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Africa’s Liquid Soap and Washing Preparation Market to Expand Robustly, Driven by Growing Demand Due to the COVID-19 Pandemic

soap

Africa’s Liquid Soap and Washing Preparation Market to Expand Robustly, Driven by Growing Demand Due to the COVID-19 Pandemic

IndexBox has just published a new report: ‘Africa – Organic Surface-Active Products For Washing The Skin – Market Analysis, Forecast, Size, Trends And Insights’. Here is a summary of the report’s key findings.

According to the IndexBox study, consumption of organic surface-active products and preparations for washing the skin has nearly doubled over the past decade, due to population growth and rising middle-class incomes. In addition, urbanization had a positive effect. In 2018, the revenue of the skin organic surface-active products market in Africa was estimated at $1.2B, an increase of 2.5% y-o-y. Experts expect that the demand for liquid soap and other detergents will increase significantly in the near future due to the coronavirus pandemic.

Consumption by Country in Africa

The countries with the highest volumes of skin organic surface-active products consumption in 2018 were Nigeria (148K tonnes), Egypt (104K tonnes) and South Africa (73K tonnes), with a combined 80% share of total consumption. Somalia, Mali, Sierra Leone and Algeria lagged somewhat behind, together accounting for a further 15%.

From 2007 to 2018, the most notable rate of growth in terms of skin organic surface-active products consumption, amongst the main consuming countries, was attained by Algeria, while consumption for the other leaders experienced more modest paces of growth.

Exports in Africa

In 2018, the exports of organic surface-active products for washing the skin in Africa totaled 7.7K tonnes, picking up by 13% against the previous year. Overall, skin organic surface-active products exports continue to indicate a strong expansion.

In value terms, skin organic surface-active products exports stood at $18M (IndexBox estimates) in 2018.

Exports by Country

South Africa ($14M) remains the largest skin organic surface-active products supplier in Africa, comprising 77% of total skin organic surface-active products exports. The second position in the ranking was occupied by Egypt ($1.8M), with a 9.9% share of total exports.

In South Africa, skin organic surface-active products exports increased at an average annual rate of +16.7% over the period from 2007-2018. In the other countries, the average annual rates were as follows: Egypt (+5.0% per year) and Nigeria (+82.4% per year).

Export Prices by Country

In 2018, the skin organic surface-active products export price in Africa amounted to $2,366 per tonne, leveling off at the previous year. Over the period under review, the skin organic surface-active products export price, however, continues to indicate a relatively flat trend pattern. The pace of growth appeared the most rapid in 2012 an increase of 19% y-o-y. The level of export price peaked at $3,395 per tonne in 2009; however, from 2010 to 2018, export prices failed to regain their momentum.

Prices varied noticeably by the country of origin; the country with the highest price was Egypt ($4,116 per tonne), while South Africa ($2,177 per tonne) was amongst the lowest.

From 2007 to 2018, the most notable rate of growth in terms of prices was attained by Egypt, while the other leaders experienced mixed trends in the export price figures.

Imports in Africa

In 2018, the skin organic surface-active products imports in Africa totaled 37K tonnes, picking up by 21% against the previous year. In general, skin organic surface-active products imports continue to indicate a buoyant increase.

In value terms, skin organic surface-active products imports amounted to $101M (IndexBox estimates) in 2018.

Imports by Country

Algeria ($24M), South Africa ($21M) and Morocco ($9.3M) appeared to be the countries with the highest levels of imports in 2018, with a combined 54% share of total imports. Botswana, Libya, Angola, Namibia, Tunisia, Egypt, Mauritius, Ghana and Zimbabwe lagged somewhat behind, together comprising a further 30%.

In terms of the main importing countries, Zimbabwe experienced the highest growth rate of the value of imports, over the period under review, while imports for the other leaders experienced more modest paces of growth.

Import Prices by Country

In 2018, the skin organic surface-active products import price in Africa amounted to $2,686 per tonne, approximately mirroring the previous year. There were significant differences in the average prices amongst the major importing countries. In 2018, the country with the highest price was Algeria ($3,545 per tonne), while Zimbabwe ($1,468 per tonne) was amongst the lowest.

Source: IndexBox AI Platform

testing

To Meet the Demand for COVID-19 Testing, Many Labs are Repurposing.

It’s National Laboratory Week, an annual celebration of medical laboratory professionals and pathologists who play a vital role in health care…especially now during the COVID-19 pandemic.

According to the Harvard Global Health Institute, the U.S. needs nearly four times the amount of COVID-19 tests made available to individuals and organizations in order to reopen the economy. Further, it is estimated that as many as one in three COVID-19 tests are inaccurate.

To meet the demand for COVID-19 testing, many labs are repurposing.

Here’s a lab in Richmond, Virginia that significantly revamped operations and is working round the clock to meet the nation’s need for coronavirus testing…

Genetworx Laboratories began performing COVID-19 testing on March 23. The Genetworx test is guaranteed to be 99 percent accurate with results provided within one to two business days

According to Genetworx CEO William Miller, “There are not enough American laboratories that have the capability to perform really accurate COVID-19 testing. Since our company has the expertise and the complex instruments, we wanted to do our part and help America beat this infectious disease crisis. So, we quickly repurposed a portion of our lab. We are still building up our capacity in order to meet the increasing need caused by the pandemic. This is consistent with being a mission-based company dedicated to saving lives, as we are part of the Recovery Centers of America health network.”

Genetworx is currently able to process thousands of tests per day and is significantly increasing capacity in the coming days and weeks. With its special instrumentation and clinical expertise, the Genetworx COVID-19 test can deliver results with a 99th percentile accuracy reducing the chance of false negatives for patients.

“Genetworx is uniquely qualified to perform this type of testing and deliver incredibly accurate, timely results because we regularly perform complex molecular diagnostic testing, outside of the pandemic. Not all companies have the technology and infrastructure to deliver an accurate result in a timely manner. We have special instrumentation and expertise to run a large volume of COVID-19 tests and produce results in one business day with over 99 percent specificity and sensitivity. This capability is not found in most tests or in most laboratories. Some tests without this level of sensitivity will not detect the presence of the virus.”

