Coronavirus has hit the Economy hard. Is your Business Impacted?

It’s no more breaking news that the world is battling an unseen enemy. People have been trying to survive and are keeping to their region’s guidelines. Many have been lost to the ravaging disease.

Naturally, the economy of countries and companies are also failing due to the halt in business operations and travel. Small and large scale businesses aren’t shielded from the effect of the virus. With all these newly introduced policies, it is expected to see some business failing.

Read – COVID-19 effect on Business

How certain industries are impacted by Coronavirus

COVID-19 can spread among humans pretty quickly. This has made some countries ban restaurants, spas, and gyms from operating. So, if your business falls under these categories, you are going to incur losses.

Some organizations have devised a way of surviving this period, though. Domino’s, for example, has implemented ‘Zero Contact Delivery’ for their foods. They know that people are skeptical of coming to their public outlets, so they’re going to their customers to fulfill their needs.

Additionally, with ‘Social Distancing’ rules in place, your business space needs to be widened to accommodate your customers, and this might be a challenge for some. All these are the things killing businesses in the COVID-19 era.

A few months ago, WHO said COVID-19 might be here to stay. Some countries have locked their land borders and even shut down airports. So, if you deliver goods outside the country, profits from that angle are also not feasible.

The ‘Force Majeure’ Clause

An important thing, as a business owner, that you must be aware of is the Force Majeure clause. Under this clause, if you’re bound under an obligation to perform a service or deliver some goods which you cannot do due to unforeseeable circumstances, the receiving party cannot sue you and you won’t be liable to pay damages. But, you can only benefit from this clause if it has been drafted in the service contract.

Generally, such a clause encompasses non-human acts (like natural disasters), wars or terrorist attacks, government directions, as well as pandemics.

Since WHO has classified Coronavirus as a global pandemic, if you have a force majeure clause drafted in your SLA, ideally, your business should be safe from consumer claims. However, this may also depend on your demonstration of the fact that Coronavirus has indeed impacted your ability to fulfill the terms mentioned in the SLA.

A good move, thus, would be to include this clause in all future contracts that you enter.

Read – Using Force Majeure to Protect Your Business

Final words

The time has come for everyone to accept that COVID-19, just like HIV, is here to stay. If you don’t want your business to die, then devise ways to make it immune to the virus. This could not only include coming up with new ways to work, and observing government safety guidelines, but also becoming aware of things like the Force Majeure clauses.