Staying the course in a challenging time

Local companies are leveraging government and private sector support to cope with the impact of the coronavirus outbreak.

Staying the course in a challenging time

When Jackie Ng signed the lease for his second NAYANA KPOP Cafe & Restaurant outlet in Potong Pasir in December 2019, he could not have known that the Covid-19 outbreak was poised to wreak havoc on the economy in a few months’ time.

The coronavirus  started to accelerate its spread globally in early February, and has showed no signs of slowing since. In response, countries around the world have implemented increasingly drastic measures to slow the virus’ spread, including travel bans, social distancing rules and even outright lockdowns of entire cities. 

In Singapore, unprecedented “circuit breaker” measures were put in place in early April requiring all but “essential” businesses to close. Singaporeans have also been told not to go out of their homes unless absolutely necessary.

Economy-wide impact
These moves have had a huge impact on businesses across a wide range of sectors; especially those in the aviation, tourism and F&B-related sectors. While F&B operators can remain open, they can only cater to delivery or take-out orders.

As a result of people staying home, sales at Nayana’s two outlets have plunged by 90%, while employee hours have been cut. In response, Jackie decided to join delivery platforms such as Grab, Food Panda and Deliveroo. He also revamped Nayana’s website to allow for online orders. 

“We decided to start our own delivery to avoid the commissions charged by the delivery platforms, but it is slow and we will require more amplification to reach customers,” he explained.

While F&B and retail were the first to be hit, the crisis has since spread to encompass almost all sectors in Singapore. One automotive company, for instance, has seen zero sales for the month of April.

“We are trying our very best to keep our employees without having to reduce their salaries and not encouraging them to go on unpaid leaves,” said the automotive company’s spokesperson.

Welcome government support
Struggling enterprises are eagerly awaiting government support that have been announced in recent months, such as a 75% wage subsidy for all employees, and rental rebates from landlords.

Yet, some companies believe that even the generous assistance may not be sufficient if the crisis drags on for a protracted period. 
DBS F&B digital relief package
Nayana has also taken advantage of DBS’s digital relief package, a suite of digital solutions to support the F&B services industry. Under the package, DBS is working with two homegrown technology startups, Oddle and FirstCom, to offer F&B businesses the ability to set up an online food ordering site as well as boost their online marketing activities, plus payment and banking ways.

Through the package, Nayana is working with FirstCom to amplify its digital market efforts. “The package is heavily subsidised so we only need to spend a small amount to help amplify our business for more sales opportunities,” said Jackie.

DBS estimates that there are about 8,000 establishments have been impacted by tightened safe distancing measures as a result of the Covid-19 situation.

“The DBS F&B digital relief package elevates our support for the F&B community by creating an ecosystem of government partners and homegrown technology startups to help affected businesses overcome cashflow challenges by creating new income streams fast,” said Joyce Tee, Group Head of SME Banking, DBS.  The F&B digital support package is just one of many steps DBS has taken to help support its SME partners.

With many SMES fighting for their survival, support from the government and entities like DBS is giving them a lifeline during this extremely challenging period. 

Yet, businesses will have to leverage the various schemes to innovate, seek new streams of revenue, or alternative channels to reach customers, while also building up their resiliency. This help put SMEs in a good position to capitalise on the upswing following the eventual end of the crisis.

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