The company is currently performing COVID-19 testing for a number of government agencies including state emergency systems, departments of health, physicians’ groups, and other American businesses.

Genetworx Laboratory is listed on the FDA’s website of COVID-19 test providers. The company is CLIA-certified and a CAP-accredited laboratory. These distinctions are the gold standard in the industry.

“Our staff is working 24/7 to ramp up to meet the need that this pandemic requires. We will do everything we can to be a part of the solution to this crisis,” said Miller.

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To learn more or arrange an interview please contact Terri Malenfant at tmalenfant@recoverycoa.com.

reits

Impact of the Coronavirus Crisis in the American REITs

Victor Kuznetsov, Managing Director of Imperial Fund, examines how US real estate investment trusts are weathering the COVID-19 storm.

Real estate investment trusts (REITs) have always been, historically, a classic of dividend investment through the Buy & Hold formula, which has allowed both retail, institutional and investment fund investors to have periodic cash flows, which complement their pensions in some cases, and that they increase their profit accounts in others.

In general, the REITs were distributing a dividend that usually ranges from the most “modest” of Realty Income (O) of 1.5-2% per year to that of other mortgage REITs such as Annaly or Agnc, whose dividends they reach 8-9% per year.

Nevertheless, the health crisis is practically causing an economic emergency, in which almost all the REITs are seeing their prices decrease, anticipating the fall of the real estate market and the entry into the technical recession.

At Imperial Fund one of the fundamental aspects in this investment sector, which seeks to achieve attractive risk-adjusted returns by exploiting inefficiencies in the residential and commercial real estate lending market, is diversification, which makes it possible to reduce both the beta (risk) of our portfolio, without jeopardizing the return on investment.

General and Sectoral Real Estate REITs

In these historical moments in which the coronavirus crisis is hitting strongly all investment portfolios, including those of institutional investors even though they use hedging instruments, the losses due to the drop in the price of the listing are being high, in view of the prospect of  business downturn and recession across the United States.

Observing the different sectoral types of REITs, and among the most penalized, and which have more possibilities to continue distributing a dividend without decreasing it and recovering in presumably a shorter period, we can distinguish:

Realty Income (O): It is the classic of investment in the field of REITs, it is considered an aristocrat of the dividend, and it distributes a monthly dividend, which in turn allows increasing the utility of compound interest. Its price has decreased from $84.92 to approximately $54, although we should not forget that in the 2008 crisis, its price dropped to $17.

Annaly Capital Management (NLY): It is the mortgage with the largest capitalization in the United States. Its price per share has decreased from $10.50 to $6.70. It is clearly being harmed by the global alarm situation, but that it is another diversified company that allows to systematically cover the risk.

Omega Healthcare Investors (OHI): It is another of the classic and most important REITs in the residential sector for the elderly. Its price has fallen from $45.22 to $17.50. The only explanation from the point of view of the fundamental analysis is that the market is picking up the loss of potential clients in their residence, because it is one of the most punished REITs, although obviously and in the worst case the replacement rate, in both the United States and England is clearly guaranteed.

The current situation should not provoke investors to believe that we are not able to think about the future, a future that, as has happened with previous crises, will always bring something positive, and will reward investors who trust in those companies that have adequate diversification, distribute a sustainable dividend, and are able to adapt to any situation that may arise.

At the present time, we may have entered a general downward curve on the stock market, and the aforementioned share price of REITs will drop further still, but they should be on the investment radar as a possibility in the future not far away.

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Imperial Fund is a mortgage investment fund formed in 2014 and headquartered in Hollywood, FL. Imperial seeks to achieve attractive risk-adjusted returns by exploiting inefficiencies in the residential and commercial real estate lending market.

disruption

Navigating Through the Disruption – An Oceania Perspective

Logistics has always been the backbone that silently keeps the world moving but, in this time of uncertainty, its importance has been magnified. COVID-19 has caused disruption globally to all business, in one way or another, and navigating this unprecedented time has highlighted many challenges.

With the evolving landscape, forward planning has become essential to ensure business continuity plans are effective. The need for a recommencement plan for businesses who have temporarily closed and a diversified supply chain for those who operate as essential services is paramount to ensuring business survival for now and success in the future.

What we learned from New Zealand’s Lockdown

The level-4 lockdown of New Zealand has shed some light on the potential challenges that may arise should Australia follow suit.

The Port of Tauranga has announced it is prioritizing the unpacking of essential goods so that the cargo can be handled and transported first. Container loads are able to be delivered to customer’s sites, if the site is accepting deliveries, however, they cannot be unpacked until the level-4 lockdown period has finished. By doing this, the Port and Government are ensuring the movement of essential goods remains efficient and that essential services can continue operations as usual.

Where a customer site is closed, we see the Port of Wellington waive storage fees for shipments that cannot be transported out of the Port.

We are working with our clients to identify if their goods would be considered essential in the event of a complete lockdown. We’d advise that all companies start considering what sort of goods they have incoming and work with their strategic partner to qualify if their goods would be restricted to such delays if a lockdown were in place in Australia.

Be realistic and confirm whether your goods are considered an essential service and put suitable business measures in place.

If you find that your business cannot be considered essential or it is not viable for you to remain open, you’ll need to prepare to get back to production quickly once the lockdown is lifted. We recommend that non-essential businesses put a plan in place for the commencement of reopening. It is important to consider whether the recommencement of operations would be staggered, what goods or orders are required to meet the operation recommencement timeline, and are these urgent.

Diversify your Supply Chain

Sometimes the best solution for a business’s supply chain issue is to consider diversifying your shipment options.

For example, it may be beneficial to combine different transport types by flying goods to Singapore before shipping them to Australia rather than just shipping from their location of origin. Combining the two transport types is a faster and cheaper option than purely using air freight in a volatile market.

Businesses may consider using Less than Container Loads (LCL) if they require certain goods for essential service production because it is more cost-effective than their standard full product shipment in a Full Container Load (FCL).

