COVID-19: Impact on Small Business Supply Chains - Essay Sample

Introduction

The hearing's title is "Corona Impact on Supply Chains." The senate small business entrepreneurship committee met for a hearing to discuss the impact that coronavirus will have on small businesses and their supply chains. Twelve witnesses were in attendance to address the issue and get solutions for the problem. Marco Rubio, a Class 3 United States senator, chaired the meeting. The other witnesses were senators Gerard Anderson, Wynne Briscoe, Ben Cardin, Rosemary Gibson, Tim Morrison, Jacky Rosen, Todd Young, Cory Booker, Josh Hawley, Mazie Hirono, and Jeanne Shaheen.

Is your time best spent reading someone else’s essay? Get a 100% original essay FROM A CERTIFIED WRITER!

Save 25%

Background Information

Coronavirus has caused significant disruptions in the supply chains in the United States, and small businesses are feeling the most significant impact. The situation continues to escalate, and it will create several vulnerabilities in supply chain mapping. The United States majorly relies on foreign medical supplies from China, which is highly affected by the pandemic. China's situation makes it impossible to import drugs and other medical supplies like gloves and ventilators, which are crucial for coronavirus patients. Therefore, the United States must rethink of alternative strategies to deal with the disrupted supply chain and assist small businesses to thrive through these challenging economic times. Employees in the various sectors will also need significant monetary assistance for survival.

Summary of the Testimonies Heard

One of the speakers was Marco Rubio, who is a Class 3 United States senator representing Florida. The main issue that Rubio addressed is the disruption of cash flows, business, and employees. It is possible that some businesses may completely shut down. The second issue is the unpredictability of the supply chain. Rubio expressed his concerns regarding testing kits, and he said it would be an issue in testing if there are no protective gear and basic materials for testing the virus. Rubio explained that one of the strategies that could be used to save small businesses is by allowing flexibility and allow them to use borrowed funds to pay their employees and provide sick leave.

Ben Cardin, a Class one U.s senator of Maryland, also spoke during the committee. Cardin's major points were that the country needs to be more prepared regarding matters of supply chains in crisis in the future. The first priority would be dealing with medical challenges since the country is not effective enough in testing as it should be. The United States has started manufacturing drugs that may assist during the crisis.

Rosemary Gibson is an author, and she contributed to the committee. Gibson's main points were about the small businesses that are prepared for the production of drugs for people that are already hospitalized with Covid-19. However, the main issue is on allocation since some hospitals in the United States have no access to generic drugs.

Gerard Anderson is a director at John Hopkins University. Anderson expressed his worst fear and concern as small business people going to work amidst Covid-19. Small business will keep running because such people do not have sufficient funds to keep their offices closed for fourteen days. Many small businesses have vast debts, and many employees are uninsured. Anderson also explained that the U.S. government could support biotech industries by guaranteeing them a place to sell their products.

Tim Morrison, a senior fellow at Hudson Institute, also spoke during the meeting. Morrison's primary concern was the overdependence of the United States on China for essential healthcare commodities. The U.S. stopped its domestic production of penicillin without any directive from the executive. Morrison explained that American job creators and innovators must be protected by the government by all means. He supported the amendment regarding the reliance on the P.R.C. for pharmaceuticals.

Wayne Briscoe is an acting director of the Small Business Development Center in Maryland. Briscoe's primary point was the opportunities that the disruption of the supply chain presents on small businesses. The current supply chain opportunities can significantly assist small businesses after the coronavirus crisis ends.

Josh Hawley, a Missouri Class one senator, explained that the United States has been over-reliant on China for essential products like medicine. Hawley introduced legislation in the Senate that would give the Food and Drug Administration to enforce a law that requires domestic medical manufacturers to report all the details of their supply chain.

Cory Booker, a New Jersey senator, explained about the nationwide consequences of a lockdown and what it means for small businesses. The senator proposed that the United States should not be dependent on China for the supply of essential products like medicine. The U.S. should advance its manufacturing technology to prevent medical vulnerabilities in the supply chain in the future.

