COVID-19 Impacts on Businesses: are Businesses benefitting or suffering?

By Sofia Arts Romero and Manon Goirand

The current COVID-19 outbreak is having a huge economic impact on several industries, ranging from the small, local businesses to large, successful companies, all of which are experiencing tremendous changes as the economy weeps. But how exactly are these companies changing? Are they all suffering, or are some actually making the most of this pandemic? Indeed, for certain companies, more so online businesses, it is economically benefiting, such as department stores, video call apps, and gaming companies. However, sadly, there is a huge portion of businesses that are suffering, some even filed for bankruptcy in a matter of weeks. Let’s take a closer look into specific companies that have been changing because of this:

One of the most benefiting companies during the outbreak has been Amazon, even though it is merely a surprise. When looking at the stock markets since the beginning of March, when the outbreak penetrated most of Europe and later spread worldwide, we can see that Amazon - considered one of the big four tech companies next to Google, Microsoft, and Apple - has substantially increased its= stock and sales, reaching over 2,400 USD in stocks on the 24th of April. Since people started quarantining, households have taken to online buying, ranging from a variety of products such as cooking utensils, board games, electronic devices and games, furniture, clothes, and many other products, thus benefiting the company. However, due to a coronavirus outbreak at an Amazon warehouse, the company has been suspended for two weeks in certain countries due to sanitary reasons and has only been allowed to receive orders for essential products, such as food and house staples, as well as medical supplies. To that matter, it is more than likely that after this suspension period Amazon will be overwhelmed with orders once again.

Additionally, industries such as gaming are also substantially changing per day. The coronavirus has both a positive and negative impact on the gaming industry. Indeed, on the one hand, the sales of games have considerably increased since the beginning of the outbreak. Gamers streaming on platforms like Twitch lead to significantly more viewers now. On the other hand, huge popular gaming events, like competitions and conferences worldwide, such as the Game Developer Conference (GDC), have been canceled or postponed. New consoles and game releases have also been delayed due to production problems, thus creating a shortage of products. This is an interesting industry to look at, as its positive impacts are leading to increasing demand and thus negative impacts on production.

Unfortunately, the businesses suffering the most from the pandemic are local businesses, including restaurants, bars, local shops, and others, as well as entertainment and fitness centers, and travel companies. In fact, airline companies are facing difficulties as they collapse and file for bankruptcy because of the pandemic as people are not allowed to travel. Airlines will likely face a slow recovery once the outbreak is over, but it does not look promising in the next year. Additionally, local businesses are permanently closing as they are unable to sustain their small businesses. Other businesses that are lucky enough to reopen will likely stay closed until at least July for some European countries. For this reason, we cannot stress enough to support your local businesses as much as you can, whether it is by ordering takeout food from your favorite local restaurant or buying online products delivered to you from your favorite local store - if they have these options available. In the case that they don’t offer these services, make sure you support them as much as you can once they reopen again!

To conclude, this pandemic has had several economic consequences on businesses, either positive or negative economic effects. As the confinement continues, it will likely only lead to more trouble on the overall global economy, which is why an aspect to pay attention to is how the economy is going to fare by the end of the quarantine, if a boost will be appearing or if it will continue to suffer. Therefore, we recommend staying up to date with the news and being informed about the current situation in order to know how to act in these tough times.

Don’t forget to stay home and safe! See you in our next journal!

18-05-2020