Guess who bought up real estate post-2009 crisis, when prices were at rock bottom? Wealthy individuals and corporations that had enough assets to withstand the storm and capitalize on a down market.<p>Guess who will grab more market share post-COVID? Better yet, guess who <i>wasn't</i> affected by forced lockdowns and benefited during the worst of COVID?<p>I find it very distressing that this massive transfer of wealth from small businesses to megacorps isn't being discussed more.
In the Bay Area, a lot of stores are closing down, not 50% but probably around 30%-50% range depending on which part. Places with less traffic are getting hit harder (obv).<p>The thing that you have to understand is that the smbs were competing with other local smbs. So your favorite local coffeeshop only had 4 other competitors (not in SF lol). Ppl who used to type in "yoga classes near me" will be typing in "yoga classes online". Now they're competing against everyone on the internet. Against everyone who has a 5 year lead on them with SEO and marketing. There's just no way an SMB can take them, nor is there enough incentive for digital agencies to help b/c it's such a long shot that they can produce result for the smbs.<p>Unless there's some search engine that ranks based on locale rather than standard SEO, but that's just not happening.
Anecdote - I had a small amount of money invested in SME lending through an online p2p lending platform since last year (UK). Not super high interest rates, about 6-8%, all "AAA" rated businesses. Before covid, default rates were a couple of percent.<p>Right now 25% of the businesses in the loan book are late with repayments, I expect many of them will default and stop trading. And this is while government subsidies are still going - the subsidies will soon stop.<p>Covid has been devastating for small businesses which don't operate online and unfortunately I think the fallout will continue up to a year, until we get mass vaccination.
In my area, I'd say about 50% of the storefronts in any shopping area are brown-papered.<p>The other side of this, is that larger business are taking advantage of the small business' desperation, to buy them at rapacious prices, or coerce them into really bad deals.<p>Meaning that some of the small businesses that "survive" this downturn, have just postponed death.
This article omits the other half of the one-two punch many small businesses have endured this summer, losses from civil unrest.<p>I'd recommend this piece: <a href="https://medium.com/@mtracey/two-months-since-the-riots-and-still-no-national-conversation-12a7e3e4e006" rel="nofollow">https://medium.com/@mtracey/two-months-since-the-riots-and-s...</a> It's a somewhat long-winded bit of reporting, and has a certain media-cynic slant to it, but gives an on-the-ground perspective into how businesses in less-populous areas affected by the unrest in late May have been coping.
This is the undercurrent of the pandemic's impacts. Businesses are disappearing by the tens of thousands and they are not necessarily represented in the normal metrics of bankruptcies.<p>Unemployment and GDP are impacted by these closures, but without showing up as their own segment, not much is being done to counteract it.<p>Retail & shopping centers are looking like ghost towns, and that is not good for overall economic health once we get to the other side.
A friend of ours made a good living making wedding and prom dresses employing about 6 people ... she shut shop this month as weddings are limited to only 50 people and most churches, hosting venues and schools are all shut.<p>Folks have more pressing worries on their plate than weddings or proms.
For small businesses that are able to move online, there is no shortage of revenue available. In the article they mention a yoga studio owner closing up her shop. I agree that a yoga studio is pretty tough to move online. They also mention a jewellery brand, and that is exactly the type of boutique business that can be successful right now with the right marketing and ecommerce solution. My partner does online sales and marking consulting, and every one of her clients has at least doubled revenue within one month of onboarding. Most of them now have problems maintaining stock, not making sales. I don't know if these healthy sales will last, but for now I'm not seeing any ceiling for small businesses who make something or sell a service that works online. My guess is that a lot of SME owners just aren't aware of how to approach online sales.
It’s probably more relevant for Australian businesses (and uk & nz, based on subscribers) but Xero does have a project that releases statistics about overall business health and the economy from a SMB perspective.<p><a href="https://www.xero.com/small-business-insights/" rel="nofollow">https://www.xero.com/small-business-insights/</a><p>Again, it’s likely to undercount low / no-tech businesses and over count those that were already looking towards technology as a differentiator (having decided to move their accounting to the cloud)
Who the hell killed the comment on the booming patio business? Here, pools have become all the rage. People cannot go on holiday, but enough people still have money. So what do they do? They try to make their home to resemble their holiday dream as much as possible, with decks, pools and outdoor furniture.
Isn't this tracked to some degree in unemployment stats? Is being laid off from a small business that different from being laid off from a large business?