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Monday April 13, 2020 |Notes

Accelerating the demise of traditional retail

Traditional retail was struggling and coronavirus pandemic is accelerating its demise. Commercial areas will see a huge rise in vacancies by retailers - not necessarily restaurants & service providers.

While many local businesses continue to operate; restaurants are open for takeout, repair shops are open by appointment, and coffee shops provide pickup for online orders, local retail shops sit idle. There's no activity - or need - for most local retail establishments. Most shopping can be done via online retailers, which largely continue to operate without disruption.

Physical retail space is inefficient and rarely provides a benefit over online shopping. Recently, companies like Amazon, Target, and Walmart have shown off the strength of their inventory supply chains. Even among enormous surges in demand and shifting shopping habits, these companies have been able to keep deliveries on time, while replenishing key items on a consistent basis.

It's hard to see how many of these local retail stores will stay afloat, or relevant, in the near future. As consumer habits shift to online purchasing, they become less likely to go back to an inefficient model - and accepting additional health risks.

There will be mass closures of local retailers in the coming 3-12 months and there's little reason to believe it will bounce back. Shopping is moving to digital commerce, without regression.

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