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One of the pandemic’s many lasting effects is shifting people’s shopping patterns to be much more online, causing the local economy to lose ground quickly to giants like Amazon. However, in person shopping has been on the decline for years. The retail apocalypse began in 2010, and since then major names have completely gone out of business, among them Toys R Us, Gymboree, Borders, and Blockbuster. This pain is felt personally by the storeowners Sillable is working with, with one telling us that it’s very difficult to complete with the prices found on major online retailers, whose clothing is manufactured in overseas factories.
With the rise of online giants like eBay and Amazon and AliBaba, the fate of brick and mortar retail seemed sealed years ago. The convenience and effortlessness of online shopping coupled with faster and less expensive shipping has made the message clear, online is king. But the real blow to in-person shopping came during the COVID-19 pandemic. By the end of 2020, 8,300 retail stores had confirmed they were going to close according to an analysis by Business Insider.
Macy’s has closed 125 retail centers in 2020 and announced the closure of an additional 7 stores for 2022. A particular blow was dealt to Chicago’s Michigan Avenue with Macy’s leaving its historic Water Tower place residence. The rest of Magnificent Mile has lost a large volume of in person shoppers as hundreds of local shops closed down during the pandemic. A survey of 5,800 U.S. based small businesses found that 43% of them anticipated closure for the end of 2020. These closures highlight the COVID-19 pandemic’s effect on local shopping and its role in accelerating the retail apocalypse.
However, we at Sillable care much less about Macy’s and more about the pandemic’s effects on the local, independent retailers (see our deep-dive into the retailers’ perspective in our next post). These retailers don’t just provide cheap, convenient items. They curate a unique experience. Many stores are like treasure troves that reflect the owner’s personal tastes and the love for what they sell. Much of a city’s community and culture thus depends on the local economy.
The surge in online shopping, especially during and after the pandemic, has crippled local economies.
This figure from a Polish study shows that although the number of in-person transactions had been on the decline for a while, the pandemic effects on local economy are undeniable. Notably, the red bars indicate a sharp decrease emphasizing the pandemic effects on local shopping . This reflects how local economies suffered from a sudden loss of income from the lack of local revenue.
As our world is modernized, the shopping experience must continue adapting. Sillable is here to reinvigorate the local shopping experience. We build virtual storefronts and offer all the best perks of online shopping like same-day delivery. We’re confident that equipping brick-and-mortar stores with the tools to reach a much wider audience will let them focus on what they do best: bringing joy to their customers.