It will take no less than a year from hereon for normalcy to return to businesses that have been devastated in the past four months following the novel coronavirus outbreak, said SM Ashraful Alam, managing director of Walton Hi-tech Industries.
A vaccine will be available by this year, he said, referring to anticipations of the World Health Organisation and quite a few research organisations.
Meanwhile, people have already started venturing out of their homes and in many instances going about their business so as soon as the vaccine sees the light of day the situation will become normal very fast, Alam told The Daily Star in an interview last week.
But all businesses will not fare the same when it comes to recovery, said the top brass of Walton, which manufactures a host of household electronic products including refrigerators, freezers, air conditioners (ACs) and compressors since early 2008.
"So our business will take more time compared with the food business, whereas the business of luxury products will take the highest time to return to normalcy that had prevailed before the arrival of the pathogen."
An economy is dependent on a country's consumption level but the consumption of people was affected for the pandemic. Consumption slumped not only in Bangladesh but in the whole world.
So, the economic impact was massive, be it on investment, employment generation or international trade, he said.
Walton, which was founded in 1977, witnessed tremendous growth in its business performance until the 2017-18 financial year, when natural calamities in the form of flood hit hard, coinciding with a huge amount of investment they had made that year.
"Our performance bounced back the following year thanks to the huge investments and extreme marketing."
In the 2018-19 financial year, Walton's revenue soared 89 per cent year-on-year to Tk 5,177.3 crore. The company's earnings per share stood at Tk 45.87 in that period.
Walton's target was to boost its profit in the 2019-20 financial year riding on the additional benefits of the investment that was made the previous year.
With a paid-up capital of Tk 300 crore, Walton is already in the process of raising Tk 100 crore in capital this year from the stock market through an initial public offering.
"However, the pandemic had a big impact."
The main sales season for refrigerators, the top-selling product of Walton, begins in March. This year, it was spoiled for the coronavirus.
Bangladesh's first cases of COVID-19 were confirmed on 7 March and three weeks later the government put the country on shutdown until 30 May.
"Along with the domestic market, our export market was also smacked down by the contagion. We had targeted to complete our shipments within October to November so that we could grab the Christmas sales."
But all preparations have been impacted.
The company had orders for 2.5 lakh refrigerators and 22,000 ACs from India. It only managed to dispatch 2,000 ACs, with the rest deferred.
"Now, we are recovering from the situation but still we fear a fall in our profits and turnover by at least 30 per cent. Hope lies in the fact that the impact was not as bad as we had feared."
Fearing the worst in early March, Walton had stopped all new investments, procurement of raw materials and kept a big amount of money with banks to ensure that its employees get their salaries, Alam said.
Just before the general shutdown began on 26 March, Walton disbursed Tk 77 crore among its 20,000 employees in 22 production bases from the profit-sharing fund for the 2018-19 financial year.
"In this pandemic period, we are trying to provide some relief to people and frontline health workers."
The company also started work on manufacturing various lifesaving medical equipment including ventilators, protective face shields, safety goggles, UV-C disinfectant system and medi-cart robot alongside hand sanitisers.
"We are yet to supply the ventilators in the market but we are ready to produce 100 ventilators as soon as we get approval upon completion of clinical trials."
Now, Walton can manufacture 8,000 international standard face shields and more than 8,000 safety goggles a day. They are sold at home and abroad.
"We always try to meet people's demands with new designs and modern technology, so if you go to a shop after three months you will surely find a change in every product of ours. This is a continuous process of ours."
Apart from these, Walton is also expanding its washing machine factory and the factory of some home appliances like clothes iron, blender, induction and rice cookers, microwave oven and components along with base polyol chemical factory, which will be used in the rigid and flexible foaming industry.
"We are extending the investments in these products as local demand is rising as well as global demand. The local consumption of these products is still not so big but it is growing. So, there is huge potential," Alam said, adding that the consumption would rise along with urbanisation and growth of per capita income.
Alam also touched upon the thorny subject of job and pay cuts amid the pandemic.
Many companies were cutting jobs during the pandemic, which was not a good decision because employees are assets, he said.
"When the situation will turn around, how will you find efficient people? Moreover, if you don't stand by your employees in times of peril, you will not get the real dedication from your employees when things are normal."
To ensure adequate liquidity at hand at this juncture, entrepreneurs need to take measures.
"But cutting jobs cannot be one such measure. They can halt capital investment right now to manage liquidity."
He recommended people diversify their products. For diversification there should be a target to attain specialisation; otherwise, it would not be possible to compete in the market.
He said patience is of the essence to survive during such a critical time. "If people survive, profits will come again."
Walton began its manufacturing journey as a motorcycle manufacturer but later pivoted to electronics.
Asked the reason behind the move, he said they stopped producing conventional motorcycles because the major sources of the world's best engines were on their way to closing down.
Engine-run motorcycles are going to turn obsolete globally, so Walton is shifting to battery-run engines. "However, our people are still fond of engine-run big motorcycles."
Walton has a plan to go for bulk production of battery-run electric motorcycles depending on suitable policy support from the government.
It already has the production plants for batteries and motors of international standard, which are needed to produce electric vehicles, he said.
Responding to another question, he said they were now focusing on ensuring high quality, for which they were using copper condensers in refrigerators.
Copper condensers increase the life span of the home appliance and make those more energy efficient.
"We produce our refrigerators with the thought of keeping those usable for 20 years."
Walton is producing compressors with technology developed in Germany and has an annual production capacity of 4 million. The company has targeted to manufacture 10 million compressors annually within 2025.
"Our compressor is the world's most silent, whose noise level is 28 decibels on an average, whereas, other global manufacturers' products have noise levels of 35 to 42 decibels. As our product is new in the global arena, we tried to ensure good quality so that people get amazed by the performance."
Walton exports its products to more than 35 countries, including the US and Europe, and now it is working to expand the market to South and North America, Russia and different European countries.
"We are targeting to export 1 million compressors by 2021, which is expected to increase to 5 million by 2025. We are marching forward to become the world's fifth top electronic products and components manufacturer by 2030."
To meet the ever-increasing demand for highly efficient, lightweight and cost-effective compressors, its research and development team is working to develop a new series of high COP (coefficient of performance) inverter compressor that will set a new standard of performance all over the world and will be introduced by the end of 2021.
"Once we had some limitations in developing modern technology. But now, we have complete R&D facilities comprising highly trained and skilled engineers from home and abroad. So, our quality has developed massively in the last five years."
The company has a laboratory named NASDUT-UTS that maintains global standards and certification for quality testing.
Its certification covers at least 80 per cent of the countries for quality, safety, including of the environment, energy efficiency and many more.
"We had to spend at least 10 years building up this infrastructure, which in other places is built by the state."
Alam recommended ensuring a level playing field for every industry, saying it is necessary for businesses to flourish, create enough jobs, reduce import costs and give a boost to economic prosperity.
"Though many timely initiatives of the government geared up the development of the local industries, there are more things to improve and policies to amend."
He highlighted that the import duty on some hi-tech products and components were higher than the imported finished goods, a situation which halts the progress of the local industry and, to some extent, discourages entrepreneurs.
Alam cited the example of Taiwan, where the government authorities highly encourage industrialisation and create a level playing field for local producers.
The country has an authority that stays tuned to the needs of entrepreneurs and analyses which sector needs what policy support, for which the nation's exports is big in context to its population.
Taiwan's exports amounted to $329.3 billion in 2019 when their population is 2.36 crore, according to the World Bank data.
Bangladesh has huge potential as business relations among the US, China and India are deteriorating.
So, the government needs to provide suitable policy support now for industries to flourish and grab the opportunity, he added.