The main impact of the COVID-19 pandemic on businesses is reflected in the havoc that this pandemic has caused to the global supply chains. Mainly, many suppliers could not produce goods for a while due to safety restrictions. Others could not deliver them due to overloaded ports, extremely high freight rates, and displaced shipping containers, among other issues. Although the pandemic’s effect had lessened over the last year when the vaccines were introduced and people were allowed to leave their homes, the effect of this global catastrophe on the supply chains prevails.
The most significant impact of the pandemic and the changes within the business environments are seen with small businesses. This can be seen in the example of Amazon’s growth, which was picked during the beginning of the pandemic. As people were ordered by their governments to stay at home, the majority of consumers chose online shopping to satisfy their needs. Hence, the customers ordered most of their items online, including groceries, clothes, personal items, and other things. Amazon was thriving with its ability to deliver goods through its developed system of supply chains, while small brick-and-mortar stores were forced to close because they could not sustain not having profits for months. Moreover, these small businesses did not have the finances to invest in establishing websites and delivery services. Apart from this, Amazon has been accused of using data from its small suppliers to popular copycat items and selling them under Amazon’s brand. Hence, the internet retail giant has the resources and capabilities to overshadow any small business, which makes the competitive environment very challenging for small businesses, even in the post-pandemic times.
Evidently, the lack of the company’s ability to get goods from suppliers has become one of the major threats to the business’s growth and development. Hence, in the post-pandemic time, executives will have to rethink the role of supply chains in their strategic plans and dedicate more attention to creating supply chains that are effective. Moreover, even when the freight rates reduce to their previous levels, the executives might want to rethink where they purchase their goods and choose local suppliers over the ones in China or developing states. This option would be safer in the case of another disruption, and considering the ongoing issues with shipments that companies currently experience, the higher cost of local suppliers can now become comparable to the low cost of production overseas combined with high shipping rates.
I think these changes in the supply chain’s nature and consumer behaviors will be permanent, and businesses should restructure themselves to prepare for the new challenges. Mainly, over the two years that the pandemic has been active, consumers have gotten used to purchasing items mostly online. This is both convenient and allows one to save time and effort, and it is unlikely that consumers will revert to offline shopping when all of the restrictions are lifted. As for companies, many executives had to find ways to support their operations when the supply chains were disrupted. These new approaches allowed businesses to thrive during the pandemic, and it is possible that these business models will continue to be used in the future. Therefore, the changes in the business environment caused by the pandemic will most likely prevail in the future.