CoronaVirus Lockdown: A Risk For Online Commerce?

As of writing (March 27, 2020) in the world, with the total cases coronavirus being reported hitting 465,915 people infected, and it’s spread out 200 countries. The virus has already caused over 21,031 deaths across the world. Social separation is only the way to fight. A large number of offices and schools and colleges are closed, as are theatres, malls, and any other places where people could gather.

The fear of pandemic also leads to uncertainty in the global economy. In the light of this COVID-19, how can e-commerce businesses survive?

The two significant areas of risk for you as an online retailer seem to be: 

• The fear of made in China items 

Look at the situation; if your supply provider is not yet suffering from the coronavirus while in China, there is a risk that customers will be very suspicious about your products. Yet there is no report that a buyer has been infected with the COVID-19 by a “Made in China” products, but the fear is still there in people. So, when it comes to importing the items, you should accept the fact that your consumer will take extra caution over the next few months. However, it does not change the resultant loss of deals.

• The production chain is undetermined

All organisations, little or enormous, will confront the effect of industrial facilities being closed in China. Specifically, small-scale companies should be prepared for the impact of COVID-19. While large companies would have money reserves to rapidly search for newer supplies and sources of supply, a medium-sized company, on the other hand, is powerless because a Chinese zipper factory no longer works.

Specific risk on dropshipping

The risk of being affected by delivery issues and missing orders is a lot higher if your business is based on dropshipping. As a dropshipper, you don’t have a warehouse that you can fall back on. If your producer fails in China, which is very likely, the sale of your goods quickly comes to a standstill. Furthermore, without coordination, it is not possible for you to quickly hamster goods before the crisis affects you.

You depend on any longer coordination chain than only your producers. It is not sufficient for the industries to continue working. The local freight forwarder may also have stopped working due to the lockdown. The same conditions also apply to the shipping companies. Of course, venders with their warehouse also face difficulties with this problem, but it affects you as a drop shipper more directly. If you already run a dropshipping business, you should take some specific care of our tips in the next section. The same applies if you are thinking about getting into this business.

The risk is real but manageable

At last, Dr. Wenliang first cautioned of the risk of COVID-19, the coronavirus has bloomed into a worldwide emergency. On global markets and product management systems are also affected.

However, given the scale of the risk to the overall economy, it is crucial to concentrate on what has recognised good traders for generations: adaptability, ingenuity, and negotiation abilities.

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