As you and your loved ones settle into what is likely a very new daily routine, so too are our nation’s retailers. Many are temporarily shutting their doors, trying to make sense of their workforce while also meeting heavy demand for essential goods, like groceries, toilet paper, cleaning products and more.
With the retail landscape transforming before our eyes, reporters continue to cover the rapidly evolving situation. As mentioned in my last blog, COVID-19 has taken over nearly every aspect of the news cycle, regardless of publication and reporter beat, with no end in sight.
While headlines continue to focus on the spread of COVID-19 and its effect on the retail economy, three key themes in the market have emerged regarding the way retailers are responding to these challenges.
Temporary Retail Store Closures
Over the course of about a week, nearly 47,000 retailers closed their doors. Retailers and chain stores everywhere – outside of those that sell essential goods, like groceries – have temporarily shut down stores to help stop the spread of COVID-19.
While many are closing their doors, some are seeing exponential growth as consumers stockpile essential goods like food, medicine and cleaning supplies. Additionally, some retailers and consumer-facing companies are using their knowledge and supplier base to help fill the void in personal protective equipment, including masks and gowns.
This is having a rippling effect across retail workforces and emerging services like online grocery delivery.
- CNBC, March 26: Retailers shift production to make masks, gowns for health-care workers in coronavirus pandemic
- Bloomberg, March 24: 47,000 U.S. Stores Closed in About a Week Over Coronavirus
- CNN, March 22: Bed Bath & Beyond will close all brand stores until April 3
- Business Insider, March 15: Urban Outfitters, Nike, and 14 other major retailers are temporarily closing stores in an unprecedented move to prevent the spread of the coronavirus
- Bloomberg, March 11: American Dream Mall’s Next Hurdle Is Opening During Coronavirus
Retail Workforce Changes Due to Coronavirus
While the COVID-19 crisis has forced many retailers to temporarily close their doors, essential goods retailers like Walmart, CVS and Dominoes are grappling with surging consumer demand. Walmart, one of the nation’s largest employers, is taking on 25,000 new employees as it races to keep shelves stocked and checkout lines staffed. Amazon also announced it plans to hire an additional 100,000 employees, specifically for its fulfillment and distribution center positions.
On the other hand, with over half of its stores temporarily closed, fashion retailer H&M is considering laying off thousands of workers worldwide. Small businesses, which make up nearly 50% of the nation’s workforce, are also being forced to make tough cuts as well.
- Bloomberg, March 26: Walmart Hiring Surge Finds 25,000 Workers in Its First Week
- CNBC, March 24: As Walmart, CVS and Domino’s race to keep up with demand, they have a new challenge: Hiring during a pandemic
- CNBC, March 23: Fashion retailer H&M weighs tens of thousands of job cuts because of coronavirus
- New York Times, March 22: Help Wanted: Grocery Stores, Pizza Chains and Amazon Are Hiring
- USA Today, March 23: CVS to hire 50,000 workers, gives bonuses to employees amid coronavirus pandemic
Grocery Store Shortages and Delivery Services
As concerns around COVID-19 set in, many consumers began to stockpile grocery store items and other essential goods, like toilet paper, face masks and hand sanitizer. This has forced retailers to take drastic action by limiting certain purchases to not only curb shortages, but also price gouging practices.
Grocery stores have been struggling to meet surging demand. And with many staying at home vs. shopping for their weekly groceries in-store, online grocery delivery services have not been able to keep up. Amazon and Whole Foods began warning customers in early March about limited supplies and delayed deliveries.
Additionally, while meal box kits like Hello Fresh and Blue Apron have been slow to catch on with consumers, demand for these services is now soaring. Blue Apron recently announced it is increasing capacity and hiring to keep up with its growing list of orders.
- The Wall Street Journal, March 23: Grocers Stopped Stockpiling Food. Then Came Coronavirus
- CNN, March 20: How grocery stores restock shelves in the age of coronavirus
- MarketWatch, March 19: Blue Apron is increasing capacity and hiring workers to meet coronavirus-related demand, stock soars more than 500%
- The Wall Street Journal, March 18: Grocery Delivery Strains to Meet Voracious Demand
- CNBC, March 15: Amazon says it is out of stock of household items and deliveries are delayed due to coronavirus demand
What headlines stood out to you this month? We’re all living in unprecedented times, with a media environment that is extremely fluid. We will continue to closely monitor the media and market sentiment amidst the COVID-19 crisis. Message me or send me an email (firstname.lastname@example.org) if you’d like to receive our weekly summary and insights.