Surviving Pandemic - A Quick Guide

We all are going through an unprecedented situation which none of us has experienced at least in our lifetime. Our social interactions, our physical contact that we took for granted have changed. All major crisis in past brought in its share of changes in our life covering both social & business alike & this crisis would also bring both intended & unintended changes in the way we will conduct business from here on:  

1. Digitalization: We took paying in cash for groceries for guaranteed which has suddenly shifted to the digital medium. This is the tip of the paradigm shift unfolding in front of us across every aspect of our life. Coming to logistics all this while we kept digitalization like many other businesses at peripheral level. The last man in the chain always preferred a manual way to work which is going to change in a fast-forward manner.  Whether it is contacting / talking to people or managing data or issuing of shipping documents all would see a change. This presents real & immediate opportunities to drive efficiencies through digital.   

2.  Managing cash flow: The ongoing situation created because of lock down has made people realize that by giving higher / longer credit , investing too much in their parent organization or blocking reasonable cash in having fixed cost has brought them to existential threat.  Living on the edge is no more a sensible option.  A lesson drawn is to be financially prudent by having:

• Move towards a variable cost model.  
• Re-evaluate credit exposure

3.  Move towards variable cost: As shared in the previous paragraph, it is important for all organizations to reduce overall business cost.  The best way of cutting down on the cost is to convert fixed into variable cost wherever possible thus freeing cash to be used in revenue generation. 

4.  Building Agility: The ongoing pandemic has started forcing logistics companies to walk in uncharted territories in providing varied logistical solutions to their customers even if it means by sourcing from different quarters. Besides as we expect a drop in business it has become important for companies especially smaller ones to increase the range of products thus:

• Brick walling existing customers 
• Grow if not vertically but horizontally 

5.  Changing world: It is certain that with supply chain disruptions, increased governments protectionism & risk aversion would result in localised sourcing specially for essentials & strategically important materials.  Secondly & most importantly most of the global companies are looking at diversifying their sourcing which largely is from China.  This means a portion of production could potentially shift into India thus making us an export-oriented economy. This means logistics also would be required to go through a complete transformation to get us ready for newer/changed world