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COVID-19: Local business owners must prepare for a ‘new normal’

Cambodia’s American Chamber of Commerce (AmCham) held a virtual seminar yesterday providing advice to local business owners about preparing their organisations for the next phase of business after COVID-19 restrictions are lifted.

Key speaker Jay Acharya (Consultant at The Capacity Specialists), stated the current level of mass closures by governments to stop the initial spread of COVID-19 will not be sustainable and governments will have to eventually allow businesses to reopen.

However, Acharya outlined that when this next phase does emerge it will be from the deepest recession in 100 years and into a world of bigger government, higher national debt, higher corporate debt, higher unemployment, higher underemployment, higher self-employment and increasing inequality.

He added, “That the virus will be a major factor for business for at least the next five years and owners should not assume a smooth upward recovery,” referring to a possible state of mini-cycles that sees a constant change in business conditions.

The seminar followed on from discussions from the previous AmCham event held last month when industry leaders complained that the Cambodian Government was not providing enough framework to industry on their exit plan from COVID-19 restrictions.

Well-known chef and Cambodia Tourism Federation representative, Chef Luu Meng said his sector understands that while health is paramount, he urges the government to provide set dates and guidelines for businesses to eventually reopen.

“Set dates are needed because hotels and restaurants can take weeks to ensure they are properly staffed and stocked. The government should look to both Thailand and Vietnam because they have created set dates for the hospitality community,” he said to the business panel.

In response to these extreme unknown conditions once business does reopen Acharya stated that organisations needed to focus on four sectors of sustainability across their entire business model.

  1. Financial sustainability: The businesses that went into this crisis without a robust balance sheet built from healthy margins, prudent financial management and/or abundant capital have disappeared already or will soon cease to exist. Many of the survivors will be laden with increased debt in a world of rising interest rates and cash-strapped customers.
  2. Social sustainability: The businesses that chose to retrench people without financial assistance will be treated as pariahs and boycotted. Those that looked after their people and society at large during this anxious time will be rewarded.
  3. Environmental sustainability: More than 4 million people die every year, globally, from air pollution – which also makes people more susceptible to COVID-19. The shutdown of industry and travel has saved hundreds of thousands of lives. Businesses’ environmental credentials will be scrutinised even more harshly than before.
  4. Strategic sustainability: Companies without complete clarity of why they exist, who they exist to serve, what makes them different and what they need to do to deliver will definitely find it almost impossible to compete.

“Reopening will be more than a restart. It will be the beginning of a new era of business,” Acharya concluded.

This article is originally published in the KHMER TIMES