An alternative to air freight, road, and rail in Australia is the Domestic Coastal Shipping Service. After ships have unloaded goods in Eastern Australia, on their return journey to their location of origin, they are able to pick up and deliver domestic goods as they travel West along the coast. We have seen more than a 20% increase for the quarter year-on-year due to the additional pressure on the Australian road and rail market. Rail is at capacity with customers experiencing damage to goods, severe space, and equipment issues as a result whilst the state border closures are posing potential delays for trucking. Many major clients, especially in the food and beverage sector, are switching large volumes to our coastal service as a solution to ensure continuity of business supply.

This domestic shipping service provides a saving of up to 60% over rail and road services. Businesses would need to take into consideration the increased travel time required over other domestic modes of transport and plan this into their supply chain model.

When new challenges arise, it is best for businesses to discuss their options with their strategic partner, who will help navigate this uncertain time.

As businesses struggle to meet the demands of this new normal, C.H. Robinson’s trusted advisors around the globe are continually looking for the best solutions to keep your supply chain moving.

PPE

COVID-19 Trade Update: FEMA Implements Export Controls for PPE as CBP Issues Guidance Restrictions

On April 3, 2020, President Trump issued a Presidential Memorandum directing the Department of Homeland Security, through the Federal Emergency Management Agency (FEMA), to utilize the Defense Production Act to restrict the export of scarce domestic materials being used to respond to the spread of COVID-19, including certain personal protective equipment (PPE).

Effective Tuesday, April 7, FEMA implemented this Order through a Temporary Final Rule (the TFR) that restricts U.S. exports of five specific categories of PPE products that were previously designated by the Department of Health and Human Services (HHS) as “scarce or threatened materials.”

U.S. Customs and Border Protection (CBP) has since issued its own internal guidance on the TFR that provides further detail on the scope of the restrictions as well as key exclusions for certain U.S. exporters.

The TFR differs from traditional U.S. export control regulations, such as those administered by the U.S. Departments of Commerce and State, in that there is no licensing system in place and FEMA’s determination is not based on the proposed end-use or end-user of the product – rather, FEMA will assess all U.S. exports of designated PPE materials and reallocate those products domestically as required. Because FEMA is not an agency that traditionally administers U.S. export control regulations, it is critical for manufacturers, suppliers, and distributors of PPE products and related medical materials to be aware of the specific articles impacted by the TFR, the scope of the restrictions, the timeline for implementation, consequences for non-compliance, and the potential for expanded product coverage.

PPE Export Restrictions Overview

The TFR providing for PPE export restrictions is effective as of April 7, 2020 for a period of 120 days. The TFR designates five of fifteen categories of materials previously identified as “scarce or threatened materials” by HHS. In particular, the subject restricted PPE materials are the following:

-N-95 Filtering Facepiece Respirators, including devices that are disposable half-face-piece non-powered air-purifying particulate respirators intended for use to cover the nose and mouth of the wearer to help reduce wearer exposure to pathogenic biological airborne particulates;

-Other Filtering Facepiece Respirators (e.g., those designated as N99, N100, R95, R99, R100, or P95, P99, P100), including single-use, disposable half-mask respiratory protective devices that cover the user’s airway (nose and mouth) and offer protection from particulate materials at an N95 filtration efficiency level per 42 CFR 84.181;

-Elastomeric, air-purifying respirators and appropriate particulate filters/cartridges;

-PPE surgical masks, including masks that cover the user’s nose and mouth and provide a physical barrier to fluids and particulate materials; and

-PPE gloves or surgical gloves, including those defined at 21 CFR 880.6250 (exam gloves) and 878.4460 (surgical gloves) and such gloves intended for the same purposes.

Before any shipments of the above-listed PPE materials can be exported from the U.S., CBP will temporarily detain the shipment so that FEMA can determine whether to:

-Prohibit the export and return the shipment for domestic use;

-Utilize the Defense Product Act (DPA) to issue a “rated order” for the materials (a priority contract or order placed in support of a national defense program under the DPA); or

-Allow the export of part or all of the shipment.

In making its determination, FEMA may consider the following factors:

-The need to ensure that scarce or threatened items are appropriately allocated for domestic use;

-Minimization of disruption to the supply chain, both domestically and abroad;

-The circumstances surrounding the distribution of the materials and potential hoarding or price-gouging concerns;

-The quantity and quality of the materials;

-Humanitarian considerations; and

-International relations and diplomatic considerations.

Scope and Exemptions

On April 9, 2020, CBP issued an updated internal guidance memorandum (CBP Internal Guidance) to its field operators to clarify key definitions and general exceptions to the PPE export restrictions provided for in the TFR.

First, CBP highlights that the focus of the TFR is on “commercial quantities” of PPE exports, currently defined as shipments valued at $2,500 or more and containing more than 10,000 units.

The CBP Internal Guidance then lists the following export circumstances that are excluded from the FEMA restrictions:

-Exports to Canada or Mexico;

-Exports to U.S. government entities such as U.S. military bases overseas;

-Exports by U.S. Government agencies;

-Exports by U.S. charities;

-Exports by critical infrastructure industries for the protection of their workers;

-Exports by the 3M Company;

-Express or Mail Parcels that do not meet the “commercial quantity” definition above;

-In-transit shipments.

However, it is important to note that as of April 16, the Internal CBP Guidance on exclusions for the TFR has not been formally published in the Federal Register or elsewhere by CBP, and may be subject to additional revisions in its final form.

Practical Advice and Next Steps

All U.S. manufacturers, suppliers, and distributors of PPE materials or other products designated by HHS as “scarce or threatened” (the relevant HHS guidance can be found here) that are considering exporting their products for sale need to have a comprehensive understanding of the FEMA TFR and applicable export restrictions. Expect additional CBP and/or FEMA guidance in the near future with refined definitions, clarifications as to how the exclusions will be administered, and further details on how product definitions will be determined. It may be the case that additional products identified by HHS as “scarce or threatened” in connection with the fight against the spread of COVID-19 will be added to the list of restricted products for exports, including portable ventilators and certain drug treatment products that contain chloroquine phosphate or hydroxychloroquine HCl. Additional export, exporter, or product-based exclusions may be issued in the finalized published FEMA/CBP guidance as well.

In the meantime, U.S. exporters of PPE products can expect delays at CBP ports around the country as FEMA and CBP develop and implement the TFR and related policy guidance. If you have any questions about the TFR, the impact of the TFR on exports of PPE products, or whether a particular product or proposed export is covered by a CBP exclusion, please contact a member of Baker Donelson’s Global Business Team.

