Strategies for Facing the Economic Crisis

At the beginning of 2020, many of us did not even think about the impact of the Covid-19 pandemic like the current situation. Sales decreased by 70%, potential for not being able to maintain production due to reduced purchasing power, and difficulties in managing business cashflow which resulted in laying off some employees and closing businesses.

The current condition is not the first crisis for the industry, especially footwear. The 1998 economic crisis also taught many things, that it was IKM became the savior of the Indonesian economy at that time. The Covid-19 pandemic has attacked almost all economic, social, and even health pillars. However, the crisis that we are currently facing together will give birth to many opportunities if we can survive with the best strategy in adapting and being more proactive.

Collaborative strategy, currently, Indonesia is not facing this crisis alone. Collaborating will strengthen the resilience of our business. The decline in the rupiah's exchange rate against the US dollar, pressure in oil prices, falling stock values ​​, and uncertain economic conditions will certainly affect the national economy. Sharing the platform with others (business partners) is the best way when we can't do it alone. Sharing values ​​with others (business partners) is also the best choice when we have limitations.

The wait-and-see strategy is a moderate choice amid the uncertainty of the COVID-19 pandemic. Currently, 70% of footwear IKM sales are down. Dependence on imported materials also makes footwear worse. In 2020 it's time to turn your business key from the original expansion mode to survival mode. How can you survive? it's time to tighten your belt (cashflow), but there will be new opportunities when you wait and see. So we must be observant of opportunities and dare to try.

Paradox thinking strategy. New opportunities and opportunities will surely come, so when you see a chance, that's the right time to take the risk of doing new things. Dare to do things that are unusual/contrary to common thinking is the core of the paradox thinking strategy. Dare to try when others have not tried.

A proactive strategy, if others do cost reduction, then you can make innovations for your customers. It could be that the current declining purchasing power is because the market is holding back its money to buy. But it's not wrong if you try campaign opportunities for the innovations you make, so that when conditions are normal, you will be one step ahead of competitors. If others do business as usual, then your opportunity to do activities out of the box. If others reduce the promotion budget, then do promotions and positive campaigns to help each other deal with the covid pandemic. If others stop learning from many things, including the current crisis, you must continue learning from many things, people, and experiences.

Good Luck