Top Stories of 2020
The year started normally enough, but the COVID-19 global pandemic drastically changed that for everyone, including retailers. Here’s a look back at our sector’s ups and downs during challenging times.
A Holiday Puzzle
Stay-at-home orders to quell the pandemic’s spread led to a boom in sales of jigsaw puzzles. That’s appropriate, as the National Retail Federation (NRF; Washington, D.C.) likens the task of predicting this year’s holiday sales to assembling such a puzzle without all the pieces. “Completing a puzzle is highly probable, given patience, having all the pieces and having the picture on the box to guide assembly,” said NRF Chief Economist Jack Kleinhenz. “But it’s not the same when attempting to fit pieces of the economy together in today’s environment. Many of the pieces are missing.” Among the unknowns are policy surprises at the federal level and a resurgent virus, Kleinhenz said.
Cannabis Retail on a High
Yet another jigsaw puzzle is a map of the U.S. showing where retail marijuana sales are legal. Currently, 34 states allow some form of recreational and/or medicinal sales, the National Organization for the Reform of Marijuana Laws (NORML; Washington, D.C.) reports, with several more in the pipeline. There was a divide within this sector when it came to getting designated as an “essential business” during the pandemic shutdowns; medical dispensaries got that label, but recreational stores did not. And even though all businesses in this category are tightly regulated, operators are being increasingly creative with their stores’ interiors. (A fab example of that appeared on pages 24-25 of VMSD’s July/August 2020 edition, which profiled the Grass Monkey’s first bricks-and-mortar locale, in Portland, Maine, that doubles as an art gallery and features an eclectic aesthetic with bespoke art, graffiti and biophilic moments.)
Word of the Year (Hint: it starts with a “P”)
A Silicon Valley buzzword of the early 2010s found a second life as the pandemic spread, as businesses began to “pivot” in the face of the new market realities and demands. Example: in March, retail conglomerate LVMH (Paris), owner of Christian Dior, Guerlain and Givenchy scents, said it would convert three of its factories to produce hand sanitizer. Not surprisingly, within a few months, the word’s widespread use led to pivot fatigue. As Columbus, Ohio-based WD Partners’ Lee Peterson (also a member of the VMSD Editorial Advisory Board) put it: “Can we all make a promise to each other, as intelligent business people, to stop using the word ‘pivot’ … please?”
Furloughs ’R’ Us
As mentioned earlier, another phrase with major implications for retailers: being designated an “essential” business. Not getting placed in that category by the federal government meant a variety of specialty retailers – most notably apparel stores – had to close for a while. One such company was TJX Cos. (Framingham, Mass.), which temporarily closed 3300 of its T.J. Maxx, HomeGoods, HomeSense and Marshalls locations in the U.S. Such moves at a variety of retailers led to layoffs/furloughs, and once it became clear the pandemic was not going away anytime soon, some of those temporary cuts became permanent.
As if the mandated closings by government fiat weren’t troubling enough, stores also found themselves the targets of property damage when some protests over the late May killing of George Floyd at the hands of Minneapolis police turned violent and led to social unrest and looting. Minneapolis and neighboring St. Paul were among the hardest-hit by such problems, registering damage at 207 stores in all, according to the Star Tribune newspaper. Similar problems also happened coast-to-coast, including New York, Washington, D.C., Louisville, Ky., Denver, Seattle, Los Angeles and Peoria, Ill. Despite that, The New York Times said most retailers impacted by the violence “largely sought to convey empathy for protesters … and did not condemn the damage to their businesses.”
Rumor Has It (Right, In This Case)
Talk about tough timing: the huge Hudson Yards development in New York – which includes about 100 shops and restaurants – officially opened on March 15, 2019. Almost a year to the day later, most of the 1 million-square-foot retail center temporarily closed as the pandemic slammed the city. And while most Hudson Yards stores have reopened, the long-awaited Neiman Marcus (Dallas) there did not. First came the luxury retailer’s filing for Chapter 11 bankruptcy protection in May. Then, following weeks of rumors in retail circles that the New York store would not reopen, the chain confirmed just that in a court filing in late July. (In addition to its other New York location, Neiman Marcus said it is closing two stores in Florida and another in Bellevue, Wash., leaving the brand with about 40 doors.)
Like their counterparts in the healthcare sector and other “essential businesses,” many retail workers – especially those employed by grocers – received “hero pay” (i.e., bonuses) for staying on the job during the uncertain early days of the pandemic. In fact, the can-do attitude of frontline store employees earned them a collective nod as this year’s “VMSD/Peter Glen Retailer of the Year” by its Editorial Advisory Board. (See the September 2020 issue of VMSD, p. 18-20.) Meantime, retailers such as Gap Inc. (San Francisco), Patagonia (Ventura, Calif.) and Walmart (Bentonville, Ark.) joined about 400 other U.S companies participating in the nonpartisan Time to Vote coalition to encourage workers to cast ballots in the 2020 U.S. presidential election. To help get out the vote, participating companies took such steps as giving employees paid time off on Election Day, providing access to and information about early voting or vote-by-mail options, or making Nov. 3 a day without meetings.
Two tech giants continued to build their retail presence. Apple (Cupertino, Calif.) opened what it termed its “most ambitious retail project” yet: a wow-inducing domed store that sits on the waters of Singapore’s Marina Bay and offers 360-degree views of the city’s skyline. (The sphere is comprised of 114 pieces of glass with only 10 narrow vertical mullions for structural connection.) Meanwhile, e-commerce giant Amazon (Seattle) built on its 2017 purchase of Whole Foods by debuting two food-retail prototypes: Amazon Go Grocery, a 10,000-square-foot market offering cashierless checkout and a curated line of food offerings, and the 35,000-square-foot Amazon Fresh brand, a full-service grocery also with cashier-less checkout.
Given all of the above, as this vexing, tumultuous year draws to a close, most people will likely say “good riddance” rather than “fond farewell” to 2020. But retailers and their workers can also hold their heads up: They didn’t panic in the face of a pandemic.
Illustrations by Don Heyl, Cincinnati
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