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Alan Enslen is a shareholder with Baker Donelson and leads the International Trade and National Security Practice and is a member of the Global Business Team. He can be reached at aenslen@bakerdonelson.com.

Julius Bodie is an associate with Baker Donelson who assists U.S. and foreign companies across multiple industries with international trade regulatory issues. He can be reached at jbodie@bakerdonelson.com.

workforces

Metros with the Most COVID-Impacted Workforces

The coronavirus pandemic has led to an unprecedented economic shutdown as thousands of “nonessential” businesses have closed their doors. The crisis disproportionately affects the 21.3% of American workers in retail, leisure, and hospitality who not only face lack of work, but also suffer from long-standing, below-average wages. According to the latest annual data from the Bureau of Labor Statistics, the average hourly wage for workers in the retail trade and leisure and hospitality sectors was just $19.70 and $16.55 in 2019, compared to $28 per hour across all workers.

Overall, the share of workers in retail, leisure, and hospitality increased steadily from 1970 to 2016 when it peaked at 21.8%. This trend was largely driven by an increasing share of employment in restaurants and bars, while employment in retail stagnated. Even though the last few years have seen a modest decline in the share of workers in these two sectors overall, more than one-fifth of all U.S. workers were employed in either retail trade or leisure and hospitality in 2019, totaling over 32 million workers.

The share of employment in these industries varies widely across cities and states based on local economic conditions and levels of tourism. Nevada and Hawaii lead the nation in the share of employment in retail, leisure, and hospitality at 35.5% and 30.1%, respectively. At the low end, Kansas and Minnesota both have about 19% of their workforce employed in these sectors.

To find the locations with the workforces most impacted by COVID-19, researchers at Volusion used data from the Bureau of Labor Statistics, the Bureau of Economic Analysis, and the U.S. Census Bureau. The researchers ranked metro areas according to the share of workers employed in the retail trade and leisure and hospitality industries. Researchers also looked at the total number of retail trade workers, the total number of leisure and hospitality workers, the cost of living, and the percent of residents below the poverty level.

To improve relevance, only metropolitan areas with at least 100,000 people were included in the analysis. Additionally, metro areas were grouped into cohorts based on population size. Small metros have 100,000 to 349,000 residents; midsize metros have 350,000 to 999,999 residents; and large metros have at least 1,000,000 residents.

Here are the large metropolitan areas with the greatest share of employment in retail, leisure, and hospitality, making their workforces the most impacted during the coronavirus pandemic:

For more information, a detailed methodology, and complete results, you can find the original report on Volusion’s website: https://www.volusion.com/blog/cities-with-the-most-impacted-workforces-during-coronavirus/

food sector

Food Sector Faces Multipronged Consequences of COVID-19 Outbreak

Brick and mortar, as well as online food chains, are facing the wrath of the current COVID-19 outbreak. The worldwide supply chain includes distribution, packaging, as well as sourcing of raw materials. Lockdowns are disrupting the transportation of packaged foods, prepared foods, non-alcoholic and alcoholic beverages. Before the pandemic, the major growth drivers were growing consumption of ready-to-eat convenience foods among on-the-go consumers.

Shifting lifestyle patterns, rising per capita income, and a growing population have been the prominent growth-enhancing factors associated with the food sector prior to the outbreak. However, shutdowns of restaurants and quick service facilities due to lockdowns have hindered the growth of the food & beverage industry to a large extent.

Online Food Orders Surge as Offline Food Chains Struggle to Cope with COVID-19

In view of the dual nature of the food industry, the impact of COVID-19 is multifaceted on online and offline food chains. The offline food chain comprises of cafes and restaurants that have been shut down across the globe. However, online food deliveries remain operational in most of the regions. The packaged food industry, in particular, is witnessing prolific demand for milk products and shelf-stable foods. As consumers hurry to fill their pantries, the demand is projected to surge even further. Almost every region of the world has been affected by the coronavirus crisis, namely, Asia Pacific, Europe, North America, and the rest of the world. An example of how supply chains were gravely affected is derived from Coca Cola Co.

The carbonated beverage giant, sources raw material from China where the outbreak surfaced in early December of 2019. During the initial days of the pandemic, the company faced a great deal of difficulty in managing the frontend of its supply chain. The production, supply, and export of raw materials from China were delayed due to which the company now solely relies on its suppliers in the US for sourcing sucralose. The major companies in the food & beverages industry affected by coronavirus outbreak include Subway Restaurants Inc., Starbucks Corp., PepsiCo Inc., Papa John’s International Inc., McDonald’s Corp., KFC Corp., International Dairy Queen Inc., Dunkin’ Donuts LLC, Domino’s Pizza, Inc., and Burger King Corp. For instance, Starbucks had to shut down about 2,000 outlets in mainland China after the pandemic began to spread like wildfire.

Livelihoods and Lives at Risk from COVID-19 Pandemic

The looming food crisis amid trade disruptions, quarantines, and border closures continues to endanger both livelihoods and lives worldwide. The huge imbalance between supply and demand resulted from economic shock in the midst of the widespread shutdown of businesses. The uncertainty surrounding the eventual retreat of the COVID-19 pandemic is adding to the crisis. Fast and effective measures are required to mitigate the effects of the pandemic on the vulnerable food supply chain.

Nutritious and diverse food sources are in short supply in the wake of the global health crisis. Furthermore, greater food insecurity is prevalent in regions hit hard by COVID-19 such as Spain, Italy, and the US. However, there is still the need for anyone to panic about the food crisis as the world has adequate stock of it. The only problem is making it accessible to every section of the society amid strict lockdown.

What Has the World Learned from History?

The 2007-2008 food crisis offered the world some important lessons which can be utilized to avoid letting a health crisis turn into an indispensable food crisis. Policymakers worldwide are intent on not repeating their mistakes of the past. As the measures tighten around the pandemic, it will be even more challenging to prevent the downfall of the global food system. Logistics bottlenecks are a major challenge facing the globe at present. The global food industry is certainly strained in terms of transport and accessibility.

