5 sectors raking in the money despite Covid-19

6 months ago

By Kathirgugan Kathirasen

I’m sure you’ve seen a picture of the hydra – a gigantic, many-headed snake-like monster from Greek mythology that’s been fodder for popular movies such as Hercules and Percy Jackson. It has a defining strength – when one of its heads is cut off, two immediately sprout in its place. It exhibits a quality called antifragility.

I first heard of the term antifragile a few years ago when I picked up the brilliant Nassim Nicholas Taleb’s treat of a book “Antifragile: Things That Gain From Disorder”. In it, he coins and uses the term antifragile for things that gain from disorder.

He realised there was no antonym for fragility. Robustness doesn’t quite cut it as it is merely the ability to withstand disruption or shock, so he came up with antifragility – the ability to actually become better because of a disruption.

Covid-19 has torn the world open, exposing vulnerabilities we never knew we had. In this world of hurt where companies are going out of business left, right and centre, a few are exhibiting antifragility.

The global disruption is making these companies stronger. And thanks to it, they’re making big bucks.

Food delivery

The most obvious are food delivery platforms such as Grabfood, Foodpanda and Dahmakan. When I go out to grab lunch, the roads are understandably sparsely populated – except for food delivery riders who zip past once every few minutes.

In Singapore, Grabfood and Foodpanda have seen a 20% and 15% spike in sales respectively since Covid-19 took hold. I’m sure we’ll be seeing even higher numbers in Malaysia compared with Singapore as they have not instituted a partial lockdown as we have.

Some of those who previously only looked at food delivery as a supplemental mode of income have embraced it wholeheartedly in these trying times. For instance, Malaysia’s Ocean Flair Group which owns establishments such as Vin’s, Velvet Lounge and four others all now offer delivery, when only two did previously.

Home-grown uber-popular myBurgerLab is currently seeing 95% of its sales coming from delivery and thanks to its cult-like hold on Malaysian tummies, it’s enjoying a 120% surge in delivery sales.

Some individuals see it as an opportunity in disguise. For instance, K Vigneswari of Penang and her partner noticed that many restaurants were not doing well but that there was still a need for food delivery, and this spurred them to restart their food catering operations in Bukit Mertajam and Bukit Minyak.

Online shopping

Online shopping platforms are seeing plenty of wind in their sails as well, with Lazada Malaysia recently reporting an increase in orders right before and throughout the duration of the movement control order (MCO).

This worldwide surge in online shopping has even propelled American giants Amazon and Walmart into hiring a whopping 100,000 and 150,000 people respectively to help meet demand.

I’m sure everyone will agree that hypermarkets and grocery chains are the biggest winners of all – the Giants, Tescos and Jaya Grocers of the world. When I was in Giant Puchong on the eve of the lockdown, the crowd was festival-like, with people clearing shelf after shelf of essentials. So much for social distancing, I thought.

Those who are averse to large crowds have opted to place orders via delivery platforms and third party delivery providers such as HappyFresh and Lalamove. But many of them are struggling to meet skyrocketing demand, with Jaya Grocer even suspending its delivery service for the time being.

According to a study by the Malaysian Digital Association, “the online stores of supermarket chain Jaya Grocer and grocery delivery service HappyFresh saw the biggest jumps in sequential traffic in the third week of March, with activity up by 600%, compared with the first two weeks of the month”.

It added: “Traffic to hypermarket chain Mydin grew more than 540% in sequential traffic, while that to Tesco rose by more than 450%.”

Work communication apps

Another sector that has been lifted by the Covid-19 tide involves work communication apps. Zoom is leading the pack when it comes to its subset of video-conferencing platforms, having been downloaded almost 27 million times in March, up from a modest 2.1 million times in January. That’s an almost 13 times increase within a span of two short months.

Popular video calling app Skype and relative newcomer Houseparty are no slouches either, recording a more than 100% increase in downloads each during the same time period.

Microsoft Teams, which was launched three years ago to challenge pioneer and the then market leader Slack, is also a winner. It went from 32 million daily users to 44 million daily users in the span of a short week – between March 11 and 18.

The increase in demand is perhaps most pronounced in Italy, where it saw a stunning 775% increase in the number of users.

Entertainment and news media

Covid-19 has been an absolute boon to media outlets of all sorts. Astro, which prior to this was taking plenty of heat from the likes of Netflix and UnifiTV, is having a fabulous time, seeing a viewership increase of 71% for news channels and a stunning 200% increase for its English movies and entertainment channels.

Overall, Malaysians are spending 30% more time watching Astro now than they did prior to Covid-19. This is a trend that’s reflected across the board as streaming giant Netflix recorded a 47% increase in subscribers between March 14 and 16 compared with the week before.

Disney+, a video streaming service recently launched by the media mammoth Disney, is another big winner, picking up three times as many subscribers as it did a week prior.

‘Virus protection’ products

If I were to say that 2020 is the year of the hand sanitiser and face mask, few would disagree. These and similar products have seen a stupendous uptick in sales thanks to Covid-19.

According to Channel News Asia, many Malaysian manufacturers are reporting a five-fold increase in orders for hand sanitisers. HanaMedic, a Bangi-based company, usually makes 400,000 bottles of hand sanitisers a year, but since the outbreak of Covid-19, it has made 395,000 bottles in a mere three weeks.

In the US, online sales of things like hand sanitisers, masks, gloves and anti-bacterial sprays skyrocketed by 817% in January and February compared with the same period last year. In addition, sales of medicine that fight ailments such as cough, flu and cold went up by 198% and pain killers by 152%.

On the whole, Covid-19 has flipped the world upside down, decimating entire industries and bringing our sense of normalcy to a screeching halt. But at least some industries are exhibiting the all-important quality of antifragility that’ll carry them, and by extension us, through tough times such as this.

source:https://www.freemalaysiatoday.com/


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