We all saw it coming, maybe five or ten years down the road, but the pandemic accelerated everything.
For years, certainly, since the turn of the 21st century, it’s been creeping up on us. The winning players in the new retail economy have huge piles of money backing them. They are either venture capital-funded or public companies that can go on losing money while they wipe out smaller, more conventional competitors.
As COVID-19 began to close down our nation in the spring, only “essential” retailers were allowed to stay open in most states. So, retailers like Target, Walmart, and Costco, all of whom sell clothing, housewares, home textiles, and lots of other non-essential items, could present everything in the store to anyone, regardless of how essential. The major online players may have suffered a bit from lower demand for clothing while people were sheltering at home. However, they still managed to sell apparel, stealing share from smaller competitors.
All that leads us to where we are today. Many retailers, restaurants, service companies, travel destinations, and transportation providers are trying to pick up the pieces with one hand still tied behind their backs. It’s not easy, and many have already been lost. But the bigger, well-funded merchants will survive, as long as they were healthy at the start. Where does that leave the hundreds of thousands of small businesses and “essential” entrepreneurs? To a great extent, out in the cold. The stimulus money may have helped for a while, but now it’s running out as the nation goes into heavier debt. In the meantime, the stock market seems to be shrugging the whole thing off, ignoring the 30 million or so “little people” who are out of work and/or going broke.
Oy, that sure looks bad, doesn’t it? It is bad, but it also means exceptional opportunity over the next 5-10 years. Independent retailers who have survived, and who want to build back, will be doing it with fewer serious competitors. Entrepreneurs wanting to start retail, wholesale or online businesses will find lots of vacant real estate, low rents, talented employees, low interest rates, and hungry consumers looking for alternatives to big store and website sameness.
So, hang on if you can; brighter days are ahead, as always happens after a storm. Those who have the vision to change and catch the wave of the new consumerism are in for a long and happy ride up.