RSI COVID-19 INSIGHTS FROM AROUND THE GLOBE – New York
Ryan McCarthy, Retail Solutions, New York Retail Update – March 31
“How are things in New York City?“
I’ve been asked that question more times in the past 3 weeks than the previous 6 months. Gotham has become the new global epicenter of the COVID-19 pandemic, bringing one of the world’s most energetic, iconic cities to a screeching halt. Well, somewhat. Allow me to share what life is like in the Big Apple as we begin our fourth week of social distancing and self-quarantining.
Streets are empty. People are bored. Restaurants are closed. Lady Liberty is alone. Parks are deserted. Well, unless the weather is nice. That’s when you see groups of people at Domino park greeting each other with an elbow tap (rather than a handshake – safety first!), ultimately leading to an Instagram selfie with the caption #socialdistancing. But, I digress.
There are 8 million people crammed into the 5 boroughs of Manhattan, Brooklyn, Queens, Bronx and Staten Island that make up NYC. We’re approaching 40,000 Coronavirus cases, and according to most statistical models, that number will grow significantly. Measures have been in place for several weeks now to flatten the curve, including a mandate for all non-essential workers to stay home. So, how has that impacted the city and its businesses? Let’s have a look.
New York City has over 220,000 companies, and nearly 90% of them have less than 20 employees. Small businesses are the lifeblood of the city. Restaurants, boutique hotels, breweries, tech start-ups – if you can think of it, NYC has it. Each of these businesses has felt the impact of the government mandate. Cafes, fitness clubs, department stores and barbershops are all closed. However, like many other places in the world, businesses are adapting. You can’t dine in a cafe, but you can get delivery or take-out. You can’t go into a fitness club, but you can do a workout with your favorite instructor on Instagram Live. You can’t go into a department store, but you can order from their website. No such luck for barbershops though. Unfortunately, I can speak from first-hand experience on that one.
While most NYC businesses cope with the new normal for the foreseeable future, there is one industry sector that is thriving: grocery and drug retail.
You don’t have to walk too far to pass one of the 10,000 bodegas, 250 Duane Reade stores, or any one of the many Whole Foods, Trader Joe’s, Wegmans, or Targets. These all qualify as essential businesses, so they can stay open. And they’re effectively the only places you can go if you dare leave the confines of your NYC apartment.
How have the stores changed over the past several weeks? I’m glad you asked.
When this all kicked off a few weeks ago, the shelves were a bloody nightmare. They were emptier than a Miami Marlins baseball game in mid-July. If you wanted pasta, bread, meat, paper products, canned vegetables, or anything with the word “anti-bacterial” on it, you were up a creek without a paddle. Gone. All of it. The trucks kept coming, but not at the pace of demand.
Thankfully, that was then, and this now. The supply chain, logistics, and store operations teams are working harder and smarter than ever before to keep up with demand, and it’s paying off for consumers as the shelves are in much better condition. Three weeks ago, I was lucky if 30% of the items on my list were in stock; now, I’m up to about 75%, which is consistent with what we are seeing in the retail data across the world. It will be quite a while before the shelf carnage gets fully repaired and product on-shelf availability is back in the 90%+ range. Retailers, CPGs, and their technology partners have a long road ahead to correct the problems rooted in phantom inventory, distribution voids, and non-compliant planograms.
In addition to the shelves, there are other notable differences between then and now.
- No more crowded stores. Go to any local Whole Foods or Urban Market, and you will see a sign on the door that states: Max of 50 people allowed in the store. My local Whole Foods is 50,000 square feet in size, just for perspective. There are security guards managing the inflow and outflow of customers to ensure compliance.
- Space it out. When you get in the queue to pay, be prepared to stand 6 feet behind the person in front of you. If you don’t know how far 6 feet is, just look down. Duane Reade has put blue strips of tape on the floor 6 feet apart. Even the local bank branches are using “Please Stand Here” signs to maintain the social distancing.
- Shelf merchandising is back. The store employees are back to stocking the shelves in a civilized manner, compared to the “drop the pallet in the middle of the aisle and let customers rip it apart” approach that some were doing.
- When to shop. The after-work rush and crowded weekends are gone. The distribution of shoppers has normalized across the days and times now that people are quarantined at home. Your local grocery store is just as likely to be busy at 2:00pm on a Tuesday as it is at 10:00am on a Saturday.
- Essential items – no change. This includes hand sanitizer, toilet paper, disinfectant wipes, and several other items that have been difficult to find at any point in the past 3 weeks. But top tip for anyone living in NYC: go to a bodega. Many of them are stocked with not just these items, but the full range. And it will feel good to support the local community.
What’s next for New Yorkers?
It appears to be more of the same for the foreseeable future. We understand that we need to trust the data and the science, do whatever is necessary to ease the burden on our healthcare system and minimize the spread of the virus. This global pandemic will eventually end, and when it does, the soul of New York City will be restored by bringing its people back together in restaurants, bars, museums, parks and landmarks. The people of New York are some of the most resilient people on the planet. Tragedy and adversity seem to bring out the best in New Yorkers, creating an authentic sense of community and compassion amongst one another. And, of course, using humor to get through even the most difficult of times.
I would be remiss if I didn’t stop to give praise to the grocery and drug store workers, delivery drivers, warehouse employees, and everyone else making personal sacrifices to keep food on the table and ensure that we have the essential supplies needed to stop spreading the virus. They are willingly putting themselves at risk every day by leaving the safety of their homes to go into work. All to help us survive this pandemic. If any of you are out there reading this – thank you. Lastly, an even greater thanks to all the healthcare employees and volunteers on the front-line helping care for those affected by the virus.