COVID-19 winner and losers - Online stores emerge victorious while local shops suffer.

 

 

The COVID-19 pandemic has greatly impacted the world’s economy. People can no longer move as freely as they wished because of the rules that were enforced in order to stop the propagation of the virus. A lockdown situation means not being able to go shopping with your friends for new clothes or go to the electronics store to buy a new smartphone. This situation brought some change in consumer habits and It also created controversy in countries such as France or Italy. All in all, people as well as retailers had to adapt to this era. This pandemic is everybody’s struggle, and not everyone is equal when it comes to their chances of survival when we speak about business.

 

Local stores and local retailers are desperately trying to survive this crisis

When a lockdown is declared, the first victims are obviously the local retailers in your town. Many shop owners have been heavily impacted by these measures to prevent the spread of the coronavirus. If we take the example of France, many shops that are not considered ‘’essential’’ like bookstores, toy shops or flower shops are forced to close during lockdown. In France, while the first lockdown in March may have cause considerable damage to these local shops, there is a high chance that the second lockdown that is currently happening might bring a lot of shop owners to their knees, leading them to bankruptcy. The fact that local stores are forced to close during lockdown has sparked debate all over the country. Many people disagreed with the government's choice, especially when bookstores were forced to close down and when books could still be found in grocery stores such as Carrefour or Auchan. Many people denounced this as unfair competition and as a stupid decision, the main argument being that books were as essential as any other form of entertainment, if not more considering the fact that people are less and less cultivated and that the ability to read and write is getting worse with each generation. In response to the government’s decision some shops have decided to stay open during lockdown even if they might end up getting fined. Several shops even received support from their town’s Mayor.  

 

Online retailers are the great winners in this pandemic

 

Despite all the decisions that make like difficult for local shops, the real threat is online. Although there are some people who deeply wish to help their local stores, the big majority of consumers will just find another way to shop. The easiest one is the internet. Online retailers are the least impacted by this pandemic, and even if at first it seemed like they were going to suffer as much as any other businesses, it is far from being the case. Stores like Fnac, Cdiscount, Rakuten have been working tirelessly to keep up with the skyrocketing demand influenced by COVID-19. Shopping without going out of one’s home has never been easier. Everything can be found online, from books, to flowers. People can either choose a delivery at home or they can retrieve their order at pickup points or even in some physical stores that stayed open. That is the case for the majority of Fnac stores in France, as the goods that are sold in stores such as refrigerators or computers are considered ‘’essential’. However, the biggest winner here is obviously Amazon, which has seen its profit double during the second quarter of 2020. Due to the coronavirus pandemic, Amazon has made $5.2 billion during Q2 of 2020 compared to $2.6 billion in 2019 at the same period. In 2020, consumers have adapted quickly to the pandemic and buying online is without a doubt the preferred way of shopping. If they want to survive, local shop owners have no choice but to go online as well. They will however have to follow the strict policies of Amazon’s marketplace by giving a commission to each item sold. Whatever they choose to do, local shop owners are far from being safe.

Vincent L. 

Sources : 

Time, 2020,  'How the Coronavirus helped grow Amazon's profits and power' [online]

https://time.com/5870826/amazon-coronavirus-jeff-bezos-congress/

The Verge, 2020,  'Amazon doubled its profit during a pandemic' [online]

https://www.theverge.com/2020/7/30/21348368/amazon-q2-2020-earnings-covid-19-coronavirus-jeff-bezos

Financial Times, 2020,  'Amazon doubles quarterly profit despite Covid-19 costs' [online]

https://www.ft.com/content/7a42b1d8-9ca7-4827-aaae-729fdb7637f5

Actualitte, 2020, 'Les Fnac ouvertes, quand les librairies ferment: l'incompréhension règne' [online]

https://actualitte.com/article/monde-edition/les-fnac-ouvertes-quand-les-librairies-ferment-l-incomprehension-regne/103511