The retail apocalypse has been plaguing retailers for years since the online shopping craze hit. Major retailers such as Sears, JC Penney have been hurting for years. Fast forward to the pandemic and the anchor stores of the local mall are no longer the only ones in peril. Shelter in place orders and online shopping is killing the entire mall. Currently, the Roseville Galleria has 16,000 square feet of vacant retail space due to shops that just can’t survive.
Social Distancing and Shut Downs
Retail stores aren’t the only ones taking a hit. Restaurants, bars, gyms, and salons are barely hanging on with current social distancing and shut down mandates in place. The restaurants and bars that are able to adapt to the new protocols are reopening at drastically lower capacities with comparable expenses. In addition, the instability of knowing when restaurants can re-open led to a tremendous amount of perishable food waste for businesses that needed to suddenly re-stock in order to open their doors.
Closings
According to Yelp, over 66,000 businesses have closed their doors permanently since March 1st. Researchers at Harvard believe that may be only half of the small businesses that we can expect to close before this pandemic is over. Because small businesses rely so heavily on foot traffic and operate on small margins it is easy to see how shutdown orders have destroyed so many mom and pop shops.
Small business loans were made available; however, owners were so weary of their ability to repay the loans when they came due, over $130 billion dollars of the available loans weren’t taken.
Owners of small businesses that are closing likely have many questions about what will happen with their business’ debts as well as potentially personally guaranteed debts that may loom after the business is closed.
For more information, contact your Stockton bankruptcy attorney at 209-952-0355.