So far food supply has been sufficient thereby disruptions have been minimal. However, the production of high-value commodities such as vegetables and fruits has declined. Hence, governments, especially in India, aim to restart the agriculture activities in parts during the harvest season.

What Does the Immediate Future Hold for Food Sector?

The food supply chain disruption is expected to continue through at least May 2020 as new cases of COVID-19 continue to rise. Movement restrictions will continue for at least two more months in various parts of world, which is why minimizing bottlenecks will remain crucial for major manufacturers in the food industry. Agricultural production, on the other hand, will be affected by a shortage of veterinary medicines, fertilizers, and other inputs. Moreover, demand for seafood products and fresh produce will continue to decline in view of less grocery shopping and closure of restaurants. In particular, aquaculture and agriculture sectors are among the most adversely affected by the pandemic. Canned seafood and other frozen food products will be on the other hand in demand. The suspension of school meals in emerging nations in India is another area facing the brunt of the COVID-19 outbreak.

One thing is certain: the poorest sections of the society including the migrant workers will be the worst affected by the pandemic. In India, migrant workers are terrified of dying from hunger even before the pandemic can strike. Feeding millions of poor families is a daunting task being faced by the government of India. Individuals continue to contribute their part to help the vulnerable ones. However, feeding them every day requires uninterrupted production and supply of essential food items. The food sector in developing nations will thus certainly face greater strain over the entire system in the foreseeable future.

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Nandini is a senior research consultant working with Future Market Insights (FMI), a global market research and consulting firm. She has been serving clients across Food & Beverages, Pharma, and Chemical domains. Currently leading FMI’s Food & Beverages division, Nandini handles research projects in various sub-sectors, viz. Food Ingredients, Food Innovation, and Beverages. The insights presented in this article are based on FMI’s research findings on Impact of COVID-19 on Food Sector Industry of Future Market Insights

supermarkets

From Physical Retail to Online Business: Marketing and Logistics Principles for Supermarkets

Supermarkets and retailers around the world began distributing goods via order channels over a decade ago, often as a future-oriented addition to a minor business segment, complementing standard services. As such, ordering online and receiving groceries via delivery is nothing new. Caught off-guard by the COVID-19 outbreak, however, supermarkets and food-retailers today are facing the challenge of switching their business model from physical retail to online order and delivery with unprecedented urgency. With physical distancing measures in place across entire countries, people increasingly prefer to avoid purchasing their groceries as walk-in customers to safeguard their health and well-being.

In this situation, the supermarket industry finds itself in a fundamentally altered market environment. The changes required from them are profound. Their typical infrastructure, such as buildings and storage centers, was strategically designed to walk customers through a supermarket, positioning products on shelves as per marketing and product placement logic, factors that become obsolete in an online retail world. What matters now is safe, reliable, and fast supply of customers’ online orders via dedicated distribution services. Logistics is at the core of addressing these challenges and the interface between marketing and logistics indeed becomes vital for fast implementation in the current scenario.

For a swift short-term switch, the prerequisites are two-fold: On the one hand, the supply of selected products needs to be covered either through local production or through available imports. On the other, a functioning online ordering front-end needs to be made available to customers. Yet, especially for supermarkets, it is the seamless and efficient operation of the “pick and packing” functionality that has now become the bottleneck.

This has several consequences that can be addressed: First, online supermarkets cannot provide the full portfolio of goods to their customers, at least for the time being. Sales analysis is required to meaningfully reduce the portfolio of products available online, and hence decrease the complexity of assembling orders later on. Amid the current circumstances, food and canned products will have higher importance than non-food items, and any of the latter to be upheld would need to be chosen sensibly. While customers may have less choice, portfolio reduction will help significantly in maintaining capacity for faster, more reliable physical delivery.

Second, shortened product portfolios can be divided into two categories: High runners and low runners. High runners are regularly purchased in high volumes, and their turnaround is quick. Low runners might be appealing in the physical retail world, but have less meaning in the current landscape. Third, high-running products within a simplified offering need to be stored differently for now. Usually, they would be placed decentralized along strategic points throughout the supermarket to attract attention. In a recalibrated setup, identified high runners need to be stored centrally in a dedicated area of the market where employees have unhindered access for fast “pick and packing”. Fourth, the commissioning time needed for workers to assemble an incoming order, needs to be kept as low as possible by minimizing physical distances required to walk.

Fifth, in packing the online orders received and getting them ready for dispatch, standardized package box sizes can be used to further reduce complexity. Just like in a game of “Tetris”, utilizing uniform cubic sizes will allow for packages to be stored in delivery vehicles in the most effective fashion. This is particularly relevant for food retailers that do not rely on third-party logistics providers for reasons of quality and food safety assurance.

Sixth, physical delivery of the commissioned orders should be prioritized and planned in a calculated way. Typical linear concepts such as “first order in, first delivery out,” will not be efficient under the current circumstances. Seventh, because of the reduced product portfolio, the products offered should not be static, but optimized on a regular basis. In other words, the now required short-term shift should not limit the industry to short-term thinking. Requiring customers to order in excess of minimum order amounts, imposing high delivery charges, expecting customers to accept long delivery times, accepting the jamming of orders, amongst others pitfalls – all of which we are currently witnessing internationally, can be avoided by emphasizing the outlined marketing and logistics principles.

While it is clear that supermarkets are at the heart of consumer goods supply during the current pandemic, it would not be reasonable to compare them with established online giants such as Amazon and others. Their business model and logistical setups are different, from the outset. This naturally calls for customers to exercise patience and good-will with their supermarkets for a while. Supermarkets are logistical hubs, run by people, for people, through people, even if for the time being, they may appear as an anonymous online screen only.

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Frank Himpel is a faculty member of the Engineering Management and Decision Sciences division at College of Science and Engineering at Hamad Bin Khalifa University in Qatar. Prior to moving to Qatar with his family in 2018, Frank served as a professor of business administration and logistics in Germany, where he also received his academic degrees. His research into aviation and air transportation management has taken him to several countries around the world.

