Business

Virus may force firms to alter work style

New template: The face mask would become a part of regular attire as people will have to strictly follow hygiene.

New template: The face mask would become a part of regular attire as people will have to strictly follow hygiene.   | Photo Credit: -

Social distancing, decluttering may impact businesses dealing with people

With COVID-19 bringing normal life to a standstill, several sectors, particularly those dealing with people, are likely to be hit hard, while other segments may have to rejig their work strategy.

Some of the businesses that are likely to bear the brunt are from the travel and tourism sector — namely airlines, hospitality and travel agencies. Other segments such as education, malls, theatres and restaurants will also be impacted.

“The wedding eco-system could take a hit like travel and tourism. Education could partially move online. Work places may have flexi-hours to reduce the crowding on the transportation system,” said Ambareesh Baliga, an independent analyst.

Religious and cultural events could take a backseat with limitations on head-count due to social distancing, he added.

“Mom-and-pop stores could be back in business with lesser footfalls in malls. The commercial space requirement may contract, whereas spaced out residential requirement could increase as decluttering gains pace,” Mr. Baliga said.

He said in future people may have to pass through disinfectant chambers and follow hygiene more vigorously.

“The face mask would become a part of our attire. People will avoid places that are generally crowded and may prefer to watch movies at home than going to a theatre. While restaurants may take time to witness footfalls, home deliveries could see a spike. Our buying habits will shift online much faster than we have seen in the past,” Mr. Baliga said.

The ongoing travel restrictions which are expected to continue have severely impacted airlines and the hospitality business.

“The trajectory of the resumption of operations will be driven by the demand for travel, which would have clearly been damaged by the severe human and economic costs that COVID-19 is inflicting,” said Kapil Kaul, CEO and director, CAPA Advisory.

“Given the tremendous uncertainty around the duration of restrictions, projecting how long it will take the economy to normalise is fraught with risks. However, based on our understanding of the aviation system in India, our assessment is that the Indian aviation sector is likely to shrink significantly, even if some of the vulnerable airlines manage to survive,” he said.

Stating that from a point of complete suspension of travel, recovery would be slow, he said, “Demand will be suppressed due to economic dislocation; slow or even negative GDP growth; broken supply chains; low consumer confidence; and concerns about lingering outbreaks of COVID-19.”

The combination of COVID-related travel restrictions and an economic downturn is likely to result in 1QFY2021 being a virtual washout for the Indian industry, he said adding airline will be saddled with over 200 surplus aircraft.

As per CAPA estimates, domestic traffic is expected to decline from an estimated 140 million in FY2020 to around 80-90 million in FY2021. International traffic is expected to fall from approximately 70 million in FY2020 to 35-40 million in FY2021, and possibly less.

The co-working segment is also seeing changes.

“Even though there has been a slowdown in the market, it is still early to assess the impact on the co-working industry. Decision making is slow, and deal closures will take longer than usual, but we believe this is a temporary situation,” said Neetish Sarda, founder, Smartworks, a co-working company.

“Due to the increased pressure, the co-working industry might see some consolidation soon. Companies are readjusting their operations to ensure business continuity. For us, the enquiries for completely managed office spaces have increased in the past few weeks,” he said.

“Going forward, companies will stay cautious and ramp up regular workplace hygiene and sanitisation practices. We see ourselves closely working with our clients and monitoring and tracking necessary details like their employee travel history, early follow-up, or scanning of any warning signs related to health hazards. We will continue with our measures for our workspaces infection-free,” he added.

Ravi Saxena, managing director, Wonderchef, said malls may suffer due to long waiting time for entry. Multiplexes and food courts are crowded places where social distancing is simply not possible.

“This means the business would spill over to digital platforms and also neighbourhood kirana stores. E-commerce is the oil that can keep the economy lubricated in this challenging time. Home deliveries are actually the safest form of consumption. They will prevent community spread drastically,” he said.

Murali Ramachandran, CEO-India, Celebi Aviation Holding Inc., said the aviation industry, being at the centre of the coronavirus pandemic, is probably the most impacted.

“The situation has become quite concerning now. There has been a steep fall in the number of flights being handled. It is almost negligible now. With a work force of over 8,000, we might have to take up some extreme decisions like ‘leave without pay’ and other measures as an alternative to try and secure our market viability,” he said.

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Printable version | Jul 11, 2020 4:55:37 AM | https://www.thehindu.com/business/virus-may-force-firms-to-alter-work-style/article31274211.ece

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