people and large enterprises.
Maira added, "India has the weakest quality of small enterprises' cluster as compared to other countries, so we can improve our nation to build the strongest cluster."
Ajay Thakur, Head- SEM & Start-ups BSE
Thakur mentioned that GDP growth is falling to the lowest in the last 10 years. So the risk has been increased as investors take a step back from the SME platform.
But, now a situation panic is arising keeping investors in dilemma. Even at this time money is going out from India to another country which is decreasing the confidence level.
He even opined that the motion of support in the form of debt is lacking.
We have to concentrate on demand and supply chain, whether it's going to have some level of growth before India was affected by COVID-19.
He thinks that it will take around one year for everything to become smooth in the business sector.
Thakur suggested that the government should come up with schemes that are beneficial for all the people of India. He also shared his optimistic vision that everything will be innovative after this pandemic scenario.
Abhishek Singh, Chief Analytics officer, Lendingkart
Singh quipped that there are some industries that haven't been affected as much. Industries such as pharmaceuticals and groceries, also a few parts of macroeconomics. Automobiles and consumer durables are also the ones who haven't been affected a lot.
In the travel space, hospitality is the industry that would take a longer time to get back on feet.
Lendingkart is targeting to create short-term capital products by providing loans for 6-12 months. Once businesses recover, the firm will start with long-term loans.
Saikat Roy, Director, and head of SME, CARE Ratings
Roy mentioned that once the lockdown gets over, CARE will look over the cashflows. His team will divide companies into two categories—discretionary and essential commodities—for evaluation purposes.
In some areas such as the entertainment sector, the travel sector incurred revenue loss. The quantum of lockdown is being looked upon. According to the poll conducted by his team, it was witnessed that if the lockdown lasts up to 4 months, then, 20-25 per cent of potential MSMEs will look for closure. He also indicated that severity will be impacted manifold in such circumstances.