Covid-19: The Nightmare for All Business Owners
By Saran (Mighty) Burapachaisri
Credit: Freekpik
We are entering lockdown…
For a time, the school closed down. Waking up at 5 a.m to drive to school through the busy streets of Bangkok was no longer a regular occurrence. Now, it’s just five steps to your laptop and pressing the “Join a Meeting” button that will teleport you into your classroom. Raising your hand to answer a question still makes you feel like a fool, but spending recess laughing at your own jokes is just a bad memory, and leaving the house is the number one thing on your bucket list. Prepare yourselves, we are entering lockdown once again…
The Pandemic
The coronavirus pandemic impacts millions of people throughout the world. It affects a child’s ability to grow and fully experience their childhood, teenagers from…well, being teenagers, and adults from working and running businesses like they used to. Many businesses have to enforce new work conditions. Some adopted a “Work from Home” lifestyle, which, as the name suggests, simply means working from their home rather than working from the office. While for others, traveling restrictions meant the lack of consumers, unemployment, and a sad ending for a promising business. As customers pivot to online shopping and consumer demand falls, numerous businesses have filed for bankruptcy. Here are some of the most iconic, brand-name bankruptcies that have become prey for the pandemic:
Credits: Thai Ticket Major
Dean and Deluca
Business: American Gourmet Restaurant
Date: April 2, 2020
Summary: In a decline since 2014, the iconic American gourmet restaurant Dean and Deluca filed for bankruptcy on April 2, 2020. It was first established in the busy streets of New York in September 1977 by Joel Dean, Giorgio DeLuca, and Jack Ceglic – three best friends who have a great passion for food and its ingredients. Currently, Dean and Deluca is under a rehabilitation plan, which allows them to resume business and continue operations. However, this rehabilitation plan will not affect Thailand and Asia operations.
Credit: https://www.autonews.com/
Hertz
Business: Car Rental
Date: May 22, 2020
Summary: After 100 years of business, Hertz, a car rental company founded by an ambitious pioneer of auto renting named Walter Jacobs, has filed for Chapter 11 Bankruptcy. With Covid-19 establishing travel bans and commuting restrictions, the tourism industry took a big nosedive. Because of this, Hertz was under $18 billion of net debt, having to get rid of 200,000 cars by the end of this year, according to UNITED STATES SECURITIES AND EXCHANGE COMMISSION.
Credits: https://www.muji.com/
Muji
Business: Japanese consumer goods
Date: July 10, 2020
Summary: First founded in December 1980 in Japan, the US unit of the Japanese consumer goods chain filed for bankruptcy protection on July 10. With incredibly expensive rent, Muji was forced to close many of its prime retail stores, succumbing to the Covid-19 Pandemic. In 2020, Muji’s US operations suffered a loss of approximately $10 million.
Credits: Wikipedia: JCrew
J. Crew
Business: Women’s, men’s, and children’s apparel
Date: May 4, 2020
Summary: J. Crew is a clothing brand that specializes in comfortable, preppy-style clothing. First founded in 1947 in New York, J. Crew found themselves a victim of the pandemic early last year. According to Michael Nicholson, J. Crew’s COO, the company projected a staggering $900 million decline in sales after closing its stores in March.
Credits: https://archiplexgroup.com/
Sizzler
Business: American steakhouse chain
Date: September 21, 2020
Summary: Founded in 1958, Sizzler is a restaurant known for its salad bar and scrumptious pizza. However, the American steakhouse chain has sought bankruptcy protection in September of 2020. Sizzler’s president said, “…our financial state is a direct consequence of the pandemic’s economic impact due to long-term indoor dining closures and the landlords’ refusal to provide necessary rent abatement.”
Covid-19 has become a ruthless predator for all business owners. The lack of customer demand, quarantine restrictions and unlessening is the combination of the scariest nightmare for all business owners. In 2020, America alone averaged a staggering 800 business closures per day (Yelp: Local Economic Impact Report). Additionally, more than “60% of business closures due to the coronavirus pandemic are now permanent”(Yelp data shows 60%…). These terrifying and unprecedented numbers show how impactful Covid-19 has been to businesses and the economy. As pharmaceutical companies such as AstraZeneca, Johnson & Johnson, Pfizer and many more rush to produce Covid vaccines in this troubling time, this might be the hope business owners are dreaming of. But until, uncertainty is the only thing that entails…
References:
UNITED STATES SECURITIES AND EXCHANGE COMMISSION.
https://www.yelpeconomicaverage.com/
Money vector created by pch.vector – www.freepik.com
-Business Manager & Staff Writer, Saran (Mighty) Burapchasri can be reached at saranb23@rism.ac.th. Follow his Instagram @mighty.b11
