Navigating the New Normal: Key Takeaways for Hong Kong SMEs Post-COVID-19

By Anthony Leung, Managing Director, FedEx Express, Hong Kong & Macau

The COVID-19 pandemic has disrupted the global economy. We are expecting a 5.2 percent contraction in global GDP in 2020 – the deepest global recession in decades, according to the latest World Bank report.

As businesses, especially small and medium-sized enterprises (SMEs), plan for recovery, many face unprecedented challenges, from unknown demand, supply chain uncertainties, changing customer expectations to safeguarding the health and safety of employees and customers. For Hong Kong, the recovery path will be shaped by SMEs – the backbone of the city’s economy, representing 98 percent of Hong Kong businesses and 45 percent of the workforce. The compact, flexible structure of SMEs gives them the edge over larger companies during times of unprecedented changes, enabling them to adapt quickly to emerging solutions and opportunities.

Hong Kong SMEs need to speed up digital transformation

Global consumer behavior has shifted – we have seen an unprecedented surge of online transactions during the pandemic. Recent research found that nearly half the respondents in Hong Kong said they spend more time online than ever before, on activities including browsing online shopping platforms, purchasing groceries online and visiting e-learning platforms.

As an international trading hub, Hong Kong is primed for such a shift. The city was ranked by the United Nations as the second-most prepared market for business-to-consumer (B2C) e-commerce in the region in 2019. Despite the uncertainties ahead, the stay-at-home economy continues to show signs of growth, opening the door to new possibilities for small businesses.

For one, accelerating digital transformation allows SMEs in Hong Kong to tap into online commerce and thus, global markets. This is a huge opportunity for them to turn around a pandemic situation in their favor and access overseas customers in a cost-effective manner. With this expanded breadth, firms will be able to execute a more diverse market strategy and mitigate risks.

Step up and listen to your employees’ needs

Sustaining a strong company culture and engaged workforce has never been more important during this unprecedented crisis. HR policies such as remote working, that address employees’ needs and well-being have become a top priority for business leaders to maintain employee engagement, satisfaction and work effectiveness. A recent survey in Hong Kong has found that 80% of respondents prefer work from home at least one day a week even after the pandemic, while 64% said remote working helps reduce stress at work.

Having agile leaders at the forefront who bring people together across different locations and conduct fluid decision-making while prioritizing safety and well-being of their staff can make all the difference in morale and productivity.

At FedEx, we put safety above all. In the early stages of the pandemic, we responded quickly by setting up a response committee to plan for all possible scenarios to ensure the health and safety of our employees and customers, from the provision of personal protective equipment (PPE) to our employees, especially our couriers at the frontline, to implementation of flexible work arrangements and contingency plans in case of a suspected or confirmed case.

Innovation is key for business resilience and transformation

Innovation has been the driving force for many corporations who are successfully adjusting to the pandemic’s impact on the global business landscape. For SMEs, the pandemic can be a catalyst in heightening their adaptability and resilience to future disruptions.

Businesses today are tackling changing customer demands. They need support from logistics providers who bring innovative solutions and products to add value, are sustainable, cost effective, adaptive, and address customers’ health and safety concerns. This is where digital tools, in addition to progress in robotics, drone deliveries and AI-incorporation into supply chains are becoming a key focus in logistics.

Innovation is in the DNA at FedEx and we are always interested in new technologies to better serve our customers. For instance, Roxo, the SameDay Bot, was designed to help retailers making same-day last-mile deliveries by using machine-learning algorithms and technologies to allow for safe and zero-emissions deliveries. Our latest innovation, SenseAware ID, a lightweight, sensor-based compact device which provides secure, real-time precision tracking for package movements within our network, is expected to play a critical role in COVID-19 vaccine distributions in the United States in the near future.

Practise corporate citizenship

Since the pandemic, businesses around the world have mobilized their resources to help communities where they live and work or support relief efforts to combat the coronavirus. Giving back to the community will be on the top of the agenda as we collectively work towards the post-pandemic new normal, enabling companies to grow stronger affinity with their employees, customers, partners and investors in the long-term.

From January through May this year, FedEx has transported over 9,500 humanitarian aid shipments globally through our collaboration with global organizations such as Direct Relief, The American Red Cross and Heart to Heart International. These shipments included more than 6.3 million masks, more than 1.5 million pieces of personal protective equipment, 41 medical shelters and 204 thousand boxes for food banks. In Hong Kong, we supported a local charitable campaign by helping to deliver hundreds of relief packages to underprivileged families for Agency for Volunteer Service.

With the pandemic reshaping how we live and work, the focus for the next normal will start with recovery and growth. SMEs continue to play a pivotal role in driving positive outcomes for Hong Kong by leveraging their intuitive, compact business models to respond quickly and flexibly to the evolving business landscape. Despite remaining uncertainties, the past few months have shown that resilience can be achieved when businesses cater to the needs of people, from employees to customers.