I'm trying to figure out just how damaging the coronavirus outbreak will be to business.
On one hand, I've got examples of past "panics" or Black Swan events where business dropped off radically--such as the invasion of Kuwait. (Ironically, 9/11 wasn't as bad, maybe because Bush urged people to spend money as a patriotic duty...)
On the other hand, I know that most people don't think THEY'LL be the ones who get sick.
But I'm pretty sure this is different, because it's an epidemic, because of the scary news.
Seems most likely to me that people will hunker down, that they'll just stay home. Since my business is so dependent on tourism, that could mean a major hit during Spring Break, which isn't far away. So perhaps the prudent thing to do is to stop buying stuff now.
It doesn't matter how good your inventory is if people aren't coming in.
But if I cut too much, I'll guarantee that there will be a downturn in business.
The answer, of course, it to moderate my spending. I've been very aggressive buying books, trying new titles, expanding categories. Which seems like the right thing to do when books sales are increasing by 125%. But I can moderate this to simply replacing the best-sellers and ordering the best new sellers. Not as satisfying, but does the job.
Same with games and graphic novels. Keep the store well stocked, but stop experimenting.
Of course, if the shit really hits the fan, no amount of cutting costs will cover the shortfall. But then, we'll all be in the same boat. Allowances will need to be made by landlords and suppliers.
Ironically, it's the first time I can see a negative to being in a high rent district. I've always maintained that moving away from a high-rent district is a mistake because the loss in foot traffic will be far more severe than the money you save on cheaper rent. For the first time, I can see how having a low rent might be an advantage during emergencies.
Then again, living for emergencies is a pretty stupid way to live. Yes, they come along, but if you live your life in fear of Black Swans, you may as well stay home.
2 weeks ago