2020: The First of All the Years for the Rest of Our Lives

Let us examine the phenomena preceding the tipping point and their relationship to human consciousness and the impact of human actions on society: as a technological force, the digital revolution has bridged physical distances and democratized knowledge; however, it has brought with it issues related to security on a global scale, as well as the “Googling” of popular science; environmental catastrophes due to mismanagement by decision-making centers, governments, and companies that for decades condoned the use and abuse of natural resources; geopolitical antagonisms have been a source of instability, as have social tensions stemming from racial and religious conflicts. Events around the world have shown how inequalities have worsened and are the seedbed for activist movements such as Black Lives Matter and Me Too. We were supposed to have a more equitable society.

The COVID-19 pandemic has brought people’s lives and the normal functioning of institutions to a screeching halt, plunging them into a state of imminent crisis. The spread of the virus, its impact on physical health, and the resulting economic and social consequences have indiscriminately affected the entire society and stripped away the umbrella of privileges under which certain countries had systematically sheltered themselves. Uncertainty about the future has become a form of collateral damage on a universal scale, resulting from the loss of value in economic chains and the specter of future hardships, including business and personal bankruptcies. As we witness this complex collapse of the system, feelings of insecurity and fear are on the rise, with profound implications for people’s happiness and mental health.

The year 2020 looked set to be one of growth, given the rise in domestic consumption, driven by the positive outlook in certain sectors of the Portuguese economy. Tourism and export growth promised a golden year, including for the optical industry. Consumer confidence would drive demand across all retail sectors, and ours—due to its unique nature and association with comfort and health—would be no exception. Vision is a distinct aspect of human nature and, with the digital revolution, plays an even more decisive role. World history is replete with disasters that, like this pandemic, have disrupted economic cycles and decimated populations. The state of emergency and lockdown that began in the second half of March affected domestic demand and had a negative impact in the first half of the year, causing a drop in sales. Our organization experienced a drop of approximately 30% in sales volume. This result was largely due to the months of April and May. Our commitment to the social responsibility inherent in our business led us to keep all stores open, with the exception of those that were forced to close due to their location. In June, while society was grappling with the effects of mandatory closures, rising infection rates, deaths, and fear, the optical sector as a whole resumed commercial activity with a vigor far surpassing that of most other retail sectors. This helped ward off the specter of bankruptcies and unemployment.

Are we prepared to mitigate the risks of the coming year? As of now, the International Monetary Fund’s latest forecasts for 2021 point to a negative growth rate of 2.7% for Portugal. Compared to its initial projections, this same IMF indicator signals an improvement in economic conditions for the current year. First, the vaccine must prove its effectiveness, and the government must ensure its planning and distribution are fully controlled. Next, it is essential that government support meets the needs of most businesses, which unfortunately seems difficult to me. Economic aid will eventually come to an end, and tax payments, even if spread out, will accumulate. Bank payment moratoriums and rent deferrals will no longer be extended, and if unemployment reaches unexpected levels, pressure on companies’ cash flow will increase. The risks of economic uncertainty will force management decisions for which we are unlikely to be prepared. The measures made available by the government to support the economy are merely a stopgap. Essentially, we will need consumers with cash on hand and the confidence to spend. This will be the intricate puzzle that governments will have to solve. Regardless of each organization’s reputation, ensuring stable cash flow—whether through the use of equity, bank financing, or other support measures—appears to be the most sensible strategy. In the face of economic uncertainty, managers will need emotional stability to rationally assess risk when making decisions. There is no one-size-fits-all guide for every type of business. This sector has specific characteristics stemming from the hybrid nature of the business—combining healthcare and commerce. These factors give it consistency. The long-term relationship built between the optical professional and the customer is the key element that fosters trust. The major shift in consumer behavior that has been taking place will not diminish the value of trust at the moment of decision. I remain convinced that the path to recovery will be easier for companies whose culture is grounded in that value and in the transparency of their processes. Unfortunately, we cannot be certain, but for the sake of stability and building the future, we must continue to fight with the same conviction as always.

The pandemic has highlighted the interdependence of markets. Lockdowns brought society to a standstill, restricted the free movement of people, and, as a result, all other economic sectors and subsectors were affected. In its latest forecast for Portugal for 2021, the OECD projects growth of 1.7%, driven by an increase in domestic consumption. This is a difficult equation to solve when we consider the unemployment figures.
In times of crisis, the low-cost market is likely to become a refuge for consumers in our sector. This happened in 2009 during the sovereign debt crisis, when low-price offerings gained traction and captured a share of the market. We seek to find a path that ensures the sustainability of organizations, even though some of them have grown and continue to operate without a defined strategy, thanks to a market with still-comfortable margins. Forgive me for the figure of speech, but we are still the rich relative of the retail sector.

To put into context the stress and anxiety people have been exposed to during this pandemic, we must understand the endless challenges we are all facing. The fact that we understand the necessity of isolation does not exempt us from feelings of insecurity, which are responsible for countless psychological disturbances. The fear of being infected by the virus, the fear of losing our jobs, or the fear of being unable to overcome the looming crisis makes us vulnerable, and the impact on mental health is immeasurable. Conflicts in professional settings can arise more easily, and productivity will be affected. This new reality underscores society’s responsibility to set more ambitious goals for mental health care for those who have experienced trauma. This is a generation that, within the span of 10 years, has been subjected to two major social and economic crises. We can also easily see how the frequency of these disruptive phenomena tends to increase, even though their duration is shorter. Paying attention to the well-being of teams is an investment in the future.