The impact of COVID-19 on the businesses In Thailand.

Not long ago, I met two old friends at about the same time. The talk was inevitable about the impact of COVID-19 on the businesses they both do.

The first one is the hotel owner. There are hotels in many provinces. Which is a total tourist province Before, I must say that the business is doing very well. Of course, in the past, it was completely affected. But still enough to support the business, as most hotels are not too far from Bangkok.

During the heavy lockdown period or even during this time when most of the customers are packed only on holidays. What about the money I earn when supporting employees and paying for other operation costs?

My friend laughs and replied that it wasn’t enough, but I survived because I was able to borrow money from banks. At the moment, he borrows cash to keep it. And with low interest So the cost was too cheap.

My friend said This sum of money will be kept. In case if something happens, we will have cash to support the company. While waiting for tourists to return.

simply put, they are borrowing money to secure future risks. And the interest is the same as the insurance premium.
Because as we all know Cash is the lifeblood If it stops flowing when the only place dies.

SMEs are considered a very important economic engine, ILO data in high income OECD countries SMEs account for 61% of GDP.

In middle income countries, SMEs generate approximately 40% of their GDP.And this crisis, SMEs are hit the hardest, so without good planning The economic scars with SMEs are severe and long. This crisis is not like any other crisis. Because of the massive global lockdown, economic activity stagnates almost simultaneously for the rest of the world. 

The disruption of manufacturing activities, along with a severe drop in income and purchasing power, have escalated into a global economic crisis. This time, it is characterized by a twin supply-demand shocks

 (The International Monetary Fund: IMF) estimates the global economy in 2020 will contract at 3 percent, the lowest in the second quarter and the worst since the Great Depression in the 1930s.

This is the first time that both major economies and developing countries have gone into recession at the same time. The estimated damage to the global economy in 2020 and 2021 is estimated at more than US $ 9 trillion. Which is bigger than the economies of Japan and Germany combined.

While the World Trade Organization (WTO) estimates that world trade volume will disappear by a third compared to the previous year.

Even now there is some good news about vaccines. But scholars are concerned that If the situation is prolonged, it will cause serious liquidity in businesses and households. Until the problem of widespread debt default It may also be at risk of becoming a financial crisis, or a “Triple Economic Shock,” which has never happened in the history of the world. And no one would want that to happen

At the same time, the Thai economic situation is not very good. This is partly because we have had economic problems before the crisis. Although the COVID situation began to unfold in many countries. But the Thai stock market index has not yet recovered to pre-COVID levels. Opposite the situation in many countries, despite the fact that the COVID situation is more severe than Thailand. But the stock market recovered more rapidly. In particular, the stock market in the economy with high technological developments, including the US, China, Japan, Korea or Taiwan,

for Thailand, SMEs account for 43% of GDP and are the main source of employment for the country with more than 14 million workers in Thai SMEs. Most of the people are in the trade and service sectors. Which is the sector that has been directly affected

Therefore, the Thai business sector has to adapt greatly, especially SMEs. I need help from the state image as well. In the past, the government and The BOT will issue measures in accordance with the Financial Assistance Act for SMEs that have been affected by COVID-19, such as

6-month deferral of principal and interest payments to SMEs with credit limit not exceeding 100 million baht without being considered a default and without losing credit history. And soft loans for SMEs with a credit limit of up to 500 million baht, interest rate 2% per year for 2 years, totaling 500 billion baht, with the government to bear the interest for the first 6 months.

In addition, new or additional credit has been made through government-owned specialized financial institutions for SMEs debtors totaling Bt3.96 billion,

which in part has helped mitigate some of this crisis. Because these are “opportunities” to breathe in all business.

In addition to helping Over the past, we have also seen efforts to adapt businesses in Thailand in a variety of ways. Either large or small.

Such as restaurants such as ‘Penguin Eat Shabu’, shabu shops that can not be served in the sitting area. The new strategy has been adjusted with the delivery service with shabu pot, which generates income and helps to manage the fresh products that need to be stocked well. It also uses the same staff that used to serve food to switch to delivery instead, thus retaining most of the employees.

And not just a small business adaptation In fact, we have also seen an adjustment from big businesses.

One of the business people that I really like to hear about your vision is Mr. Anupong Asavaphokhin, CEO of AP THAILAND, whom I have always followed.

Having said that, AP Thailand, as a large real estate business, was equally affected. But with such a dramatic adjustment, AP made a surprising surprise to the market. With the surprisingly growing revenue and profit figure, because the last nine months figure has shown a profit margin of up to 3,280 million baht, which is higher than the full-year profit of 2019 or the total income of more than 35,180 million baht. Very much

If we look at the details, it will find that AP Thailand has adjusted its operating plans in the first quarter. Has switched to launch new products from condominiums to single houses and town homes totaling 39 projects worth 41,820 million baht and changed communication to be in line with this new product mix.

What we can learn from this is that the organization’s mindset is very important. Because in this critical condition We cannot stick to old ways of thinking. And hope that the crisis can get better So fast switching is very important. Because everything is limited Be it time or cash

Cultivate sales from condos to single houses and town homes. Not easy If people in the organization do not change This mindset can not happen,

There is also another subject that you Anupong told, I think is a very interesting subject of “communication”
In a time of crisis communication is very important. Employees must know the status of the company. So as not to panic and empower employees to know how they help the organization survive. What is the purpose of the organization? Is to communicate to drive employees to have a mindset to fight under the same goal.