The way the world purchases products is going to change more than most thought it would. Experts say a lot of our favorite brick and mortar merchants will be waving the white flag.
In a very depth feature by The New York Times several analysts do not expect many national chains to survive wrath of COVID-19. According to their statistics clothing and accessory sales fell by more than 50% in March. As expected some brands have pivoted to offset their loses. Lord & Taylor has laid off their entire executive staff in early April. Nordstrom has reportedly cancelled all orders and has delayed paying out their vendors. It is also speculated that Neiman Marcus will file for bankruptcy in the coming days. In turn other companies have look at restructuring options including Macy’s and J.C. Penney.
But to hear some pundits call it this is just the beginning. “The department stores, which have been failing slowly for a very long time, really don’t get over this,” theorized Mark A. Cohen, the director of retail studies at Columbia University’s Business School. “The genre is toast, and looking at the other side of this, there are very few who are likely to survive.”
While the report is nothing short of tragic it shouldn’t be a surprise. Last week unemployment reached a staggering 22 million which rivals The Great Depression. Additionally this will cause a further domino effect as apparel retailers make up almost 30% of all total shopping mall square footage across the country.
The holidays have historically been the strongest sales season but even this prime two-month window is looking very shaky. “Nobody knows what Q4 will be like, but you have to start putting the orders in now,” explained Sucharita Kodali, a retail analyst at Forrester. “Some people don’t even have the money to put in Q4 orders, and may have to cancel Q4 orders anyway, and it’s a mess. There’s never been this much uncertainty.”
While some cities are slated to open back up soon the country clearly has a long uphill hike to get back to a more solid economic footing. In the meantime save your coins.