This year has already proven to be a very hard year for many industries. Few have thought that so many things could go wrong in just one year, but only three months in, 2020 has managed to drastically change the world. The spread of the novel coronavirus is affecting many different industries. Everything from the tourism sector to airlines has been affected by the situation. Oil and gas have fallen, and even cryptocurrencies have been hit by the coronavirus.
The global financial sector is going through a very tough challenge, and some say that the situation is even worse than the 2008 financial crisis. Some companies might even go bankrupt this year.
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The impact of novel coronavirus on retailers
Even before the spread of the coronavirus, some experts were saying that in 2020, many retailers would go bankrupt. As the virus spread, the situation got even worse for these companies as sales went down.
One of the companies that is facing a financial crisis this year is 99 Cents Only. The crisis started as companies like Dollar General, Dollar Tree, and Walmart emerged and became popular competitors. In 2017, company representatives reported a net loss of $27.1 million. The situation was getting out of hand long before 2020, but the 35-year-old company tried to turn things around. Even though 99 Cents Only has tried a lot of things, it is heading toward bankruptcy as it continues to lose a lot of money.
There was a time when Forever 21 was one of the most popular shops around the world, but sadly, in 2019, it filed for Chapter 11 bankruptcy. With this decision, according to CEO Linda Chang, Forever 21 will be closing 350 stores around the world and stop operating in 40 countries. Although the company is still operating in the U.S., the situation is getting worse every day.
As the novel coronavirus spreads further, many airlines are canceling flights. It’s not only the airlines that are making this decision, but countries around the world are also closing their borders. A few days ago, representatives of the European Union said that for the first time in the existence of the EU, they might have to close all borders inside and outside of the EU.
This hurts airlines a lot, especially low-cost airlines that had flights almost every day inside and outside of Europe. Many officials have said that if the situation continues as it has been, most of these airlines will go bankrupt before May.
Airlines are refunding payments for the flights that have been canceled, leading to a cash crunch even without a slowdown in future sales.
As fewer people are leaving their homes, airlines are finding it difficult to sell tickets even for flights that are not canceled. More people are deciding not to fly at all, even in the most important situations.
The companies are asking governments to help them, but it is very hard to say what will happen, as the coronavirus is spreading every minute. It has infected more than 300,000 people so far.
The global tourism industry has received the most damage from the coronavirus. Many countries had to close down the most popular tourist attractions. Ski seasons have ended too early in countries like Austria and Georgia.
Tourism business representatives are saying that they are going through the toughest times. Hotels around the world are out of clients. Home businesses are also going through a very tough time as most of them were not prepared for this situation.
The fast pace of the virus' spread is the biggest problem for business representatives, as they did not have any time to come up with plans to ensure as little loss as possible.
Novel Coronavirus: Conclusion
The novel coronavirus spread from the Wuhan region of China. There are many theories about how it spread, but the only thing that matters right now is that it's growing rapidly. It has been spreading all around the world. For now, the epicenter of the virus is in Europe, where most countries are closing their borders to fight the spread of the virus.