Impact of Covid-19 on different industrial verticals
Published | 05 April 2020
BlueWeave Consulting, a global leader in market research, closely tracks the effect of COVID-19 (coronavirus) on industries worldwide. To offer you details about the industries that concern you, your customers and prospects. Check back regularly for updated information or contact our Client Relationship Manager for additional guidance.
Case growth has accelerated to more than 1,203,130 cases and 64,744 deaths as of April 5.
The outbreak of coronavirus is primarily a human tragedy which affects hundreds of thousands of people. It also has a growing influence on the global economy. Since there is no vaccine so far to prevent the spread of coronavirus disease 2019 (COVID-19), the only option people have is to reduce exposure to the virus. This is achieved by social distance measures, personal hygiene measures and avoiding contact with the infected person.
Such limitations contribute to a slowdown of industry in some sectors, although there are those which are least affected by the pandemic. Technology, healthcare, food & beverages, supply chain, oil & gas, sports & entertainment, travel & tourism, Fintech etc.-let’s analyze the effect of COVID-2019 on these industries.
Coronavirus has a mixed impact on tech enterprises. As work-in-isolation policy is an employee’s mandate, there are companies that make the most of it in terms of revenue profit. For instance:
- Slack Technologies Inc. states that there is an increasing trend in workplace-collaboration software due to the global effect of COVID-19.
- Zoom, an enterprise video communication solution, is one of the most frequently downloaded business applications on the US Apple Store during the second week of March 2020 (according to App Annie).
As technology firms have closed their offices and shops, limiting their executives to travel to the affected countries, the supply chains have been adversely affected. At the other hand, IT firms, more than ever, are recognizing the advantages of outsourcing. Remote job was preferred in the COVID-19 and therefore operations such as software development and maintenance are least affected by coronavirus.
Drug research and development has historically been a global endeavor with China and India establishing themselves as the key players in the global supply chain of pharmaceutical products. After the increase in cases of coronavirus in Wuhan, the pharmaceutical industry was concerned that the decreasing Chinese production capacity would lead to drug shortages.
The majority of pharmaceutical factories in China have reopened their production lines, the concerns of the pharmaceutical industry are heightened by countries such as India restricting the export of dozens of active pharmaceutical ingredients (APIs) and medicines produced from them, the United Kingdom banning the parallel export of more than 80 drugs to protect supplies during the coronavirus outbreak, and the United States and the EU looking to protect supplies.
Pharmaceutical and biotech firms around the world are collaborating with governments to address the COVID-19 epidemic, from funding vaccine production to supply chain issues in medicines preparation. Hospitals are still overwhelmed by patients with COVID-19, and are required to deprioritize trials. Patients are also apprehensive about participating in trials. In such a case, it becomes important for organizations to define steps to reduce trial time slowdowns or clinical trial success.
Food & beverage industry
Globally, the food & beverage industry is expected to experience the differential impact of this rapid spread of COVID-19 on each stage of its value chain through the mediums of the affected industrial workforce, the supply of raw materials (agricultural products, food ingredients, intermediate food products), trade & logistics, uncertainty in demand and unpredictable consumer demand for food services Production, distribution and inventory rates across the food & beverage spectrum projected to be affected.
Supply chain industry
Global impacts on supply chains have been predominantly the consequence of China’s bad situation. First, it has an effect on the supply of inputs to many manufacturers and retailers worldwide, and this is significant as China is an enormous source of components and finished goods. The longer plants in China are inactive, the emptier the global pipeline of components and parts around the globe is planned to feed producers and retailers around the world.
Secondly, China is also a vital goods and services market. Local economies, which depend on China as a customer, feel the effects anywhere in the world, as consumers in China limit their travel and consumption, and as producers in China slow down or suspend their production.
Oil & gas industry
Global demand for oil is expected to decline in 2020, as the Covid-19’s influence expands all over the world, limiting travel and broader economic activity. Travel restrictions and staff quarantines due to extreme safety measures will continue to limit jet fuel use and slow down industrial activity in the coming months, first in China and now in Europe and the US. Declines in sharp demand in Asia, particularly China, are unlikely to return to normal, at least until mid-April. This has resulted in exporters searching for alternative storage and refining destinations, such as the broad wholesale market in Europe.
Global demand for oil in 2020-Q1 lost nearly 3 million barrels per day (b / d) due to COVID-19 outbreak. The lockdowns and travel restrictions imposed in some of China’s major cities have contributed to the country’s declining consumption of petroleum products. Due to labor shortages, Chinese national oil companies have also limited refinery production.
- In February 2020, state- Chinese refiners announced a 940,000bpd cut in refining throughput for the month of February. Downstream projects under development, such as Jieyang, Lianyungang 2, Dayushan Island Phase Two and Zhejiang Petrochemical Daishan Xylene Plant Two, may potentially see some delays in execution due to supply chains disturbance in the context of travel restrictions.
Sports & Entertainment industry
Coronavirus epidemic adversely affects the entertainment industry. However, as more people remain at home, in self-isolation, and take quarantine initiatives, the use of digital entertainment platforms such as gaming, video-on-demand, etc. is growing. The effect of COVID-19 on video streaming companies including Netflix, Amazon, Disney+ is expected to increase in the number of subscribers.
Travel & Tourism industry
The coronavirus epidemic significantly affects the travel & tourism industry. Despite COVID-19 being a pandemic, people avoid travel to various countries and cities, which has adversely affected the travel industry and impacted the tourism benefits of the countries affected. Airlines are cutting frequencies and travel prices significantly, as more people prefer not to travel during the outbreak. Global airlines could lose $113 billion in revenue if the coronavirus continues to spread at this rate, according to the International Air Transport Association (IATA)..
The spread of COVID-19 has emerged to be the biggest threat to the global economy and the financial markets. Looking at the short-term effect investors make safer business investments. This means less participation in the stock market, and a negative effect on VC funding of established and emerging fintech firms.
The Fintech industry has seen a decline in transactions at all rates. Since individuals are self-isolated to defend themselves against the spread of COVID-19, they spend less than normal, contributing to a low transaction rate. In reality, cryptocurrencies like Bitcoin, Ethereum, experienced a big dip in the effect of coronavirus.
Find below related report:
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- COVID-19 Test Kit Market by Type (Equipment and Extraction Kits, rRT-PCR Test Kits, and Reagents9 (rRT-PCR Enzyme Mastermix, Human Specimen Control and EUA Positive Control), By Application (Detecting Virus, Monitoring and Others), By End-User (Hospitals, Clinics, Pharmacy Store, Pathology Centre and Others), By Region (North America, Europe, Asia Pacific, Latin America, and Middle East & Africa); Trend Analysis, Competitive Market Share & Forecast, 2020-26
Publish Date: March 2020
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