Stakeholders Who Will Be Affected by the Policy

The proposed economic policy will affect stakeholders like employers, consumers, and providers. As stated earlier, the disruption of the supply chain has halted the importation of crucial medicinal drugs and testing equipment required for the testing of Covid-19. Employers in small businesses are likely to suffer due to the directives issued by the government due to the ongoing pandemic. The disruption of the supply chain means that small businesses will have insufficient funds to pay their employees and compensate for sick leaves. However, the proposal from the senate committee is that such employers owning the affected small businesses should use their borrowed funds to make payroll and cater for those on sick leaves. The community bank process will be essential to loan money to small businesses immediately since employees cannot wait to be paid after three months. Marco Rubio explained that if the state is going to commit itself in helping small businesses, the process must be quick and effective.

Secondly, the coronavirus pandemic is leading to the shutting down of factories due to the disruptions in the supply chain, thus affecting the availability of consumer goods. According to the census bureau, China accounted for most of the electric hand drills, cell phones, and electrical machinery. Thus, there are shortages of such materials in the United States currently, and small businesses will experience economic pain. However, these small enterprises may benefit from the increasing demand in the healthcare sector. The United States requires a surplus supply of surgical masks and pharmaceutical drugs, and small-scale business people can fill the gap by manufacturing the essentials domestically. Business people may also focus on producing testing kits that are in high demand. The economic policy will empower small businesses to produce critical goods in healthcare and get American multinationals to purchase domestically from them for both national security and economic stability.

Employees will also be affected by the proposed economic policy in various ways. Businesses are shutting down. For instance, hair salons export most of their products from China, and there are no ongoing deliveries at the moment. The government's directive has led to the closure of schools and other institutions, schools, trips, and gathers that were vital sources of income for small businesses. The supply chain disruptions in the various sectors have a significant impact on employees since they are being granted compulsory leaves. However, small businesses are urged to take advantage of the emergency supplemental for economic disaster injury loans to sustain them and their employees during the pandemic.

The other stakeholders that have been significantly affected by the economic policy are the suppliers. According to Rosemary Gibson, 90% of the chemicals required to manufacture sedatives and other medicines are sourced from China. Suppliers are the people at the center of a supply chain since they connect the manufacturer with the buyers. With the supply chain disruption and lockdown, medical supplies like masks, testing kits, drugs, and ventilator machines are no longer being imported from China, where the United States sources most of these merchandises. Small scale businesses in the supply business are feeling the economic pain since they can no longer do business as usual.

Observations and Analysis

There was a balance of the perspectives that were presented by all the witnesses. First, everyone focused on how the disruption of supply chains and how the situation is affecting small businesses. The witnesses were also focused on devising strategies to assist these small businesses to survive despite the significant supply chain disruptions. The most effective solution that was proposed by the majority of the members is the need for small businesses to take advantage of the loans being given to sustain themselves and their employees, especially those on sick leaves. Members also proposed for the need of these small businesses to take advantage of the crisis and manufacture medical products domestically.

The testimonies that seemed most effective were those from Wynne Briscoe's and Gerard Anderson's. Anderson was familiar with the situation on the ground since he had visited some small-scale business prior to the meeting. He proposed that small businesses should be given grants for the next ninety days since they already have huge debts. He also proposed on how congress can assist small biotech firms in developing the corona vaccine and how to provide telehealth services to the people in rural areas and those who are quarantined. Briscoe, on the other hand, explained that small businesses should be provided with a long-term solution to assist them economically even after the coronavirus pandemic. The supply chain disruptions offer several opportunities for small-scale enterprises where they can produce their products in the supervision of the F.D.A. and domestically distribute them across the state. In that way, small businesses will benefit in the long-term.

The perspective that was missing was on the challenge of manufacturing and distributing domestic products with the current policies. For instance, the government is gradually curbing the movement of people from state to state, and that is a significant problem. People are also required to self-quarantine, which may reduce the availability of employees and increased sick leaves.

The experience has changed my understanding of the political and legislative processes since it shows how politicians give their views and opinions and devise solutions for specific problems.

The hearing to the economic policy was essential since it sought to address how small businesses can be helped due to the ongoing supply chain disruptions. The goal is to assist such companies in thriving even after the crisis.