Since the spread of Corona Virus (COVID-19) has increased; the manufacturing sector has planned to shift their units from China; emotional and Economic backlash against China is expected. COVID-19 have proven to be disastrous for China in 2020. Already, countries and companies are working on a strategy; to do away with China as part of their supply chain strategy. Japanese Govt has announced packages for its companies bringing back manufacturing home. Let’s further discuss the disastrous effects of COVID-19 in 2020.
Before the rise in the COVID-19 pandemic, the electronics industry witnessed modest growth globally. Electronic companies in India which are dependent on imports from China; are hoping that the effect of the COVID-19 outbreak would ease in the coming months with several factories in China ramping up their production after reopening.
However, hurdles rose in logistics, reduced footfalls in stores, and a drop in demand with the rapid spread of the virus to other countries, including India, have emerged as new challenges to the brands.
As the ongoing season proves to be a carnival for Consumer durables major, but it has given a blown away due to the upheaval in the normal flow of time. As they fear that they will lose out on peak summer sales as the ongoing lockdown is likely to have a severe impact on sales of air conditioners, refrigerators and other white goods.
Due to this outbreak, the consumers will also put a halt in their spending on the purchase of premium white goods products which will result in reduced demand. The COVID-19 impact will be felt on sales of appliances from March through May, which account for 30-35% of the total sales.
“The challenge which consumer durable brands may have to deal with both un-interrupted continued supply and well as generating the desired demand.“
For potential customers, health and safety will become a priority. Customers will tend to spend more on this area with reduced discretionary spending.
People will spend on cheaper goods than on expensive goods, or delay spending for a while.
Extreme acceleration in the digital economy. I.e. Home education, home entertainment, home fitness, etc. There have been overserved an increased demand in subscription of Netflix & Amazon Prime in India.
A pro-active step has been taken by the consumer electronics brands by extending their warranty on products; which were expiring in the duration of lockdown to connect well to the customers.
Brand Loyalty to go for a toss- People will be less loyal towards brands as other aspects will take over. Customers switching brands will become faster due to various other concerns like safety, discounts, etc.
Let’s hope that things fall in place soon with a continued livelihood.
THIS SHALL TOO PASS, NOT TODAY MAYBE TOMORROW.