Nearly half of California Wine Country businesses closed in the coronavirus pandemic won’t reopen, says Yelp
The global pandemic has set the table for a disastrous exodus of businesses, a new study conducted by Yelp’s online data service reveals.
Based on the number of business owners who checked “closed” on their Yelp pages, about 3,000 San Francisco Bay Area businesses closed permanently from March 1 to July 10 as a result of the government shelter-in-place orders during the coronavirus pandemic. Of those, 239 were located in the Napa and Santa Rosa areas, the only two metropolitan areas the company separated out for the North Bay.
All together in Napa and Sonoma counties, 488 closed temporarily or permanently because of the shelter orders.
And a number of stakeholders are concerned that the number of permanent closures could grow substantially. Granted, not all businesses are signed up for Yelp accounts.
“I know there’s some small businesses that couldn’t weather the storm. It’s been hard to keep their doors open, with many having to pivot to other things,” Napa Chamber of Commerce Travis Stanley told the Business Journal. “In a sense, it’s inevitable what’s happened, but most are preventing it the best way they can.”
The fight is far reaching in the Golden State.
The San Francisco-Oakland-Hayward metro area experienced 5,048 total business closures during the pandemic, with 2,065 labeled permanently, according to Yelp.
The Silicon Valley’s San Jose-Sunnyvale-Santa Clara metro area endured 1,697 closures, with 627 marked as shuttering for good.
The Sacramento-Roseville-Arden-Arcade area didn’t fare much better, having taken on 1,511 closures, with 796 not coming back.
As it turns out, California gained the most combined permanent and temporary business closures of all the states in the nation with 29,351 shuttering.
Closures were vetted by a User Ops team, which investigated the nature of the closure, according to the public relations staff. The process may involve checking the business website or finding a note from the owner declaring a permanent closure.
Retail businesses suffered some of the largest closures – temporary or permanent – with many being forced to close at least temporarily because of shelter-in-place orderes. Some, like book stores, were able to shift to curbside pickup or online ordering. Still, according to Yelp’s economic findings, retail sustained the second highest closure rates with 26,119 businesses shuttering statewide, of which 12,454 were considered permanent.
The beauty/personal care services industry followed behind with 4,897 business closures becoming permanent from the 13,609 that locked their doors during shelter-in-place orders.
But no other industry may has faced the music like the restaurant business.
As of July 10, Yelp singled out 26,160 U.S. restaurants have closed — and 15,770 are gone for good. About 10% emerged in about a one-month period starting from June 15.
“One data point I’ve seen that makes my jaw drop is that of the 1.4 million employees in the restaurant industry, 900,000 to a million have been furloughed or laid off,” California Restaurant Association spokeswoman Sharokina Shams told the Business Journal. The results represent a combination of California Employment Development Department and National Restaurant Association data.
The state advocacy organization made its own ominous prediction that at least 30% of restaurant closures will remain permanent, and “others will barely be hanging on,” Shams said.
“What we’re finding is that when you talk to people about going out, they’re still nervous,” she said. “What we were hoping to see by now is more relief from the federal and state governments.”
Despite the pandemic crisis dragging on for months and creating wreckage in its path, most business watchers agree the damage seen so far only represents the tip of the iceberg in terms of what the future is predicted to hold.
“Candidly, it’ll be a while before we start to see numbers from government agencies,” Shams warned.