While Many Stores Are Closed, Some Retailers Are Winning Big With High Demand From Coronavirus
Let’s face it: None of us want to be cooped up in our homes. We are all concerned about coronavirus and what it will mean for our future. And retailers are worried about merchandise aging on the racks and shelves without getting a chance to be admired and sold.
I think there will be humongous markdowns when store doors open again, since I do not believe stores will open after the two-week hiatus initially announced. I expect the closure period to be extended for at least another four weeks beyond that—and I know that my friends think I am being too optimistic even suggesting it may be only another few weeks. They think it will be longer.
Most companies have withdrawn their sales and earnings forecasts for the current fiscal year. If they have not, they should since no one can predict the effect of the coronavirus pandemic we are now encountering. With no clear sense of when any normalcy may return, some companies have tapped their credit facility to insure liquidity.
However, there is good news for some companies. These companies have basic food, healthcare and household items, along with supplies for remote working and learning that people want and need. So it’s no surprise that customers are rushing to get those items right now. The six companies I’m talking about are:
Amazon
Best Buy
Costco
Kroger
Walmart
Whole Foods
Amazon: This online giant benefits from its extensive, well developed home-delivery capabilities. Customers like the Prime program, which ensures quick delivery. Demand has been overwhelming for much-needed daily living merchandise that can be shipped from the Marketplace.
Best Buy: The company has seen a surge in demand for products needed to work or learn from home as well as products to refrigerate or freeze foods. Best Buy has enhanced its curbside pick-up service for all stores. In addition, employees have been empowered to get merchandise from the stores and sell it curbside. Employees have been told that they do not have to work if they do not feel comfortable. The company has withdrawn its financial guidance.
Costco: The rush to Costco is well documented. Paper goods, groceries, produce and practically everything else is in strong demand. Lines are in front of the stores hours before they open. Management and associates have been working 24/7 to help suppliers rush goods to the stores, since customer demand is unprecedented. I have been trying to get some merchandise from the company, and despite my age I am unable to obtain it since it is sold out online. I would have to go to a store.
Kroger: Kroger announced appreciation bonuses for full-time and part-time employees who are on the front lines offering customer service around the clock, according to Rodney McMullon, Kroger’s chairman and CEO. In addition, the company expanded its 14-day COVID-19 emergency leave guidelines. This supermarket chain, which serves 11 million customers daily, has been overwhelmed by customer demand.
Walmart: Walmart is benefiting from the rush to fill pantries with groceries. Food is selling well, and the assortment of paper goods and medical supplies all make it a must to shop the 4,700 Walmart stores in the U.S. John Furner, CEO of Walmart U.S., thanked his employees for the hard work they are doing and told them they would receive a special bonus on top of any regular bonus they receive. In addition, he announced that the company would accelerate hiring of 150,000 additional new associates for the stores, clubs and fulfillment centers to help deal with the strong current demand.
Whole Foods: This is now an Amazon company. My observation in the New York City area is that this company, like all food companies, is overwhelmed by demand. The company opens its stores for seniors 60 and older at 7 a.m. to give this population access when stores are not crowded. The stores otherwise open at 8 a.m. They have closed hot bars, salad bars and antipasti bars. Seating areas are closed and will offer takeout only. Stores are closing two hours early so that associates can restock shelves, sanitize stores and prepare for the next day. In addition, part- and full-time employees have received a $2-an-hour raise and will receive double pay for overtime. It indicates, which I can confirm, the overwhelming demand the company has to cope with.
All of these companies have the good fortune to sell merchandise most in demand these days. And they are stepping up to recognize the dedication and hard work of their employees to meet this demand. Their devotion to help customers is a real tribute to their American spirit, and I applaud that. I hope we will see the end of the growth of this pandemic scourge and see a return to more normal routines soon.
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