MidwestRetail No toilet paper? That’s just the beginning of retailers’ COVID-19 problems Dan Rafter March 16, 2020 Share on Facebook Share on Twitter Share on LinkedIn Share via email Trying to find toilet paper at your local grocer? Good luck. The coronavirus that causes COVID-19 is already having a huge impact on the commercial real estate world. And it might be having its biggest impact on the one sector that’s the most vulnerable, retail. This isn’t surprising. Governments across the country are advising people to avoid large gatherings of people and to avoid unnecessary trips outside their homes. Visiting a restaurant or shopping at the mall doesn’t rank as a necessity. And unless a retailer manages to land a treasure trove of hand sanitizer and toilet paper, the odds are it’s struggling right now. Many retailers are taking the most extreme of steps, shutting their stores until at least the last days of March to help prevent the spread of COVID-19. And in some Midwest states, governors are making this difficult decision for businesses. In Ohio and Illinois, for instance, governors ordered the closure of all the bars and restaurants in their states. These eateries will now only be able to offer pick-up and drive-through services. Apple is a good example of a retailer making the decision to close down on its own. Apple is closing its retail stores in the United States — and all others outside China — until March 27. “The most effective way to minimize risk of the virus’s transmission is to reduce density and maximize social distance,” wrote Apple chief executive officer Tim Cook in a letter on the company’s Website. Outdoor retailer Patagonia has also decided to close its 37 North American stores for at least two weeks. What’s interesting here, though, is that Patagonia has also closed its e-commerce site because the company has also shut down its offices. Urban Outfitters has followed the same gameplan, closing all of its stores and keeping them closed until at least March 28. And three subsidiaries of grocer Kroger — Harris Teeter, Fred Meyer and QFC — have decided to end 24-hour service for now in several cities. That’s so crews can clean the stores and restock shelves that have been picked clean. Even retail giant Walmart is altering its store hours. The retailer’s stores will only be open from 6 a.m. to 11 p.m. until further notice. Again, Walmart is making the move so that employees can restock shelves overnight and clean their stores. According to a recent survey from Chicago-based Digital Commerce 360, 47 percent of 300 retailers polled said they expect “some downside revenue implications” from the pandemic. The survey, Taking the Pulse: Retailers and the Coronavirus, found that 9 percent of respondents said they expected “significant downside revenue implications.” The good news from the survey? Retailers are not yet in panic mode. “The coronavirus is bound to have many consequences for consumers, but for retailers, this is uncharted territory,” said Lauren Freedman, senior consumer insights analyst at Digital Commerce 360 and the author of the report, in a statement. “Our findings suggest that most are cautious and taking some action, although it doesn’t appear that panic mode has set in.” The survey was conducted during the week of March 2, so retailers’ thoughts might be different today, now that Pres. Donald Trump has declared a national emergency. Even before this happened, though, survey respondents worried that consumer confidence would take a hit. According to the survey, 80 percent of respondents said they think COVID-19 will have at least some impact on consumer confidence, with 22 percent saying they thought it would have a significant impact. The impact on restaurants might be serious, too, as consumers worry about dining out. According to a letter sent from Andrea Johnston, chief operating officer of OpenTable, the online reservations site has seen a 20 percent dip in total seated diners during the second week of March compared to the same time last year. In Chicago, the total number of seated diners fell by 25 percent compared to the same week a year earlier. OpenTable said that restaurant business was falling more quickly, though, now that fears are rising in the United States. According to the company, on March 12, the number of seated diners fell by 30 percent when compared to the same day a year earlier.