 About Hamad Bin Khalifa University

Innovating Today, Shaping Tomorrow

Hamad Bin Khalifa University (HBKU), a member of Qatar Foundation for Education, Science, and Community Development (QF), was founded in 2010 as a research-intensive university that acts as a catalyst for transformative change in Qatar and the region while having global impact. Located in Education City, HBKU is committed to building and cultivating human capacity through an enriching academic experience, innovative ecosystem, and unique partnerships. HBKU delivers multidisciplinary undergraduate and graduate degrees through its colleges, and provides opportunities for research and scholarship through its institutes and centers. For more information about HBKU, visit www.hbku.edu.qa.

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Doing Business Under COVID-19: Going Online to Weather the Storm

Doing Business Under COVID-19: Going Online to Weather the Storm

At the time of this writing, there are now unprecedented restrictions being put in place to prevent the spread of the 2019 novel coronavirus or COVID-19, its official designation by the World Health Organization. These actions have been proposed as necessary steps in order to prevent the spread and transmission of the disease. However, its impact on the socio-political and economic fronts cannot be overlooked.

Such is the nature of this virus and the ensuing government actions that this will likely forever change how we do business not only in our individual nations but across the globe as a whole.

The technological revolution has already progressed sufficiently to allow for automation in a great many industries, but how can small and medium-sized businesses prepare before the next global pandemic?

Even in times of crisis, businesses still need to maintain communications with global partners, clients, and stakeholders. Get in touch with Tomedes’ crisis communication center

The Social Impact of COVID-19

Somewhere, some kid woke up in their dream utopian world, where they were forced to stay at home, playing video games in the basement, not having any physical contact with the outside world, or at least no more than necessary to order a pizza. Elsewhere, entire societies have been adversely impacted as restaurants, entertainment venues and other gatherings have been declared off-limits to the people.

Gatherings as seemingly innocuous as church meetings have been canceled, leaving many people suffering from the onset of cabin fever as they find themselves more and more isolated and incapable of participating in virtually any social engagement. This particularly impacts societies that value physical displays of affection between family members, friends, and acquaintances, along with the need to sustain relationships and friendships in a traditional hands-on manner.

The Economic Impact of COVID-19

Source: The Economist

Perhaps the most damaging disruption is that the COVID-19 is bringing the world economy to its knees, bankrupting many businesses for all sizes, and laying off employees by the droves, depriving them the ability to provide for themselves and for their families. With families still experiencing the shocks and crunches of the 2008 Financial Crisis and the Great Recession, along with the economic setbacks from the US-China trade war, the coronavirus pandemic couldn’t come at a worst time–not that it should have come at all. The pandemic is now having a rippling effect that expands throughout the global economic system as evidenced from the current global economic crisis.

Manufacturing of non-essential goods is now scaling back to even being suspended. Logistics and material supply chains are lagging behind which is then causing a domino effect, ultimately resulting in utter economic turmoil leaving entire sections of the economy beaten, battered and bruised with little hope for any immediate resolution.

Perhaps this outbreak will forever change the way that people work, shop and even how they live their lives. There are some industries that are currently thriving even during these economically depressed times. There are other businesses that are dying but some, with a little bit of effort and foresight, could be in a much better position during the next global outbreak.

Which Industries are Thriving During the Global COVID-19 Pandemic? And Why?

Source: World Health Organization

Despite the constant economic turmoil that is ongoing as a result of the current global pandemic, there are numerous industries that are thriving or at the very least, continuing operations. Many businesses that have already established themselves online in one form or another, are at the very least, not suffering as badly at present. Although, situations in some industries are mixed as some are forced to scale down their operations. Some are obligated to keep going considering the vital nature of their operations with profit being the least of their concerns as of the moment.

Tech Industry

As people continue their quarantine and lockdown lifestyle, they’ll naturally go online and browse all content they’ll come across to pass the time. Social media platforms are now experiencing a surge in content with people now having more time on their hands than usual. Streaming companies such as Netflix are also having a field day as ‘Netflix and chill’ routines are now the norm for more people for the next few weeks at least.

As for consumer electronic manufacturers, it’s fair to say that people’s consumer habits have changed from conspicuous spending to practical spending. There’s significantly less demand now for luxury products and consumer electronic products with the exception of consumer medical devices. It’s much more practical now to purchase a thermometer and digital blood pressure monitor than the latest iPhone or pre-ordering the upcoming PS5.

Ecommerce

The global ecommerce industry is facing mixed experiences as we speak. One can assume that as people stay indoors, ecommerce businesses are bound to have a field day. In reality, it entirely depends on your product inventory whether you sell essential goods, medical devices, or consumer electronics and so on. The impact on ecommerce businesses also depend on how much they rely on the global supply chain.

Since the pandemic has initially brought China’s manufacturers to a halt, everyone from ecommerce businesses to global retailers are taking a big hit. Some ecommerce businesses are forced to suspend their operations and even close up shop as they can’t restock their inventory. However, other ecommerce businesses are unable to cope with so much demand as people continue to stock up on essential goods.

Logistics

The global logistics industry is now the lifeblood holding the global economy together that’s currently hanging on by a thread. From supermarkets, relief operations, healthcare centers, to families, it’s imperative that logistics companies around the world keep running round the clock to deliver not only essential goods but also vital medical supplies of all kinds from testing kits, face masks (surgical, N95, etc.), to face shields, safety goggles, protective suits, and disinfectants.

However, there are some logistics companies that are on the losing end as many have been forced to scale down to even suspend their operations temporarily as the logistics workforce are highly susceptible to viral transmission.

Energy and Utilities

With families now staying, working, and continuing their schooling at home, energy and utility companies will naturally see a tremendous spike in operations. But whether this is profitable for their industry isn’t as black-and-white as one might think. Many energy and utility companies around the world are now extending bill payments to a month to cushion the financial toll families and businesses are currently experiencing. For energy and utility companies, perhaps profit isn’t their main concern now as they’re now working hard to keep their services uninterrupted and not putting lives at risk.

Medical Industry

The global medical industry is now in overdrive with some even classifying their operations as being elevated to ‘wartime’ level. However, we wouldn’t classify it as thriving per se in terms of opportunities and increased revenue. All health professionals and relevant frontliners are now overstretched around the world and facing dwindling medical supplies as cases rise.

