To understand recovery, it requires a look back to a very different time one year ago. As an industry that has experienced significant transformation for years, the onset of the COVID-19 pandemic accelerated even greater changes. Retailers have historically been on the front lines of emergency response and that was certainly the case with the pandemic. Essential retailers were forced to deal with impacts on supply chains and the rapidly changing consumer demands as the entire world adjusted to a digital-first approach to shopping.
While many retailers were adapting to new in-store capacity limits and the quickly ever-changing safety protocols they also had to navigate the changes that came with shifting to an online business model.
The ups and downs of COVID infection rates impacted consumer confidence as shoppers adapted their habits from week to week. When cases when up in Washington state retail sales saw an associated drop the following month. This shift in confidence extended Cyber Week into Cyber month – a trend that may be here to stay.
Recovery has also looked different based on sector. Grocery, home improvement, electronic, and general merchandise, for instance, many with strong online platforms did very well over the past year. But other non-grocery small retailers struggled using PPP and EIDYL loans to simply stay afloat.
The gap between large and small and essential/non-essential has set a very uneven stage for recovery.
But with all the challenge has come opportunity and the industry in many respects has fared quite well. Nationally retail sales grew by a healthy 6.7% in 2020. In Washington, forecast revenues came in much higher than expected and retail trade increased 6.2% in February year-over-year.
The recent US Census small biz survey showed signs of optimism in Washington State with more than 50% of small business owners indicating they are now back to pre-covid levels or will be in the next 6 months.
Full recovery however will hinge on getting our businesses and economy opened back up. The state is one of the few in the country that lacks a plan for full reopening. It is a rare business that can flourish indefinitely in an environment of sustained uncertainty. Although the timeline for virus containment is uncertain the path forward as Washingtonians become vaccinated and hospitalizations and deaths decline – should be clearly defined.