Business opportunities after the Covid-19 perspective from BCG, a global consulting firm
Covid-19 Virus Crisis causes change and brings severe consequences throughout the world amidst the uncertainty that occurred. Khun Isada Hiranwiwatkul, Managing Director and Partner, Boston Consulting Group, Thailand (BCG), the world's leading consulting company, has analyzed the guidelines that the organization, business owner and entrepreneurs will use to adjust to accept this big change situation. With investment experts, Khun Sornchai Suneta, Managing Director, Chief Investment Office, SCB Securities Company Limited participated in the discussion
How should businesses adapt to this crisis?
BCG has been a world-class consulting firm for 57 years, established in Thailand for 25 years, and provides consulting services for many industries including banks, telecommunications, energy businesses, etc. Khun Isada said that in the current situation of the Covid-19 virus, the client company has asked for the following key issues: 1) supply chain management in which this crisis was disrupted, partially cut and how to find a way to support 2)How to reduce costs in the company to support the crisis Including the opportunity for COVID to return in the future 3) Re-imagine the image of what would be like a new normal image after. Because some New Normal businesses will not go back as before the crisis because the structure of demand, supply (Demand-Supply) will change completely. And what strategy will be prepared to handle when that event arrives?
Where is Thailand in the crisis of the Covid-19?
In the opinion of BCG, the situation of Covid-19 is divided into 3 phases, namely: Flatten, who was clearly in a recession. Because the number of people infected is steadily increasing. The next phase is Fight, the fight phase is a turning point before reaching the future or the Future phase in which everything will return as before. Which in this fight phase is dangerous periodically fearless, as if driving at dusk, don't know how to proceed. Moving forward is not sure. IF you stop waiting, you may lose the opportunity for competitors. Thailand is currently in the Flatten phase before entering the Fight phase.
Khun Isada commented that when entering the fight phase, most people think that the business sector is open, everything will return as before. But, from many countries that have unlocked the down Then there is a chance that COVID will return to the 2nd round. This may cause more damage than the first round, Therefore, even after returning to open the city, it still cannot be trusted. As for the question of how long Thailand is in danger, the answer is 1) Can medicine be treated? For example, when a new flu pandemic Found Tamiflu drug that is effective for treating 2) Having a vaccine to prevent the COVID virus 3) If there are no two of the above, waiting for herd immunity will take quite a long time. According to the latest BCG data from early May 2020, it is expected that the fastest effective medication to be released is another 6 months. The vaccine is expected to take around 12 months because after the FDA has passed the mass production process and distributed to countries around the world. Therefore, in the next 6 months, we still must be in a fearful state (Fight phase).
After unlocking Will the economy recover?
As for the impact on the Thai economy, The SCB EIC Business Economics Research Center forecasts negative GDP numbers of -5.6%. Which, if the city opens in this 3-4 quarter, the economy should improve. In this section, BCG sees economic recovery difficult to predict. It depends on the country and the business sector as to what the recovery pattern will be. Although some businesses, such as Delivery, are not affected a lot. But in many business sectors that demand has decreased the chance of a sudden recovery (in a V Shape shape) is rare. But whether to be a gradual recovery (U Shape) or not depends on the type of business If some businesses structure the demand for the supply and consumer behavior has changed causing demand to not return to the original, it will become L Shape, which is not coming back as before the COVID period.
How did Covid-19 change consumers?
From BCG researching and surveying consumer behavior. A survey of Thai consumers in the past month found that what people spend less are going out to eat, going to the movies, recreation. Although many people think that after opening the city People will return to spend the same amount, BCG points out that most consumers have become satisfied with their stay. Become less demand in the future. The more people will spend, such as the delivery of food with the information that in April, some fast food businesses, deliveries increased 2.5 times over the same period last year. Next is health care products. (Preventative Healthcare) because people are more health-conscious and want to prevent illness from the cow virus. Which includes vitamins, supplements
and health insurance that is a risk prevention tool and easier to buy convenience stores or applications.
There is a question of whether consumer behavior will change permanently like flight behavior after the 911 incident. In the perspective of Khun Isada, some behaviors will change quite permanently. Such as ordering food online delivery which previously had already. But Thailand still uses less compared to other countries. The emergence of COVID is a catalyst (Catalyst) for people to change their behavior to order more online.
9 principles for entrepreneurs to seize opportunities in times of crisis
Khun Isada spoke about the changing business model to seize the opportunity even in times of crisis.
With the epidemic situation of the Covid-19 virus Despite causing many uncertainties and risks to the business sector, Khun Issada sees that there are opportunities for risk. Adaptation is important for enabling entrepreneurs to seize opportunities during a crisis.
Source: SCB TV, Opportunity in the Crisis of Covid-19, Part 1, Identifying Business Opportunities after COVID-19 via analytical perspective from BCG and investment experts from SCBS on Facebook SCB Thailand, 12 May 2020