Many companies are facing setbacks due to various reasons. However, the pandemic has set a different precedent, leading to the biggest business blunders; they are trying to maintain the buoyancy. In general, it could be said that the business sector is the worst hit. Here is the list of companies and the plausible reason for their failure to operate.
Biggest business blunders of 2020
There are a lot of business companies that are failing this year. These include:
- Kraft Heinz
- Kodak Technology
- ByteDance/ Ticktock
This is not an exhaustive list, just a few to name. Apart from these, the hospitality sector has also hit rock bottom, and though the government has introduced the “eat out to help out” scheme, it failed to take into account the street food stalls.If we examine, then there could be myriad reasons for the business’s failure in 2020.
Failure to operate
Apart from the pandemic, there are other reasons too for these business blunders.
- If we talk about small businesses, only 78.5% of them survived during the first fiscal year. It was further stated that only a few of the entrepreneurs get to celebrate their 10th birthday.
- Most of the business owners under the age of 30 will be likely to fail in their business—the reason being the market is not supplying or catering to the customer’s changing demand.
- 29% of the businesses failed because they ran out of cash.
- 17% of the restaurant failed in its first year.
Pandemic and its effect on business in a nutshell
When the pandemic hit, it was revealed that around 47% of the company experienced a decrease in their turnover. Apart from this, it was further added that:
- 9% of the workforce is furloughed; many are forced to work from home. This has substantially affected the business operation at all levels.
- Mounting debts on businesses is another reason for their failure. Most companies are still repaying their debts during the pandemic, which has significantly affected their working.
- Several other companies are unable to grow because of their mounting debts.
These are just a few reasons to illustrate the reason for businesses’ failure. Mentioned below is the list of companies that are facing crises during testing times.
List of companies facing crises
Here are a few companies for your kind perusal facing a hard time surviving in the business area.
- Uber: Not a good year for Uber since they have hit the rock-bottom. It was stated that the company had lost a billion-dollar, adding to their previous losses. Additionally, Uber has also faced many setbacks from countries, including China, Hungary, etc.
- WeWork: Despite trying its best to survive during harsh conditions, it indeed failed to keep up with their operation.The company lost around $2 billion and had to furlough 20% of its workforce to prevent bankruptcy.
- TikTock: The pandemic indeed turned sour China’s relations with other countries. Though initiated in India, it further extended to China to ban Tiktok on privacy infringement grounds.
Can this be prevented?
Well, specific measures can be taken to prevent huge losses. It is certainly not possible to dodge the possibility of failure, but it can be controlled to a certain extent. Mentioned below are the steps you can incorporate to prevent your business from disasters.
- One way to mitigate your business losses is by chalking out the plan to go about with the business. This is imperative since the situation is not the same.
- You can try communicating with the staff and come to a particular conclusion. You can decide on the team that needs to be furloughed if it’s necessary.
- Try focusing more on the work-from-home plan. Many companies are going online and making use of the online portal.
- Make amends with the online portal system since the pandemic is here to stay for a long haul. It will be better to recruit someone well-versed in technical knowledge.
- Why are businesses facing crises?
There could be a plethora of reasons if one goes on to inspect the answer. However, the ongoing pandemic has deteriorated the situation. This, in no way, means that the companies were doing well and good before the pandemic.
This means that the companies were under debt and were merely surviving. Business is a critical area, with high risks involved, so it is foreseeable.
- Will we see any better results post-pandemic?
Well, as of now, it is hard to say. Most countries will be busy recovering from their economic losses and certainly be paying a heavy toll for businesses’ loss. The stability of the UK’s employment and economy depends on small businesses, so let’s see how the dice rolls.
Indeed, these are trying times, but the crises are unavoidable. The business was always struggling to sustain, and the pandemic just deteriorated it to another level. It is essential to recover from this and reshape a new business model.