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.
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.
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