Business respond to ‘exceptional circumstances’
This evening’s main points for business as Ireland plots a course through the Covid-19 outbreak.
IN THIS TURBULENT time, Fora is going to bring you updates every morning and evening on the most relevant issues for Irish business dealing with the outbreak of Covid-19. Here are the main points this morning, March 19 at 17:30. We want to know how your business is dealing with the outbreak, drop us a line at email@example.com
As a limited number of TDs gather in Leinster House to pass emergency Covid-19 legislation, Irish business is trying to cope.
Daily passenger numbers on public transport illustrate the drop off in normal activity, as they have fallen to between 25% and 30% of the equivalent levels in 2019, according to preliminary figures compiled by NTA today. The authority confirmed that in the vast majority of cases, services provided by the Iarnród Éireann, Dublin Bus, Bus Éireann, Go-Ahead Ireland, Luas and Local Link continue to operate as normal throughout the country.
Over the past few days, the team at Fora has spoken to several businesses about how they are feeling the fallout of the outbreak.
Dubliner Kate McLaughlin, who is the founder of London-based We Got Pop, is doing her best to shift mentality in her business as it plots a path through the crisis.
“You’re not going to be customer-facing so how can you turn all the smart people you have in your business to value-driving activity?” she said. “If we use this time right, we can use this as a moment in our business’s history to create great value that we can come back to the industry with, once the production space is back up and running. “
Damien Crowe, who runs Red Torch Ginger on Andrew Street in Dublin and Main Street Maynooth, along with a takeaway service Kanoodle and manufacturing unit in Baldoyle, decided to close his restaurants and associated business on Tuesday to safeguard his employees.
Crowe intends to continue paying his 80 strong staff. ”My staff are excellent, I value them hugely and I want to do my very best for them throughout the crisis.”
“We started to get call after call as events began to be cancelled,” said Brendan Moloney of Dublin formalwear business Bond Brothers as he deals with the uncertainty.
Grocery delivery startup Buymie is managing a ‘huge increase’ in demand as people stay home. The company wants to help the government and retailers distribute groceries to vulnerable citizens.
Delivery could be key to keeping food businesses open and customers safe, as the arrival of Covid-19 brings about momentous changes in how every business works. Writing in Fora this morning, Conor McCarthy of Flipdish lays out some of the steps that food businesses might be able to take.
“Across all industries, we need to pull together and offer support to each other where we can. The maxim, ‘We are stronger together than we are alone’ rings especially true in times like these,” he wrote.
Lenders respond to ‘exceptional circumstances’
Since the Covid-19 outbreak reached a tumultuous phase over the last week and social distancing became the norm, businesses have been looking at ways of reducing physical contact. Several weeks ago, the World Health Organisation recommended using contactless payments to keep transactions a little more hygienic.
Some banks have been shelving fees to encourage the use of the payment method.
The chief executives of Ireland’s five retail banks – AIB, Bank of Ireland, KBC, Permanent TSB and Ulster Bank – and the Banking & Payments Federation Ireland BPFI met with the Minister for Finance Paschal Donohoe yesterday to set out a joint plan to support the thousands of businesses and employees.
In a statement following the meeting the five retail banks said they are introducing measures to help businesses and personal customers whose personal and business circumstances have been impacted by the Covid-19 crisis, and working collaboratively to ensure that continuity of service plans are in place, that critical functions can continue, and that staff remain available to continue to service customers at this time.
Peer-to-peer lending platform Linked Finance has also unveiled a range of financial supports that it is offering to existing borrowers and new SME customers during the coronavirus outbreak.
Earlier this week, the alternative lender applied a blanket two-month payment break to all its loans across the restaurant, bar, pub and hotel trades. The company said it is also aware that borrowers in many other industries are also currently affected and that it has been actively engaging with borrowers that have approached us to discuss their options.
In a statement today, Linked Finance said it is preparing to launch a new loan facility with a deferred repayment feature to help SMEs who require working capital due to the impact of coronavirus and get finance without starting repayments for 3 months.
Linked Finance is also engaging with the Government on how the P2P lending sector, and other alternative finance providers, can help SMEs access financial support.
As the government discussed emergency measures for renters at a Cabinet meeting earlier today, some of the country’s largest landlords and institutional property investors have said they will support residential tenants who are impacted by the disruption caused by the pandemic through measures such as deferral of rent payments and payment plans.
Landlords who are members of the Irish Institutional Property (IIP) organisation, which includes companies such as Cairn, Glenveigh, I-Res Reit and Hibernia Reit, have also committed to temporarily suspending the issuing of notices to leave to impacted tenants going through short term financial stress as a result of the pandemic.
Governments and central banks are injecting significant sums into markets and applying emergency policy remedies as they try to salve the impact of the coronavirus pandemic on the global economy.
The pandemic has seen markets crash as world growth faces its biggest crisis since 2008 and so far investors have largely shrugged off the stimulus efforts.
However, stocks in Europe and the US stabilised Thursday following a new initiative from the European Central Bank (ECB), which has faced criticism for not acting more aggressively so far, and another intervention by the Bank of England.
Europe’s stock markets opened mixed before gaining ground during the afternoon:
- In initial deals, Dublin’s ISEQ was relatively flat but closed up by 1.5%
- Europe’s Stoxx 600 closed 2.9% higher
- London’s benchmark FTSE 100 was up by 1.4%
- Frankfurt’s DAX was up by 2%
- In Paris, the CAC 40 rebounded to close up by 2.7%
- Wall Street was more than 1% higher in midday trading
Global giants scramble to adapt
Several industrial giants, in particular in the automobile industry, have reduced or even suspended production. America’s “Big Three” carmakers — General Motors, Fiat Chrysler and Ford — will temporarily halt operations throughout North America through the end of the month, the companies said in conjunction with the auto workers union.
Nissan suspended production at its Sunderland plant in northern England, the automaker’s biggest plant in Europe, and has also closed plants in Spain and Indonesia. French giant Peugeot-Citroen is shutting down all production sites in Europe, and Italian-US carmaker Fiat Chrysler, with which it is in the process of merging, also intends to close most of its facilities on the continent, as does Ford.
Germany’s VW is shuttering most European plants for two to three weeks and BMW said Wednesday it is shutting down production in its European and South African plants for one month. Renault is halting production at plants in France, Spain and Slovenia, as well as Romania, Portugal and Morocco.
A slew of retailers have shut some or all of their outlets, including Nike, Macy’s and Gap.
Penneys is to close its Irish stores in response to the coronavirus crisis until further notice, alongside Brown Thomas and Arnotts. Ikea is also following suit, with plans to temporarily close its Irish shops from Friday evening.
The iconic Saks Fifth Avenue flagship store in New York is closed, and Apple has shuttered all its stores outside China.
The situation is especially catastrophic for the travel industry, as airlines have been hit by a double-whammy: plunging demand and sweeping travel restrictions imposed by governments.
Low-cost airline Ryanair, which has announced “most if not all” of its flights from March 24 will be cancelled.
Russia’s Aeroflot has asked employees who have accumulated extra time off to use it, while Air France says it will look at reducing working hours, which several countries have facilitated with easier access to state benefits for workers now forced to go part-time.
Air France-KLM, which is being forced to slash as many as 90% of flights, will reduce its planned investments for 2020 by €350 million and make €200 million in savings elsewhere as it seeks to ensure it has enough cash on hand.
Something you might have missed
As social distancing hits the property market, we took a look as Irish property agents are turning to virtual viewings.
With reporting from AFP
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Note: This piece will be updated with additional information during the day.