Companies offering digital services or selling goods online are experiencing a huge increase in customer demand under widespread shutdown orders, while other companies are affected by the coronavirus crisis. New data from the start of tax automation Avalara shows that while total spending was relatively low, the pandemic has clear winners and losers.
Avalaras Transaction overview This helps with processing and shows that discretionary consumer spending has not decreased across the board despite orders for staying at home. The relatively steady average was maintained by an increase in spending on items that help consumers find shelter at home as other industries saw a sharp decline in transactions.
Customers spend more on survival goods such as water purifiers, storage ovens and solar panels. Sales of these goods have increased by 163% since the beginning of the year. Weapons and ammunition are up 123%.
Products that fill the time at home are also on the rise, such as hobby and DIY needs as well as children's entertainment. For example, sales of home improvement material rose by 209% in March. Not surprisingly, food delivery services are booming too. Consumers spent 154% more on the delivery of specialty foods such as desserts and coffee.
However, the relocation has taken a huge toll on companies with no online sales ability. These companies saw an average 74% decrease in transactions compared to their sales in January and February. For articles that are no longer as necessary for everyday life as shoes, jewelry, evening wear and adventure gear, sales fell by more than 70%. Transactions for auto products fell 79%.
The data gives an insight into how the coronavirus crisis could change the economy by favoring large online retailers like Amazon and job productivity companies like Zoom while pounding brick-and-mortar retail.
Amazon, Microsoft, Zoom, and other companies that help people work remotely with software tools report strong sales and an increase in their stock prices. But smaller companies – even in the relatively resilient technology industry – struggle to stay afloat.
