Question

Question 1.

a) Explain and give three (3) examples of challenges faced by small businesses in the era of Covid-19.                                                                                                            (15marks)

b) Mr. Kumah wants to cultivate perishable goods in Sogakope; a business which he has saved money for. Discuss three (3) post-operative problems he is likely to encounter.

Answer 1

1.(a). 3 example of challenges faced by small business in era of covid-19 are as follows-

A. Small businesses are facing up with liquidity risk in the covid-19 World as it can be seen that there is a lack of credit flow in the entire economy and the liquidity lower because the realisation is also lower. Small businesses like Uber and left are facing liquidity crunch.

B. There is a lack of demand due to lack of physical interaction and closure of business so it can be seen in lack of sales like smaller companies like Uber and lift has lower sales.

C. there is a large number of loss of human resources because there is a lot of layoff by the smaller companies, of their experienced workforce with employees like Uber and lift has laid off almost 30,000 of their existing employees.

B) Three post operating problem, he is likely to encounter are as follows-

A.loss of inventory will be higher because these are perishable goods in nature

B. There would be higher warehousing cost incurred because a lot of refrigerating has to be done as these goods are perishable in nature and they cannot be stored for longer period of time.

C. There has to be adequate matching of the demand and supply because any excess inventory on the part of business will be wasted instantly and there will be no realisable value as they are perishable in nature .