Companies from major retailers and package carriers to local restaurants and hairdressers are awakening to a new economic reality in the new coronavirus era: being open to business is hard to close.
With an indefinite period of high costs and suppressed demand to keep workers and customers safe, businesses are navigating the ever-narrow path to profitability. To do the math, some businesses cut services and jobs. Others are raising prices, including the imposition of coronavirus-related fees, with the goal of getting customers to share costs.
For large companies, the cost and risks of operating in a pandemic are already under consideration.
Walmart Inc., Target Corp. and Home Depot Inc. have realized more than $ 2 billion in wages, bonuses and additional expenses for workers in the early months of the pandemic. McDonald’s Corp. stipulates that franchisees who clean bathrooms once every half hour and have digital kiosks after each order reopen their dining rooms. Ford Motor Co. The company opened its American assembly plants for the first time in two months this week, and employees were forced to put the useless factories in Michigan and Illinois immediately after testing positive for Kovid-19.
Read :- The Covid surcharge
The stakes are high for small businesses, which operate on thin profits and small cash reserves. When they reopen weeks after the closure, they are facing a cost-to-earnings ratio that is most likely to be hit.
Food and other commodity prices have gone up. Employees need protective equipment at work. Increasing unemployment, security issues and restrictions on the number of customers allowed to serve a business are limiting sales. Some have tried to raise prices to ease the divide, but greeting customers staying at home with high costs is a delicate proposition.
Billy Youzar saw the addition of extra fare to diners’ tabs as a simple way to offset the high food prices at his West Plains, Mo., restaurant, Kiko Japanese Steakhouse & Sushi Lounge. This is more convenient than raising menu prices, because Mr. User said the fee can be updated at one point in the business’s point-of-sale computer.
Regular customers are supportive, but when a photo of Kiko receipt showing the Kovid-19 surcharge appeared on social media, people who had never been to his restaurant started calling to complain.
“People in this community and my actual customers don’t care,” Yujar said. “The backlash I get from these tweets.”
Mr. Yujar removed the surcharge and increased the menu prices.
Other small businesses are embroiled in a surcharge strategy.
Harman Halisi, owner of Dawn’s Super Subs in Woodland Hills, California, said the cost of meats such as pastrami, grilled beef and corn beef has gone up by up to 60%, and new policies mean employees spend 25% more time cleaning. In response, the store added a 75 cents surcharge to the $ 1 sandwich. Most customers understand that, Mr. Halisi said.