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San Antonio retailers worry, prepare for slowdown

Xochitl Duran of New York works on a knitting project last week at the Pearl, where many restaurants and shops are turning to pickup and delivery services amid the pandemic.

Karolina’s Antiques, a store on Blanco Road that sells vintage merchandise and an assortment of Fiesta flair, is usually bustling on Saturdays.

But far fewer customers came in last weekend, dealing another blow to the business after officials pushed back Fiesta to November because of the coronavirus pandemic.

As he prepared to reopen the store Monday, Uriel Diaz felt scared. Diaz runs the business with his brother, Anthony Diaz, and mother, Maria Vega. The store is his family’s sole means of income.

“This is our livelihood,” he said. “We can’t stay home. We don’t have backups or time off. If we can’t have our doors open, it’s terrifying.”

Employees offer hand sanitizer to customers, Diaz said, and mop and disinfect the store. The owners are also looking at providing free shipping for orders over a certain amount.

As the fallout from the coronavirus ripples through the economy, retailers of all sizes are facing a murky future. A slew of national chains are shuttering stores. And malls, already struggling with dwindling foot traffic, are limiting hours.

“It’s a bit of a nightmare for anyone who’s not a dollar store, discount store or grocery store,” retail consultant Jan Kniffen said. “Nobody’s hoarding sweaters, shoes or jewelry.”

In the coming weeks and months, some retailers will have difficulty refilling inventory, and those with complex networks of suppliers will take longer to bounce back, according to a report by real estate firm JLL. Travel restrictions will result in a drop in spending.

“Depending on government advisories in the following weeks, consumers are likely to remain cautious and will limit consumption and reduce eating and shopping trips,” the firm noted in the report. “This will be more extreme if people are placed on lockdown or are quarantined. As a result, online shopping is likely to see an uptick as people avoid heavily trafficked public areas.”

Texas executives expressed uncertainty over the coronavirus in a February survey by the Federal Reserve Bank of Dallas. The retail sales index fell from 4.8 to -2.5, and the company outlook index plummeted to a six-month low.

Small retailers are under pressure because they generally lack the cash reserves and wider margins that large companies maintain.

To keep afloat, business owners are offering pickup and delivery services and using social media to tout gift cards and stay connected to fans of their wares.

“Curbside pickup is going to be the new trend for a while,” said Joe DeCola, vice president of retail at NAI Partners, a Texas real estate firm with offices in San Antonio, Austin and Houston.

Businesses are doing a good job of “controlling the hysteria” by putting limits on certain products and the number of people in stores, he said. The big question is how those who depend on goods from China will fare.

“Those may be hit the hardest,” DeCola said.

Another potential threat: Consumers are expected to turn to the internet for their shopping fix even more than they did before the coronavirus outbreak — which could hurt small retailers without snazzy, “robust” websites.

Small and midsize retailers that cater to tourists also will likely feel squeezed, said Jonathan Haag, a senior associate at JLL, a Chicago-based commercial real estate firm.

“Shifting hours of operation, offering employees the opportunity to work remotely, reducing scheduled hours or eliminating positions all together are among the short- and long-term options available for these businesses to maintain some sense of normalcy,” he said.

At the Pearl, many restaurants and shops are offering pickup and delivery services, said chief marketing officer Elizabeth Fauerso.

Programming has been suspended, and the Pearl will buy all the produce from Farmers Market vendors and donate it to the San Antonio Food Bank. A program allowing customers to order from Farmers Market businesses online and pick up the goods at the Pearl Stable is in the works.

“Everybody’s inventing in real time how to do this,” Fauerso said.

Local boutique Feliz Modern, which has a store at 110 W. Olmos Dr. and a pop-up shop at the Pearl, closed both locations this week.

Owner Ginger Diaz started thinking about reducing store hours last weekend. She said some employees live with elderly family members, a population at greater risk of COVID-19, and the management team eventually decided to shut down temporarily.

“It’s really important we slow this curve,” Diaz said. “We can always make money later. We don’t want to see this become a bigger health crisis.”

Customers can still order online. Also, Feliz Modern is offering curbside pickup and free shipping for orders over $25.

“We’re hoping that helps keep us afloat,” she said.

Marla Ross, who owns Adelante Boutique at the Pearl, closed Sunday to give employees time to process the crush of coronavirus-related developments. On Monday, she hung a sign on the shop’s door asking visitors to knock as a way to limit the number of customers in the store.

“It’s very possible we’ll lock our doors,” Ross said. “It feels like there’s so much denial as to what’s going on. We need to concentrate on saving everyone’s lives.”

In the meantime, Ross is trying to put the boutique’s goods up for sale online and giving customers the option to pick up orders or have them shipped.

“It’s daunting,” she said, but the bigger concern is what happens two months from now.

“Am I going to have an empty store come summer because there are no goods?” she said.

madison.iszler@express-news.net

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