While not a popular consideration for business owners and leaders, price resetting has inevitably been activated by the present health crisis and social recession confronting the globe.
Sweeping fiscal reforms aimed firstly at stabilizing the massive social fallout we are currently witnessing and secondly, averting major economic fallout, will not be enough to address the seismic shift of unprecedented social dislocation, being experienced. This of necessity must be augmented by a global review of pricing across all sectors to further alleviate the “fear of survival” while creating an environment that stimulates opportunity for the fastest route to economic stabilization and growth.
Clearly, the global workforce has been significantly undermined and with it, the capacity to spend at pre COVID 19 levels on goods and services. This in effect is a clear early indicator that business recovery will hinge not only on the stimulus packages being rolled out by governments around the world, but as well on a wide ranging review of pricing for goods and services.
Governments who have already responded, including that of my island nation Barbados, must be commended for swiftly pointing resources towards social recovery. This must be applauded as it will set the stage for significant address of this “health crisis that has given rise to what I described as a social recession with severe economic and financial implications” in an earlier article.
Business owners and leaders, whether in manufacturing, retail, professional or financial services, now have a duty to re-look current pricing to bolster governmental social recovery stimulus and fiscal efforts. Across every sector; upstream and downstream tourism, travel, real estate and property rentals, it doesn’t matter, this crisis has dictated a non-negotiable resetting of prices. For those who take heed, consumers will say thank you in very meaningful ways in the near economic future. In fact, it will serve well for bolstering your social capital. That aside and given the severity of this crisis, it really is also the right thing to do.
Among the several benefits to be derived (and there are quite a few) are:
- The reduction of several million people slipping into and remaining in poverty for extended periods;
- Aversion of a protracted period of low production without commensurate reductions in consumption, which can invariably result in wealth depletion and exacerbation of poverty eradication efforts;
- Speedier return of the national and global workforce to productive purpose which, in turn will stimulate consumption and expansion of business and economic activity;
- General reduction in the cost of living for millions who prior to COVID-19, struggled to survive in an environment where price increases were occurring at a faster rate than salary growth;
- Reduction and better management of criminal activity that's born out of desperation, hunger and the need to survive;
- The instilling of confidence in upcoming generations of a future that is economically secure with prospects for accomplishing their goals and financial dreams.
Who knows? This crisis could very well be the answer to correcting other social imbalances that have eluded us for decades. Social balancing that will result in the hungry being fed, the impoverished finding shelter and the disadvantage realizing a glimmer of hope. Who knows? In the meantime, lets all do our part. Many hands make light work!
Jerry DaC Blenman, Executive Director of the Caribbean Center for Organizational Excellence, is an experienced financial analyst, organizational development and change management specialist.