It’s fair to say that the pandemic is putting even the most advanced healthcare systems under enormous pressure. The medical industry from healthcare providers, pharmaceutical companies, medical device manufacturers, and disinfectant manufacturers are now working round the clock to keep up with the pace of infections to keep it from spiraling out of the control.

Another part of the medical industry that’s seeing a spike in demand are unconventional medical services such as telemedicine and online mental health services. Doctors are highly vulnerable to viral transmission and must be protected at all costs. For patients with non-serious symptoms, telemedicine is the safest way to get a check-up from your doctor.

As for online mental health services, the abrupt social isolation along with some families even being mandated to isolate themselves from their own loved ones to prevent transmission within the household is having a damaging toll on people’s mental health.

The Language Industry

Business is booming for many aspects of the language industry, especially online translations. This is in large part due to the requirements of scientists, academics and medical professionals working around the world to stem the tide of the global COVID-19 pandemic. All of the research, the latest breakthroughs, and the research and analysis of these medical professionals must be quickly and accurately translated and then distributed to similar communities around the globe. Medical translation is also needed in the medical device industry as medical devices such as testing kits need to be accurately translated for it to be used properly by all countries affected by the pandemic.

Live interpreters are less in demand, though there are still exceptions, most notably in the medical, political, and public relations arena where communications must continue. Even here however, more and more of the work is being conducted via video conferencing and using other online means to prevent the need for gathering together unnecessarily. Translation agencies and even freelance translators and interpreters working online are experiencing an increased demand for their services when other industries falter.

The Freelance Industry

There were many claims made from both sides of the debate during the passage of AB5 in California, more commonly known as the “Gig Economy Bill”. Despite all of these claims however, freelancers online have experienced a record surge in terms of both the number of people looking for freelance work and the amount of work being moved to the “online economy”.

But not all freelancers can claim all is well unfortunately as the effects of the pandemic does naturally vary between industries. While many freelancers working online are enjoying a great boom in business, other freelancers providing on-site services such as consultants and even freelancers working for film and TV history, are having a rough time as we speak.

Setting Up Your Business Continuity Plan Amidst the Coronavirus Pandemic

Moving a business online is not only beneficial, but given the current economic and social crises, it may soon become inevitable, especially as the technological revolution automates industry and replaces more traditional jobs. There are additional benefits to the company as well.

The individuals working from home do not require expensive computers, desks or other equipment that the business owner would otherwise be forced to acquire. The business owner will not have to pay for all of the electrical consumption or other utilities that would otherwise be an added expense.

Even businesses that cannot be fully established online will benefit from an online presence. Localized service providers who only provide a limited service in an equally restrictive geographic location are one such example. Still, there are many aspects of the business that can be conducted online without any or at the very least, minimal disruption to the services being provided.

Moving Operations and Transactions Online

Accounts Payable and Receivable, IT services if there are any, and a host of other jobs can easily be completed through the use of professional agencies online, or by hiring employees who will be telecommuting, or working from their own homes. Some of the work may be outsourced to professional agencies and freelance workers online. But virtually all of it can be done without the need to congregate together in a closed, more restrictive environment.

Shift to Telecommuting

Companies that retain all or even a portion of their staff as telecommuters will be in a better position to weather the financial storm created by the current crises. This may perhaps be best demonstrated oddly enough, by looking at the internet and how it works. IT professionals are among the most common people in the industry working as telecommuters online. As long as there is internet, then there is work for people.

Likewise, programmers are able to work from home, as are customer service representatives and other key positions working in IT. Any company that can establish as much of its workforce as possible as telecommuters will enjoy numerous benefits that will be explained in the latter portion of this article.

Maintain a Skeletal Workforce for Operations if Possible.

As of writing, many businesses have had to make changes overnight from moving their operations online to even laying off a part of their workforce just to keep their business afloat. With the employees you have left, it’s important to also keep your business running by maintaining a skeletal workforce to focus on vital operations for the time being.

Using Voice Over Internet Protocol (VoIP) Services

Using VoIP services such as Skype and Facetime is a perfect way to continue face-to-face interactions not only with your employees but also clients. These are mostly free but do come with premium subscriptions if you want more access to its features as video group calls.

Expanding Your Ecommerce Capabilities

Some local businesses may already have an online presence, but may also need to consider expanding their services that are offered online. Any company that has a physical product that is going to be shipped out, or that offers online products, may want to consider the addition of an ecommerce or merchant page on their website.

This gives the business owner access to a much larger audience while at the same time, more fully automating much of the checkout process and reducing the number of employees required to perform the job functions.

Upgrade Your Content Marketing Strategies

Unlike printed ads or brochures, a website can also contain videos, which are a primary tool in every internet marketing campaign. This is especially true if the videos are used to introduce products to the customers, which is a very effective technique for increasing sales online.

Videos also have been shown to do better when they include closed captioning or video translations. Many people who are searching for products and services online will prefer the videos and watch them rather than read through large volumes of text.

The inclusion of video closed captioning through video translation services will allow for the customers to enjoy the full video experience without having to worry about missing anything, even when they have the sound turned off. Given the extent of the potential audience though, video translation and video marketing are excellent and necessary tools for an online marketing campaign as more people stay at home.

Relying on Customer Relationship Management (CRM) Platforms

You might have already been using CRM platforms but in these times, they couldn’t be more necessary now as your business continues operations online. CRM platforms make the process of monitoring clients and keeping track of relevant client data much easier. CRM platforms now run under cloud systems which means your employees can continue their services from the safety of their home.

Shift to Employee Management Strategies using Employee Tracking Tools

It’s fair to say that going online is a whole new realm, figuratively and literally. Business owners and managers need to be inundated with the latest online management strategies to keep track of their employees performance. One of the most vital essential tools in online employee management are employee tracking tools.

Employees can clock in and clock out per shift as they did before in which the tool will keep track of the total number of hours they’ve worked. Another useful feature in employee tracking tools is it takes screenshots of your employees’ screens. This helps managers know whether or not their employees are actually working on the tasks at hand rather than streaming Netflix.

