Struggling to survive the recent lockdowns ? Here's what small business owners can do

India's unorganized sector which contributes more than 50% to Indian GDP has been the worst affected sector due to the covid-19 and the lockdowns. The second wave in the country that has forced several state governments to enforce lockdown to curb the spread, is going to hit the unorganized sector hardest.

• What's the story? 

India, a country where most of its GDP is contributed by the unorganized sectors is facing the hardest second wave any Indian could ever imagine. As the shortage of oxygen and several life-saving drugs are causing a higher fatality ratio, several state governments are now forced to implement state-wise lockdown. 

Due to these recent lockdowns small businesses like barber/spa/salon, restaurant, hardware store, furniture shops, clothing stores, repairing center, etc are going to get most affected. Lack of liquidity, unavailability of funds to manage cashflows is the biggest challenge these people are facing.

These people were already struggling to fund their businesses most of them are already burdened with several loans at a much higher interest rate than their bigger counterparts. These businesses are always neglected by the banking sector due to their history of business and unavailability of proper financial statements. 

• What Now? 

The liquidity crisis is not going to go away for small businesses anytime soon so they need to figure out an alternative option. There is some small/microfinance bank which deal with these small businesses. Alternatively, they can reach out to friends and family to avail immediate liquidity at a lower cost. Now as most of the customers are at home and spending higher time online, it is very important to reach out to them using several platforms like Facebook, Instagram, Youtube, etc. All small business owners should realize that this is the best time to start selling their product/service online. Start identifying your customers and engage them with content related to your business.

• Whats Next?

As the daily numbers are slowly coming down in some states hopefully we can expect that small businesses will again start operating there. Though the small businesses are very less likely to get any benefit from government initiatives but still we can expect that govt. will come up with some initiatives to help/incentivise these businesses.