Top Tips For MSMEs to survive and thrive after Covid-19

India had initially declared a nationwide 21-day lockdown to counter the spread of the CoVid-19 pandemic. To curtail it further, India brought Lockdown 2.0! Many people around the world are commending this as a great step against the spread of the virus. While this may be true, it is also true that the implementation of the lockdown has left much to be wanted, and one of the biggest victims has been the Indian economy. All businesses, from MSMEs to industry giants, are now at a loss as to how to survive the business downturn. Business owners must now take drastic steps, or they simply will not make it through this.

Many analysts are convinced that the overall global losses are in danger of surpassing the combined losses during WWI and WWII! The National Statistical Office (NSO) calculated that the current job-market was at its worst, and unemployment had peaked to the max in 45 years.Barclays has theorized that the lockdown could bring the country’s growth down to 2.5% from the earlier estimate of 4.5%.

Here’s a more detailed look at the situation, sector-wise, of India’s industrial health –

1. Manufacturing Sector – Most of India’s major manufacturing companies have entirely shut down their operations or significantly reduced them – including Tata Motors, Aditya Birla Group, Larsen and Toubro, UltraTech Cement, Thermax, Grasim Industries and Bharat Forge.

Manufacturers such as Dabur India, ITC and Hindustan Unilever have also closed all factories not directly related to essential products.

2. Essential Goods and Services – The essential service industry, including food, healthcare, power and communications, though least affected, have also recorded all-time lows due to the massive disruption in the supply chain.

3. Services Industry – The services industry is also among the worst victims of the lockdown, with the logistics sector taking the brunt. Even the e-commerce sector, expected to be the least affected, has been brought down to its knees by the lack of logistics and transport facilities. E-commerce giants like Amazon and Flipkart have all closed their operations barring only essential consumables. Industries like Travel and tourism, Hospitality and Restaurant etc are the worst hit and may take years to bounce back.

There is a global reaction of maintaining normalcy, as much as is possible, through the implementation of work-from-home options, automation and cloud -based technology to deal with the situation.

To figure out how to survive the corona aftermath, the most easily estimated steps that the Indian industries will probably follow once the lockdown has ended are –

1. Generalized Cost-reduction – most sectors of industry have already begun to experience the general tendency of cost-reduction during the lockdown. Global downsizing will increase and motivate Indian business-owners to lay off all employees that aren’t critically essential to the survival of their businesses.

2. Increases in automation – while dealing with a reduced staff, most companies are going try increasing the amount of automation in their business processes. All functions that can possibly be automated without high investment will be done so with great haste. Cloud ERP and other Cloud business Software like E-Procurement software (cloud procurement to pay software), Project Management Software, Inventory Management Software, cloud Compliance Management Software etc. will be in great demand. It will become essential for survival. Till the time there is a cure for Covid-19, business will never want to take risks again and will plan to move for cloud platforms.

3. Prioritize their products and clients – companies are going to have to focus on their strengths, and may remove products from the market, prioritizing their most demanded and profitable products and clientele with only the more revenue creating ones kept in the books. It is very critical to monitor your projects, clients and products profitability and remove non-profitable products/clients and projects at the earliest. Project Management software can help you seamlessly track the profitability of your customers and projects.

4. Reform business strategy – According to a recent set of recommendations by KPMG^[1], companies will have to assess their short term liquidity to meet operational payments, make necessary adjustments to their capital structures, defer non-essential capex and explore potential disposal of non-core assets to make balance sheets lean.

This is when the industry must find the key solutions towards their survival post the lockdown. Since downsizing will mostly become the easiest way to cut back on company expenditure, affordable automation of business processes must be ensured. Fortunately, the modern market is full of opportunities for small businesses to automate their process.

We at TYASuite have a product range that has been automating business process and helping companies reduce their costs while increasing their profitability for many years now, and we believe that we can be a big part of the solution that MSMEs will need to survive the post-lockdown crisis.With the TYASuite Plug and Play Business Software product, you can:

1. Streamline and automate your procurement function: Our Procurement to Pay Software is designed to automate your procurement process seamlessly. With guaranteed reduction in operation time and cost of your procurement function and accounting function by more than 80%. TYASuite E-Procurement software can be your savior in this difficult time.

2. Optimize your Finance function – Make your finance function efficient with our Plug and play finance automation tools, such as Automated Accounting Software, Automated FAR Software (Fixed Assets Register) , Expense and Time management software, and reporting tools. Once you automate your finance function, you can rest easy and let the software do the work while you supervise and analyze the data we provide. Our automated TDS and GST tools are the best in the industry to ensure that your managers can spend more time on non-routine analysis work.

3. GST Related Compliances - With our Multi-location-GST function, your finance team can automate all GST related filings with a click. If you are a multi-location company and still using traditional accounting software with single GST location, it is high time for you switch to our Multi-location GST Software and reduce your team hours significantly. With our Multi-location GST Software, your team can seamlessly raise multi-location Sales Invoices and file multi-state GST returns with a click, and enjoy many more time saving functionalities.

4. Customer and Project Profitability - Our Project Management Software will make it easy for you to manage your projects digitally, and help your employees fulfill their functions remotely. Set tasks, manage priorities, track project progress, meet deadlines and collaborate with the entire workforce in real-time from the comfort of your computer or smartphones. Further, the Project Management software will help you to monitor client profitability and project profitability with a click helping you to take timely decisions and plug your cash burn.

5. Inventory Management - Our Inventory management software will ensure streamlined inventory holding costs, helping you identify your slow-moving inventory and re-use or liquidate the slow-moving items quickly. Further, with real time inventory and sales report at your fingertips, you can reduce your overall inventory cost and improve your profitability.

6. Compliance Management - When the world is looking for cost savings and survival, it would be dangerous to lose money due to non-compliances. As a CFO or founder, our Compliance Management Software will make it easy for you to make sure that your company does not violate any of the applicable regulations and you can monitor and manage all compliances with a single click. It is a must have tool for working in a multi-location environment.

In the times to come, it is imperative to ensure that the MSMEs of India stay afloat, as they are the ones at the greatest risk of insolvency and imminent bankruptcy. While the government is making many promises to help them in as many ways as they can, the onus is on the companies themselves to adapt and transform in the required ways to handle the onslaught of post CoVid problems they have never prepared for. The only way to have a fighting chance is to turn to digital technology, and make sure that the companies, and the people who are in it, stay safe, healthy and protected.

To help MSMEs, TYASuite is helping companies to adopt these must have technologies for MSMEs at an affordable price. Avail a Special extended No-obligation Free Demo for all of our product ranges during this global economic crisis.

As an Indian Company, TYASuite is committed to help Indian MSMEs in surviving the CoVid Epidemic and consequent financial crisis.

[1] - https://home.kpmg/in/en/home/insights/2020/04/navigating-the-covid-19-crisis.html