Retailers—a segment of the economy that was already up against the ropes—are quickly feeling the economic punch of the pandemic worse than other sectors. However, there are methods that some brick-and-mortar outlets can use to fight back.
Over the past fifteen years or so, consumers started to stay home in larger numbers, preferring the convenience of ordering online. With the sudden onset of COVID-19, shoppers have all but disappeared.
In the Chicago Loop, foot traffic was down nearly two-thirds week-over-week, according to Chicago Loop Alliance. Using pedestrian counters from the U.K.-based Springboard, the organization tracked pedestrian activity along Michigan Avenue, Wacker Drive, State Street and other parts of the Loop.
Comparing foot traffic between Tuesday, March 10 and Tuesday, March 17, they found a 63 percent decline. Over St. Patrick’s Day weekend, normally one of the busiest weekends of the year for the Loop, footfall declined by 42 percent compared to last year.
“It is no surprise that pedestrian activity in the Loop is declining as Chicagoans heed officials’ calls for social distancing, and we expect this activity will decline even further this week with the shutdown of bars, restaurants and major retailers, as well as Chicago Public Schools,” said Michael Edwards, president and CEO of Chicago Loop Alliance. “We think it’s important to connect data to these assumptions, and we will continue to monitor pedestrian counts and act as a resource.”
Similar to action taken in other states, Illinois Governor J.B. Pritzker mandated that all bars and restaurants in Illinois close their doors to dine-in customers for two weeks to reduce the spread of COVID-19. This life-saving measure will, unfortunately, have a major economic impact on these businesses.
“When conferences started cancelling and hotel occupancy began dropping, and with people working from home or working less altogether, we really felt it at Grant Park Bistro and Land & Lake Kitchen,” said Lauren Hammond, communications director for LM Restaurant Group. “This is an extremely difficult time for the hospitality industry, not just in Chicago but across the U.S. For an industry that already operates with the narrowest of margins and employs some of the most vulnerable members of our society, the effects of these closures are devastating.”
While e-commerce did much to disrupt brick-and-mortar retail, restaurants and bars weathered that storm, offering an “experiential” component that catered to consumers who still want to go out and socialize. In the age of social distancing, however, these businesses will struggle to stay afloat without some way to serve their customers.
There are options, however. For example, restaurant technology company Chowly has waived setup fees and is offering a 60-day trial for restaurants. Their platform integrates third-party online orders with restaurants’ point-of-sale systems and can better allow restaurants to streamline off-premise channels, such as delivery, carry-out and drive-through. Now, restaurants that generally relied much more heavily on dine-in orders than delivery or carry out can easily partner with delivery platforms like Grubhub, UberEats, DoorDash or Postmates.
“We want to help lessen the burden restaurants across the country are facing,” said Sterling Douglass, co-founder and CEO at Chowly. “Now more than ever, off-premise methods are critical for restaurants’ revenue streams. By helping restaurants add these alternatives to dine-in without any upfront costs, we are enabling them to continue to serve customers during these uncertain times and beyond.”
Tock, Inc., a software firm that develops reservation, guest, and table management systems for the restaurant industry, pivoted their efforts in the face of the pandemic. Their platform allows restaurants and pubs that don’t typically offer take-out or delivery to leverage their own staff—who would likely otherwise be filing for unemployment—to offer better adjust via tools like two-way text messaging for contactless deliveries.
This is a challenging time for all of us, from a health standpoint as well as a financial one. The situation—on both fronts—will only get worse before it gets better. In the meantime, there are measures we can take to preserve both our personal and economic well-being.