By Charmaine A. Tadalan, Reporter

THE fitful resumption of bricks-and-mortar business and the cost of installing new safety measures have left companies no choice but to embrace the tricky double act of plunging headlong into contactless sales methods, while ensuring supply and transport disruptions don’t shut them down.

But beyond what they can do to help themselves, they are also counting on outside intervention — in the form of the stimulus packages currently awaiting passage in Congress. The return of something as mundane as buses on the road would also be nice.

Paul A. Santos, chairman of the Philippine Retailers Association and president of the Picture City chain of photography stores, said building confidence and minimizing face-to-face interactions are the main task for companies.

“In the short term, it is the industry’s mission to restore confidence in consumers and employees that shopping and working in-store is as safe as circumstances will allow,” Mr. Santos said in an e-mail.

“Going into the medium-term, it must accelerate the adoption of techniques that will fulfill shopper’s needs and wants, and yet minimize, if not eliminate, points of contact with humans in the purchasing cycle — the age of contactless commerce, of which e-commerce is just one of the methods.”

Mr. Santos said industry is complying with the health recommendations of the government and the medical community, including face masks, distancing and disinfection.

“At the same time, retailers are rapidly adopting contactless commerce techniques, and one of them, which is contactless payments, is by far the easiest to implement,” he said.

“E-commerce, however, is also sought after, because it creates an entirely new goods distribution channel and at the same time it has the potential for creating synergies with retailers’ bricks-and-mortar assets.”

During the lockdown, e-commerce allowed retailers to reach their customers via delivery and in-store pickup.

Mr. Santos said physical stores may soon implement a semi- or fully automated checkout system or even develop an artificial and virtual reality system for certain activities like clothes fitting or cosmetics sampling.

The digital transformation, however, must also allow for worst-case scenarios like a second-wave outbreak.

“To prepare for this eventuality, retailers must formulate continuity of business operations plans, which should include boosting online distribution efforts,” he said.

“Also, retailers must be ready to move essential back-office functions, like inventory, purchasing, financial management, and human relations to the cloud, to permit work-from-home operations.”

SUPPLY CHAINS
The British Chamber of Commerce of the Philippines (BCCP) said digitalization is considered central to any business recovery, and that extends to gaining some control over vulnerable supply chains, Executive Director Chris Nelson said in a phone interview.

The chamber has over 300 members, consisting of multinationals as well as small- and medium-sized businesses, which Mr. Nelson said the BCCP is more concerned about.

“I think the internet and digital will be critical to companies,” he said, with many members adopting work-from-home arrangements and leaving e-commerce to do the heavy lifting on sales. His caveat was the need for added vigilance on security of company systems.

In addition, Mr. Nelson also said companies will be focusing on improving supply chains and points of vulnerability.

“There will be a review of supply chains — how they can get things closer or shorter… and how can they then distribute to their business and partners,” he said, noting that speedy and reliable delivery will be a competitive advantage.

“This is a very unusual economic crisis… it’s a crisis where people couldn’t go out or are very restricted on how they can go out and therefore, for many people, home is where you can reach them.”

Francis del Val of Cobena Business Analytics and Strategy, Inc. said companies that can go digital are more likely to stay afloat.

“What’s going to be the key to be able to survive and thrive in this new normal is digital transformation,” Mr. Del Val said during the BusinessWorld Insights forum on June 10.

“Businesses that are digital are going to be more successful because they are going to be more productive, more efficient and profitable.”

WHERE GOVERNMENT SUPPORT COMES IN
Mr. Nelson said beyond what companies can do for themselves, the government’s actions will also be key in ensuring a smooth restart to the economy. He identified as most critical among the pending measures the P1.3-trillion stimulus package targeted mainly at micro-, small-, and medium-sized enterprises (MSMEs).

“The public and the private sector have to work together in order to avoid a deep recession and the impact on unemployment and economically challenged families,” he said.

“I think that will be as critical as the recovery strategies of the company.”

The measure he was referring to is House Bill No. 6815, the “Accelerated Recovery and Investments Stimulus for the Economy of the Philippines Act,” which will provide P50 billion in loans to MSMEs in 2020 and beyond.

“We understand constraints, but stimulus needs to be done now as quickly as possible in order to ensure that the economy has a V-shaped recovery.”

The bill was passed by the House of Representatives, but remains pending at the Senate.

PUBLIC TRANSPORT
Philippine Exporters Confederation, Inc. Vice Chairman George T. Barcelon concurred, saying: “I hope the money is channeled to MSMEs so that they can afford to get their people back to work and at the same time, start economic activity.”

Mr. Barcelon said exporters were hit hard by the lockdown and have not yet returned to their pre-pandemic levels of activity.

“The industry has been affected badly for eight weeks of whatever form of lockdown. Even now, we still don’t have public transportation and that is what has affected businesses,” he said.

Mr. Barcelon said the three major factors businesses need to recover — market demand, mobility of the workforce and supply chain efficiency.

The Inter-Agency Task Force running the government’s pandemic response allowed a phased-in resumption of public transportation, with trains, taxis, and shuttle services returning on June 1-21. During that same period, no provincial buses were allowed to enter Metro Manila.

Public utility buses, modern jeeps and UV Express units, meanwhile, were allowed to resume in the second phase starting June 22-30.

Mr. Barcelon added that companies are expected to work out with financial institutions how to extend loan deadlines and obtain credit to finance a return to operations.

“We’re in the planning stage right now and then also a lot of companies (are) short of financing and need to work out (funding) through their banks,” he said.

Mr. Barcelon’s recovery timeline for the economy is indefinite though he finds it unlikely to happen in the “next three months.

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