COVID-19 swept the world off its feet when the pandemic started last year. The trauma caused by the pandemic took a toll effect on our daily lives especially education, businesses, healthcare and so on. This article will look at the negative impact of COVID-19 on businesses in Ghana. One may ask how did COVID-19 affected businesses in Ghana, businesses were forced to reduce their number of workers just to maintain a reasonable cash flow, wages were cut down for remaining workers and working hours were reduced. let’s look at this.
First, the lockdown effect
The Government was forced to impose a partial lockdown in some areas such as the greater Accra and kumasi. Businesses in these areas were highly affected. Every business rely on customers but the lockdown restricted movements thus most business firms had no option but to close down and lay off workers.
With the fewer business firms that were still operating, orders reduced drastically. Most firms found themselves with fewer or no customers at all thus reducing revenue and cash flow.
This is where the manufacturing companies come in, manufacturing companies were affected in a way that the cost of raw materials increased which in a way became a major problem for most manufacturing companies. The reduction in cashflow made it difficult for them to acquire expensive raw materials for production.
Finance is the backbone of every business firm, the pandemic cornered many firms to lay off workers just to maintain a reasonable cashflow. Revenue and cashflow deteriorated due to low sales. Moreover, financial institutions had no option than to tighten their terms for financial assistance.
It is obvious Covid-19 has affected our daily lives and the economy as well, the economy needs these businesses to be in operation to generate revenue for the state. But to curb and contain the spread of the virus, the Government had to put certain measures into place that’s why most businesses had to close down. Businesses in the affected areas feared to recruit new employees which in a certain way increased the number of people at home unemployed. Although businesses were highly affected but with the use of modern technology, businesses are bouncing back to full time operation.