Dr. Oluwadolapo Conteh parades an enviable profile. Her decade long experience speaks volume in Relationship Management in both the Commercial and Retail Sectors. She is also skilled in Credit Analysis Structuring, Customer-focused Selling, Customer Service, Business Negotiation, Strategic Marketing, Credit Risk Management, Operational Risk Management, Financial Accounting, and Financial Reporting.
She currently sits at the helm of affairs in Babes Redefined, a female Facebook group with over a 100,000 membership in Nigeria and overseas. She also owns a blog where she shares her opinion on basic life issues.
Given the devastating effect of the COVID-19 pandemic on both lives and business ventures, medical specialists have continued their search for a vaccine for the virus, business experts are also looking for ways to keep their businesses thriving even in the face of harsh economic realities stings amidst lockdown and restrictions.
In the same vein, it has become imperative for consumer business owners to seek for means to redirect their ventures so as to remain relevant and afloat.
Dr. Conteh spoke to Daily Sun recently on some handy tips for business survival especially in the consumer market sector.
How would you rate the impact of the COVID-19 pandemic on some key economic sectors?
The negative impact is huge. For the Fast Moving Consumer Goods (FMCG), the pandemic led to the discontinuation of production activities, supply chain disruption with a higher cost of production inputs, distribution and delivery channels hampered due to restrictions in movement, increased logistics expenditure and time to market slower, increased demand in the short term due to panic buying, reduced cash flows due to decline in production capacity and an Increased finance cost due to cashflow issues.
also at the agriculture and agro-allied, the pandemic and lockdown triggered shortage and scarcity of inputs required for Agricultural production. Then there was increased cost of production due to scarcity of essential inputs and dependence on local supplies, increased challenges with supply chain and logistics due to clarity around restriction and closure of interstate borders, lower demand due to various social interventions by various state governments to cushion the effects of food shortage, insecurity and increased attacks on farms and spoilage and wastage of Agricultural products due to border restrictions and increased time to the market.
Then for General Commerce, there was a sharp drop in demand for non-discretionary goods due to reduced government spending and excessive savings with a reduction in customer’s purchasing power. Also, the supply chain was disrupted because of the closure of international and interstate borders, pressure on alternative distribution channels, increased cost of production for imported goods with the devaluation of the nail, and increased redundancies due to a drop in revenues. These and many more were how these sectors where affected.
There seemed to be a united global response to the outbreak of the pandemic. In what ways did businesses leverage on these measures?
Most countries responded by instituting a partial or total lockdown of their economies, for example, closure of borders with travel restrictions, and enforcement of social distancing with attendant effects on how businesses are conducted.
Also, nearly all firms took proactive measures to protect their people and to curtail the spread of COVID-19. These include restricting travel and taking other prevention-oriented policies, emphasizing workplace hygiene, offering alternative ways of working, and initiating proactive communication. Most firms were forced to go back to the drawing board to review issues such as staff compensation, disengagement of staff in order to cut costs, terms of agreement with stakeholders in order to ensure continuity of the businesses beyond Covid19. Unemployment rates increased enormously with corporate redundancies in affected sectors such as the airline sector, oil, and gas, customer durable goods, transport, and entertainment in most affected countries of the world.
Businesses were forced to review their operations in order to identify the most critical processes required for the survival of the business while doing away with other trivial ineffective processes that are not useful to surviving the epidemic. Most financial institutions were able to successfully move their customers to alternative channels with majority of staff working remotely due to the lockdown in most parts of the world.
Firms also leveraged digital technology to continue to provide services to their customers in order to comply with rules of social distancing. Customer and staff engagement was practically conducted through the digital platforms, with the creation of digital meeting rooms and automated call centers in order to keep up with the social distancing rules and curtail the spread of infection. Online learning opportunities have also increased with Ivy league institutions offering various opportunities to learn and acquire certificates online.
Can you describe how the COVID-19 scourge has exposed Nigeria’s economy to another recession?
Large-scale quarantines, travel restrictions, and social-distancing measures drove a sharp fall in consumer and business spending until the end of Q2 (second quarter). This produced a Recession. With consumers staying home, businesses lost revenue and laid-off workers, unemployment levels rose sharply, business investment contracts, and corporate bankruptcies also soared, thereby putting significant pressure on the banking and financial system.
The Nigerian financial system is insignificant distress with fiscal and monetary-policy responses also proving insufficient to break the downward spiral with a recession looming in most countries of the world. The global economic impact is severe, approaching the global financial crisis of 2008–09. GDP contracted significantly in most major economies in 2020, and recovery is projected to begin in Q2 2021. Nigeria appears to be one of the worst-hit economies due to its large dependence on oil, being forced to slash production with the global oil price slump induced by the Corona Scourge. With oil accounting for 60% of government revenues and 90% of foreign exchange, the government is far below its budget benchmark. Standard & Poor (S&P) downgraded the country’s long-term credit rating further into junk territory, from B to B- with a decline in crude oil revenues.
There have been several interventions by the Federal and State governments and private institutions to provide palliatives to ease the effect of Covid 19 on the economy addressing food security and the CBN offering stimulus loan packages to farmers and manufacturers via the commercial banks at special rates. The IMF approved US$3.4bn in May in support of the country’s efforts “in addressing the severe economic impact of the COVID-19 shock and the sharp fall in oil prices”. The loan was approved under the Fund’s Rapid Financing Instrument.
As a business expert, are there on opportunities for businesses to explore in other to remain in business?
With COVID, there is a new normal with lockdown being eased in the past few weeks all over the world especially in developing economies where there is little support from government to private institutions. There also seems to be no end in sight to the upsurge of infections globally especially with a deficit of health professionals and medical facilities becoming swamped. It is therefore imperative that businesses must, therefore, learn to adapt while taking advantage of the numerous opportunities presented by the dire situation. All innovations must put into consideration the need for social distancing, staff welfare, hygienic work practices, and the safety of products and services. The situation is an opportunity for organizations too to have a rethink of their business models and introduce changes to adapt and survive.
What would you recommend as survival strategies for these businesses?
For organisations into FMCGs, they should endeavour to implement Health and Safety Measures to assure employees of their safety in the workplace. Then they should deploy digital platforms to enable noncritical staff to work from home or on a rotational basis. They must also leverage automation production solutions to ensure production can continue with little human intervention. Companies should ensure supply chain realignment, and explore multiple supply options, develop and test run the contingency supply options, locally sourced inputs, and alternative facilities that can be relied upon. Businesses should rapidly explore alternative and cheaper financing options and negotiate loan repayment terms with lenders in view of the Covid situation.
For the Agriculture and Agro-Allied sector, the business owners should explore the different stimulus packages for Agriculture rolled out by the Federal Government. They should also explore the different supply chain logistics to reduce costs and optimize production. Also, adopt the digital platforms and social media to engage customers and increase sales, prioritize digital payment solutions for transactions consummated. Organisations should cononsider cost optimization opportunities within the business to encourage profitability, and encourage partnerships and engagements with governments both at the State and Federal level to solve food supply and distribution issues.