SES Readers Share Impact of Coronavirus on Their Businesses
We have heard from readers in different parts of the world about how the coronavirus crisis is impacting their business.
Here is a sampling of their stories.
Joel Rawlins, Owner, Beercan Boards, Douglas, Georgia
COVID-19 has had a significant impact on our operations. Several of our suppliers are based in states that have shelter-in-place orders, so it has been a bit tricky to get certain items. That being said, we are still shipping every single day.
The state of Georgia reached out to us through a manufacturers’ association and asked for help producing product that could assist in the coronavirus fight. So we have developed a medical cart for use when converting spaces into temporary hospitals or outdoor testing areas. We are now in production of about 25 to 50 a week.
Although many businesses are closing right now, and our bigger customers such as Vans and Ron Jon Surf Shop have postponed their orders, we have been overwhelmed by our fans steadily interacting with us via Instagram and ordering from us directly through our website. We are so glad that we can still give our customers the product they love while diversifying into a much different sector that can help with the pandemic in some way.
We were lucky and received our PPP money from a small local bank after being disappointed by one of the big banks. The money will help us to continue doing business with our regular customers and put even more effort into manufacturing of our medical carts.
Bryan Dickerson, Publisher/Editor-in-chief, WavePoolMag, Hasparren, France
Like all the other digital media outlets, business has been tough. Our two major advertisers put everything on hold and our investor has hit the pause button as well. So, no income until the economy starts moving again. We are fortunate because we use a freelance network to create content and manage the site, so we didn’t have to lay anyone off. We have just hit the pause button until the economy starts moving again.
We have not applied for the PPP program, because we are based in France. The French government is depositing money into the accounts of small businesses based on the previous year’s income. So from my limited view, the system is working over here to get money to people, even independents who aren’t French citizens but pay into the system.
Santiago Patron Costas, Managing Partner & Co Founder, GTM Agency, Buenos Aires, Argentina
We founded GTM to help action sports and outdoor brands develop their business in Latin America. We help brands manage their relationships with their distributors and licensees.
Most Latin American countries are facing mandatory quarantines which are now extended for more than a month. While trying to manage the situation from a health perspective, there is also lots of worry in the economic situation.
Most Latin American companies are not receiving enough protection programs from their governments mainly because we have poorer nations with delicate fiscal balances.
Tourism, entertainment and fashion are going to be some of the most damaged industries. Wholesale retailers with closed stores and insufficient e-commerce sales will struggle to pay distributors in the region. If distributors have their own monobrand retail stores, they will not be able to generate enough cash with stores closed while still paying salaries. Furloughs without paying salaries is illegal in most Latin American countries. It´s too early to know how this situation is going to end.
People will likely default on payments, some companies will go out of business, and there will be lots of inventory in the market. This will lead distributors to cancel orders with brand headquarters and probably skip seasons.
Derek Sciacqua, President/Owner, Gecko Hawaii, Honolulu, HI and Vista, Calif.
Our wholesale orders have been cancelled almost entirely due to the COVID-19 shut down. We are continuing to ship online retailers and our own online business is up 245% from last year. The online sales are great but they do not come close to the volume we were doing with our wholesale channel.
Some of the orders that we managed to ship before the shutdown remain as open invoices. Stores have requested 90-day dating on top of their 30-day terms. We have granted these requests as we are all in this together.
We are taking this down time to develop new products. We are currently working on masks as this will be a necessary item for the foreseeable future.
We applied for the Paycheck Protection Program, and we are fortunate because our loan came through. We plan to reopen our Hawaii facility with all of our original employees as soon as we are able to.
Our mainland facility in San Diego remains open with a skeleton crew to ship e-commerce orders and develop new product.
We hope everyone stays safe – we will get through this together.
Nick Humphreys, Underground Skate & Surf, Orewa Beach, Auckland, New Zealand
We are still only one store but it is one of the strongest independent skate/surf stores in New Zealand. We have a store online and a solid following.
In New Zealand, the government announced a FULL lockdown at 2pm Monday, March 23 effective midnight Wednesday, March 25. We were not even allowed to trade online or ship products. You are not even allowed to swim, boat, surf, SUP or drive unless going to a supermarket or you are an essential worker.
We reacted quickly. Within two minutes of the words ‘lockdown’ getting mentioned that Monday afternoon we were in emergency mode. We needed cash and cash FAST! We dropped everything 20-40% off online for a 36-hour snap sale turning our store into click and collect only and promoting our free same-day local delivery service.
The quick actions worked well because we beat our competitors and big retailers in the cash chase. This gave us enough cash flow to pay the staff and have a runway on our main business expenses for five to six weeks. Later that week the government paid out a wage subsidy that covers around 70% of our wage bills.
Given the crisis, I knew we needed to pivot and create something that is relevant.
So I called a team Zoom meeting. We need to change our mindset from defensive and reactive to positive and proactive. The questions we pondered: What do we have? What can we offer the community? What are our values? What can we do to create so much brand loyalty people would rather buy from us in a few weeks rather than have their needs met by some retailer from another country?
We created a campaign called #supportcoasties. The focus of this to give local business with no online platform a way to sell vouchers that help them create income that will help them reopen. This is entirely non-profit with all proceeds going to the various businesses. As a result, we have seen HUGE support for not only these businesses but also our business. In the first day, for example, the community bought $340 worth of vouchers for a small café, which gave the café owner hope.
Our local business association has used our idea and website after looking at more generic options. It has bonded our team with an immense feeling of pride. Our online sales have skyrocketed, people are buying vouchers and people who were planning on buying a new surfboard after lockdown are calling me and saying “I want to pay for this now to help you out.”
There are many small stores around the world with a strong local reach that could replicate this model in these hard times.
Editor’s note: To share your story with SES, reach out to us here.