Use Localization to Try to Get Ahead of the Curve

Let’s talk more about localization here and how you can get provided an elevated online customer experience for your foreign audiences and markets, especially during these trying times. Among the most popular online trends for business in 2020 is globalization through localization. Localization is all about speaking to the target demographic in their own language not just in a linguistic sense but also culturally and socially.

You’ll be using their preferences and norms as points of reference to help you refine your product and marketing strategies. This involves establishing a full business presence online in numerous different markets, using language and references that the people will understand from a more localized and personal perspective.

Localization indeed is more than just language, but translation itself under localization takes on a new form. Localizing translations involves taking note of regional linguistic nuances. Language differs greatly, even when everyone involved in the conversation speaks the same language. Think about the local vernacular, local phrases and local accents. Add in local frames of mind and points of reference, and even in different areas that speak the same language, different localization techniques will be required.

In many areas of the world, it will be necessary to use two or more local languages. The province of Quebec generally requires both French and English if it is to be effective. Locations around the Southern border of the USA may require both English and Spanish. Many locations throughout Europe commonly use numerous languages. Switzerland recognizes German, French and Italian as official languages, but also has a strong presence of Romansh. In such a case, four or more languages may be required to be translated for the website. In Switzerland, staying there for a moment in time, the areas for each language are generally geographically specific.

Each one of these geographic areas will have unique features and individual points of pride for the local populations. The ability to integrate these into a larger online campaign using localization strategies means that each one of these languages can be used to more specifically target the desired audience.

The best means to accomplish such a task is to ensure that when moving online, a translation agency that specializes in localization strategies is used in order to ensure both the accuracy and the individual aspects of a more complete, professional and personalized translation service. In some cases, these techniques will be crucial even for a more localized and restricted online business presence.

In other cases, they may be part of a broader globalization campaign, though using the same techniques of localization. However, there are places in the world that lack regular internet access. Some research may need to be done on who will be your ideal target audience.

Going Online Amidst Medical or even Economic Crises: Final Word

For those businesses that can go completely online, there will be no more need to worry about where people can or cannot gather, or what people can or cannot do in person. Many of these companies have the added benefit of creating  online products and services that can be delivered over the internet. Furthermore, the expansion of the online economy will keep the world economy going rather than flatlining.

The impact on ISPs and the relevant infrastructure have already pointed out the need for some expansion of the underlying infrastructure of the internet. It will create the need for more and better infrastructure to be built, resulting in even more work being made available online.

Overall, building a business online may seem like a rather small affair at first glance. However, just as is the case with the current social and economic crises the world is facing, the gains of an online business can create the very same rippling and domino effects in the opposite direction. The creation of more industry results in the creation of more jobs even in times of economic turmoil, and does more than just its “fair share” to aid in the global economic recovery.

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This article originally appeared on Tomedes.com. Republished with permission.

How to Be a Strong Leader during Coronavirus

The economic and social uncertainties that the coronavirus pandemic has precipitated all over the world have created new and harsh challenges for political, religious, community, and business leaders. No one saw the current pandemic coming, so not many leaders were sufficiently prepared for it. But then, a leader must lead regardless of how unprepared or inexperienced.

In the business world, leaders are struggling to cope with the new realities of social distancing and the increased need for remote working. This is a time when business leaders need to inspire hope among their employees, even as they struggle to keep their businesses afloat. It is a time when leaders need to take quick actions that will save supply chains from collapsing. Consumer trends are changing faster than ever experienced before, and businesses must keep up with the trends or risk running out of business. Indeed, difficult and important decisions must be made and made fast. But how can a leader inspire hope during these difficult times?

For a start, business leaders must work closely with all stakeholders- governments, clients, partners, investors, and employees- in monitoring the virus and prioritizing everyone’s safety. At the same time, they must try to cushion the financial future of their organizations and employees. Strong leadership skills have never been more relevant. Here are 5 strong leadership skills that will help you provide the leadership that your employees so desperately need:

 1. Have a compelling and consistent message

Communication in times of crisis is way more demanding than during any other time, particularly because your subordinates must believe in your message first before agreeing to abide by it. You need to inspire hope that the current crisis will come to an end soon, but then the people you are inspiring are convinced otherwise. People are desperate for “the normal” so that they can go back to pursuing their careers and lives, but then their optimism is gone. Their only hope is that their leaders can chart a path forward, but then most of them don’t trust anyone who has the right answers to this pandemic. You will have a better shot at inspiring your staff if your actions and body language are consistent with your words. This is the time to leverage the experiences, values, talents, and qualities that your juniors appreciate about you. Build your message around those qualities and be consistent while at it.

2. Be empathetic

You will need to make tough decisions during this crisis, but you must always come from a place of empathy. This is a time when your listening skills for managers will be put to test like never before; a time when you have to understand the feelings and experiences of your juniors before making any decisions. Such skills will help you detect fear and agony in the questions your juniors ask, so you are able to empathize with everyone and give the right directives. Note that it is natural for some of your juniors to feel like you don’t have answers or good enough solutions to their fears. If you are empathetic, however, you will understand their paranoia and skepticism better and that will enable you to package your solutions in a way that inspires hope in the midst of the paranoia, doubts, and hopelessness.

3. Be tenacious

Strive not to be overwhelmed by the challenges this pandemic has brought. Let everyone see your determination in defeating this disease and its ripple effects. Being tenacious includes thinking long-term and helping everyone around you to see the bigger picture, even when the present reality seems so bleak and unsettling. As much as you need to be reactive when handling problems as they come, you need to be responsive as well. That is how you will convert your employees and people around you to be believers and followers. Of course, the solution lies far into the future but it is only through your today’s tenacity that the future everyone wants will be achieved.

4. Be truthful

There is a lot of misinformation doing rounds on social media and that has led to confusion. Don’t fuel that trend. Be straightforward and honest in your messages, focusing more on how the virus can be defeated.

5. Ask for help when you need it

The people you work with have almost the same dreams and ambitions as you. They also have ideas that could help you navigate these murky waters of the COVID-19 era. That is why it is okay to go to them for ideas on how to move forward.

Conclusion

With a little more courage, emotional intelligence, and integrity, you will easily navigate the current coronavirus crisis. Remember to care for the people around you and to communicate effectively and with clarity. We shall overcome!