If ever there was an occasion for those recurring “Keep Calm” memes, this is surely it. With economists predicting a grim global outlook as coronavirus tightens its grip worldwide, it’s certainly time for all businesses to rethink their 2020 plans, writes Leigh Rust co-founder and director of Safetyline.
With the Australian economy now so dependent on the Chinese market, we are precariously placed – even if our businesses appear to have no direct link to China.
Already one in six Australian businesses are reporting being hit by the effects of coronavirus, many of them experiencing supply chain difficulties.
That’s no surprise given China is now responsible for a third of all global production. Its own official measure of manufacturing output hit a record low in February with fears worse is to come.
Certainly, many Chinese factories and ports are closed, not only effectively halting supply of Chinese goods but also many components needed for further manufacturing or construction here.
While those dependent on Chinese products scramble to shore up alternative supply lines, Australian manufacturers shouldn’t be too smug.
As the director of a proudly “Made in Australia” business, I welcome the prospect of increased demand for locally-made goods but can also see the coronavirus fallout has the potential to severely disrupt Australian export markets.
Already some primary producers are unable to get their commodities through Chinese ports and there’s no doubt coronavirus-driven downturns will slow demand for Australian products overseas, no matter how well insulated we think we are.
On home soil, in my game, the construction industry, ongoing supply issues could also spell disruption to building projects around the country.
That uncertainty is never good for anyone, Australian manufacturers included. Already economic modelling is bandying around the R-word, recession, with growth rates forecast to fall from two per cent up to eight per cent in the worse-case scenario.
Even the best-case prediction, a two per cent hit to GDP, coming off the back of lower growth figures attributed to the bushfire season, is enough to tip Australia into recession. That prospect foments unease in even the most robust of business sectors.
The big end of town was swift in putting into place its coronavirus responses. Many corporations have advised their employees to cancel or suspend unnecessary air travel, to self-isolate if they’ve returned from high-risk countries and, with person to person transmission now emerging in Australia, to observe sensible personal hygiene measures.
As employers, big or small, it is incumbent on all businesses to provide a safe and low-risk environment for staff, customers and clients.
If you haven’t already, now is the time to make clear to your staff what your coronavirus strategies are: both in short-term risk mitigation and longer-term business planning scenarios.
Be prepared to be flexible with work from home arrangements where appropriate and provide adequate hygiene products in the workplace, encouraging employees to make use of them.
It’s also imperative to stay up to date with official government advice on travel, health protocols and risk-minimisation strategies.
For example, one piece of advice aimed specifically at the business sector is that it’s forgivable not to shake hands in the current climate, with suggestions a wave or verbal greeting will suffice.
Give your employees the OK to take up that option (even if it’s difficult to remember to do it yourself).
All in all, businesses can be forgiven for not factoring coronavirus into their 2020 plans but they can’t be forgiven for not acting now.
While there is no room for alarmism, it will certainly pay to be ahead of the game and set strategies in place.
As the old adage would have it, Keep Calm and Carry On. We should all be waving on that.
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