Czechs show entrepreneurial activity in spite of coronavirus economic fallout
Despite the coronavirus epidemic leading to a severe curtailing of normal economic activity, Czechs have not lost their taste for entrepreneurship. According to data from Bisnode, around 2,000 companies have been launched every month since the pandemic arrived in the country in March.
Jakub and Agnieszka are law students who used the vast amount of free time on their hands during the spring lockdown to start their own handbag business. They have since invested tens of thousands of crowns into the project, sewing together over a hundred handbags and launching their own online store to sell them.
They have already registered interest in their products since the site launched in August, says Agnieszka.
“There is a growing interest in our handbags. We will see how the situation continues to develop. It will depend on how we communicate our product.
“We started our project very much thanks to the fact that we could no longer do a lot of the activities common in normal times, especially those associated with the demanding student lifestyle in Prague. Instead, we started spending our evenings discussing ideas that we had only carried in our minds until then.”
Theirs is not the only business venture started during a time when ordinary economic activity is being severely curtailed due to the effects of the COVID-19 epidemic. According to the business data analysis firm Bisnode, around 2,000 new companies were founded in March, the month the coronavirus first appeared in the country, with a similar number of new business getting started every month since then. While the overall number is still 6 percent lower than it was in the previous year, it shows that Czechs are not afraid to explore new ventures despite a seemingly unfavourable environment.
The head of Bisnode communications in the Czech Republic, Petra Štěpánová, told Czech Radio which sectors are particularly attractive to entrepreneurs at the moment.
“Nearly one quarter of the newly registered companies state their activity as either trade, production or service oriented. One tenth is focused on renting out and administering properties, while 8 percent of new businesses define themselves as non-specialised wholesale traders.”
Interestingly enough, catering and food stand businesses are also being set up, despite the hospitality industry being among the most heavily impacted by the government measures put in place to curb the spread of the coronavirus. A total of 898 companies have sprung up in this sector over the past nine months.
The president of the Association of Hotels and Restaurants, Václav Stárek, says that the state of emergency has actually helped several restaurant owners by forcing them to improve their services.
“These are people who have found out that gastronomy can be done differently. That not yet fully explored tools such as online applications can help in communicating with customers. [As a sector] we have been forced to reconsider our methods at a time when meeting in person, or going to the restaurant is not possible.”
Pavla Břečková from the Association of Small and Medium-Sized Enterprises and Crafts says the numbers are very good under the current conditions and serve as proof of Czech creativity. She says that now it is important to ensure companies are supported through payment deferrals, advantageous credit and help with covering staff costs.