New York City’s Shops Cautiously Reopen After Months on Lockdown
(Bloomberg) -- Editor’s Note: No city is more important to America's economy than New York, and none has been hit harder by the coronavirus. “NYC Reopens” examines life in the capital of capitalism as the city takes its first halting steps toward a new normal.
Macy’s, the quintessential New York store, isn’t opening. Nor is the Gap. But come Monday, Mackenzi Farquer will absolutely be selling her merchandise—in person, at her boutiques in Queens and Brooklyn—for the first time in more than two months.
It won’t be the same, of course. Only curbside pickup is allowed in this first phase of New York’s Covid-19 reopening, but Farquer is prepared. Her five stores, called Lockwood, are for people who enjoy browsing, selling items like coffee mugs that say “Social Distancing Club,” Star Trek jigsaw puzzles and vanilla-scented erasers.
So she had her visual merchandiser set up a curbside display that will allow shoppers to simulate Lockwood’s serendipitous shopping experience just a bit, with alcohol hand sprays and masks mixed in.
“I'm hoping that when people come to do curbside, it feels for a brief moment like shopping,” said Farquer, 41.
For New York’s small businesses, which depend almost entirely on city residents, Monday marks a vital moment to start bringing in the customers and revenue they lost during the shutdown — an undertaking all the more precarious with the current social unrest. Farquer’s Lockwood survived by selling merchandise through her website and getting four of her five landlords to cut rent by as much as 40% for the summer. Nearly 90% of small businesses have seen a large or moderate negative effect from the pandemic, according to the U.S. Census Bureau.
Yet even as small shops scramble to get back to business and earn some money for the families that own them, major retail chains aren’t rushing to restart. Macy’s will not yet reopen its Herald Square flagship, one of the world’s largest department stores. Tiffany & Co. will wait at least another few days before considering serving shoppers at its Fifth Avenue shop. Coach, Kate Spade and Stuart Weitzman fashion boutiques will stay closed, as will New Balance shoe stores and Zales jewelry locations. Ulta Beauty hasn’t yet set a timeline for its return to the city. One that does plan to open is the Container Store, which will offer pickup for online and phone orders.
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These big chains have hundreds of stores across the U.S. that have reopened in recent weeks and robust e-commerce operations fueled by vast international supply chains and distribution channels, so business elsewhere can prop up their stores in New York. Local shops didn’t have any of those benefits.
“Small businesses are typically managed by their founders and owners,” said Mark Cohen, director of retail studies at the Columbia Business School. “A small business owner has a rent bill due, merchandise they've taken in that they haven't paid for and employees they feel honor-bound to re-employ. So there's probably a different motive component to small businesses reopening.”
That’s certainly the case with Christine Alcalay, a fashion designer who owns two boutiques in Brooklyn called Kiwi and Fig. She’s kept her stores afloat by revamping the company’s e-commerce to make it easier to shop, but sales are still down about 80% from a year ago. She furloughed all but one of her 10 employees when the pandemic hit.
That left her delivering online orders, answering customer e-mails and texts, while securing a loan from the Small Business Administration, which allowed her to start paying her staff again. She also made Instagram videos, in which she not only modeled clothes, but also talked about her struggles as a business owner.
Now she’s hoping that the first phase of reopening New York’s retail industry would at least get residents comfortable with shopping again.
“I think psychologically it will get people to shop a little more because it’s official,” said Alcalay, who has been in business for 18 years.
Alcalay initially planned to make a marketing push for the reopening, but scaled it back because of the protests over police brutality. “It doesn’t feel like the right time to be pushing merchandise with what’s going on right now,” she said. Still, she planned to fix up the front of the stores for when people pick up orders. And she already had a local artist paint pickup hours and website addresses on the windows.
“I think we are going to make it through this,” Alcalay said. “But I’m worried about the next year or two.”
Lockwood’s Farquer is locked in on the calendar, too—New York Governor Andrew Cuomo’s next phase of reopening, when she’ll be able to open her doors to the public again.
"At some point you have to keep the business going,” she said. If limited retail is allowed by July, "for a lot of us it's going to come just in the nick of time.”
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