kpmg COVID-19...resilient in these turbulent times. With the path of the disease uncertain and the...
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COVID-19 Navigating through disruption with resilience and informed vision The rapid spread of the coronavirus presents an alarming health emergency facing the world. As nations prepare a response to what WHO has pronounced a pandemic, our immediate concern as business leaders is the well-being of our employees and our ability to provide business continuity to clients and customers. This is proving to be the biggest challenge for consumer and retail executives since the financial crisis in 2008. Preparing a structured and coordinated response based on the impact to the economy will position your business to be resilient in these turbulent times. With the path of the disease uncertain and the consequences on economic activity difficult to quantify, KPMG has outlined areas that have been impacted by COVID-19: Demand shocks: Aversion behavior and social distancing has already lowered consumer consumption and spending levels, which will translate into negative GDP impact. Non- food retail will be disproportionately impacted. Supply shocks: Border closings and travel bans that include cargo are causing significant disruptions to supply chains. Monetary intervention: The Federal Reserve reduced interest rates, injected $1.5 trillion into short-term lending and is prepared to use other tools as necessary. Other nations like the UK are following suit. Fiscal interventions: Globally nations are preparing stimulus packages. Consumer staple companies may see shorter and less impact as a result of demand side stimulus packages. 1 See our complete COVID economic impact study here © 2020 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Highlights from COVID-19 impact study 1 Structured organizational response elements Protect your team ■ Focus on health and safety actions ■ Provide frequent communications ■ Support precautionary behavior Assign leader and stand up control tower ■ Create “nerve center” to serve as central point of contact ■ Assign clear responsibilities and streamline decision making Stay close to customers and consumers ■ Understand primary concerns ■ Proactively communicate with customers as events unfold ■ Develop actions to address needs Stabilize your supply chain ■ Determine exposures and risks ■ Prepare responses (inventory levels, alternate suppliers, etc.) Assess impact, scenarios, and develop plans ■ Conduct impact assessment and quantify demand and supply shocks on the business ■ Build varying financial scenarios based on severity and duration ■ Model actions across demand generation, working capital and cost control kpmg
Transcript of kpmg COVID-19...resilient in these turbulent times. With the path of the disease uncertain and the...
COVID-19 Navigating through disruption with resilience and informed vision
The rapid spread of the coronavirus presents an alarming health emergency facing the world. As nations prepare a response to what WHO has pronounced a pandemic, our immediate concern as business leaders is the well-being of our employees and our ability to provide business continuity to clients and customers. This is proving to be the biggest challenge for consumer and retail executives since the financial crisis in 2008. Preparing a structured and coordinated response based on the impact to the economy will position your business to be resilient in these turbulent times.
With the path of the disease uncertain and the consequences on economic activity difficult to quantify, KPMG has outlined areas that have been impacted by COVID-19:
Demand shocks: Aversion behavior and social distancing has already lowered consumer consumption and spending levels, which will translate into negative GDP impact. Non-food retail will be disproportionately impacted.
Supply shocks: Border closings and travel bans that include cargo are causing significant disruptions to supply chains.
Monetary intervention: The Federal Reserve reduced interest rates, injected $1.5 trillion into short-term lending and is prepared to use other tools as necessary. Other nations like the UK are following suit.
Fiscal interventions: Globally nations are preparing stimulus packages. Consumer staple companies may see shorter and less impact as a result of demand side stimulus packages.
1See our complete COVID economic impact study here
© 2020 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
Highlights from COVID-19 impact study1 Structured organizational response elements
Protect your team
■ Focus on health and safety actions
■ Provide frequent communications
■ Support precautionary behavior
Assign leader and stand up control tower
■ Create “nerve center” to serve as central point of contact
■ Assign clear responsibilities and streamline decision making
Stay close to customers and consumers
■ Understand primary concerns ■ Proactively communicate with
customers as events unfold ■ Develop actions to address
needs
Stabilize your supply chain
■ Determine exposures and risks ■ Prepare responses (inventory
levels, alternate suppliers, etc.)
Assess impact, scenarios, and develop plans
■ Conduct impact assessment and quantify demand and supply shocks on the business
■ Build varying financial scenarios based on severity and duration
■ Model actions across demand generation, working capital and cost control
kpmg
Mark SchmelingNational Sector Leader,National Advisory Industry Leader, Consumer & [email protected]
Our framework to assess business impact and drive cost control Our Data & Analytics platform builds a granular view of businesses to weigh options in the near term while maximizing longer term prospects
The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act upon such information without appropriate professional advice after a thorough examination of the particular situation.
The KPMG name and logo are registered trademarks or trademarks of KPMG International.
© 2020 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. DASD-2020-1274-6B
Some or all of the services described herein may not be permissible for KPMG audit clients and their affiliates or related entities.
kpmg.com/socialmedia
Scott RankinPrincipal,Strategy Practice Leader,Consumer & [email protected]
If you would like more information on COVID-19 or on how KPMG can assist your organization, please contact:
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