3 ms·
You can argue that the coronavirus is an unforeseeable event, and I would agree. However, in economic terms, this virus will likely translate to a 2-3 quarter d
by jsanford9292 7y ago
You can argue that the coronavirus is an unforeseeable event, and I would agree. However, in economic terms, this virus will likely translate to a 2-3 quarter demand shock (softening of demand). Any well-managed business should have a plan in place for weathering a 2-3 quarter demand shock.
- vikramkr 7y agoThere's a difference between adapting to different forms of demand and what you would do in a traditional recession versus your customers not being allowed to visit you because of government intervention. There's nothing for a restaurant to do here to respond to this particular kind of shock. Sure, you could sell through doordash etc, but setting that up and building a remote customer base was not a risk mitigation strategy 3 months ago - it was an expansion opportunity. And demand shock isn't the extent of it. How many companies could reasonably have been expected to anticipate that their employees will have to work from home? Remote work isn't an option for everyone (good luck remoting into a wetlab), and some companies have built cultures that thrive on people coming into work to meet employees face to face, find opportunities for teamwork and innovation etc. This is a fundamental set of behavior changes, not just a simple demand shock.