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COVID-19 Evolving frauds in Consumer Markets

COVID-19 Evolving frauds in Consumer Markets

In an unprecedented chain of events, the outbreak of COVID-19 has amplified the prevailing slowdown in the global economy, as well as in the Ghanaian economy. The lock down situation is likely to have a colossal impact on the economy. The preferences of customers have also shifted as they are exercising caution about where, what and how they make their purchases.

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The Issue

We still know little about the COVID-19  virus and its long-term implications. It has potentially led to multiple scenarios as follows,  which could lead to significant impact on  organisations in the consumer market sector:

•      Steep increase in demand of essential  products due to panic shopping leading 

to perceived shortage of products of daily  consumption

•      Augmented demand for delivery through  e-commerce channels and corresponding  rise in digital payments, especially for essential products, due to social distancing  obligations

•      Less demand for non-essential products  leading to operational disruptions and  consequent adverse impact on their  profitability and cash flows

•      Retail outlets, except grocery stores and  pharmacies, have shut their doors. Retailers,  particularly those with physical footprints,  are rethinking of their current cash positions  and trying to assess how they will continue  to pay the bills, should the downturn in  demand continue for a prolonged period

•      Disruptions in raw material supplies  due to closure of factories and import restrictions leading to adoption of alternative  procurement channels, which are likely to  be costlier and/or materials are likely to have  quality issues

•      Likely job losses and salary cuts, leading to  lower consumer spending.

© 2020 KPMG, a Ghanaian registered partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved.

KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved.

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