BIT BY BIT OPENINGS WON’T JUICE ECONOMY

Across America, politicians are making up rules and doling out executive orders to resuscitate the dying economy that lack basic fundamentals relative to Main Street reality.
Vermont is allowing farmers markets to reopen for mask-wearing customers. Georgia is throwing open the doors to tattoo parlors and bowling alleys. South Carolina has permitted stores to open as long as only five people enter for every 1,000 square feet of shop space; restaurants and theaters can reopen this week. The state also is deferring to localities that might choose to keep lockdown orders in place.
But big retail chains such as Best Buy, The Gap, Macy’s, Starbuck’s, and TGI Fridays are sitting out the early stirrings of economic revival.
Best Buy is “still reviewing the orders [lifting lockdowns] but “for now we will continue operating solely with contactless curbside service across the country, including in South Carolina and Georgia,” a company statement said.
Big chains say they are slow to open up because they worry about lingering contagion and its possible impact on workers, customers, and stores’ liability should people in either group get sick. But, as we see it, it’s more about the bottom line: stores cannot make enough sales to cover their overhead costs if only a few customers are allowed to enter the store at a time.
Before reopening, the chains would have to rehire thousands of workers, many of whom would make more money collecting federal and state unemployment benefits through 31 July than they would on the job.
They also would face stiff costs of constantly cleaning stores and merchandise even though customers may not return in large numbers for months.
Slow Motion
Many of the companies say their plans to gradually reopen will be based on infection rates in local areas, their internal market analyses, and customer surveys in addition to state and local guidelines.
Theater chains AMC and Cinemark will reopen only gradually, based on the economics of each location. With blockbuster movie releases shelved indefinitely, many theaters would not be profitable showing lesser fare.
“The movie theater industry is a national one,” the National Association of Theatre Owners said in a 22 April statement. “Until the majority of markets in the U.S. are open, and major markets in particular, new wide-release movies are unlikely to be available.”
Restaurants, where people gather in close proximity to eat food prepared by strangers, will need special conditions to reopen, many analysts say.
Before turning the lights back on in its 840 stores, TGI Fridays will remove some seating to create distance between diners, install plastic partitions between tables, and require servers to be masked – although the masks will be colorful and decorative. “We don’t want it to look like an operating room,” said CEO Ray Blanchette.
TREND FORECAST: Again, business, particularly restaurants, cannot operate profitably with limited seating and social distancing restrictions. Thus, bankruptcy rates of both big and small operators that rely on customer traffic will dramatically escalate in 2020 and 2021.