By Syndication Washington Post, Bloomberg · Sybilla Gross, Ryan Cavataro · BUSINESS, WORLD
Business is down 70% since late January when the first case of the novel virus was reported in Australia, according to Lily Zhou, 39, who owns the Shanghai-style restaurant with her husband. If things continue as they are now, Zhou said she can only stay in business "at most three months."
With many Chinese Australians still stranded in China after the Lunar New Year holidays, or staying behind closed doors in self-quarantine, Zhou's business isn't the only one that's struggling. Compounded by the paranoia that's keeping people away from Chinese neighborhoods, the outlook is so dire that the local council in Eastwood plans to set up a $500,000 ($330,000 U.S.) assistance fund.
As the outbreak spreads across the world, the impact is being felt in Chinatowns from Sydney to New York and from San Francisco to Toronto. While markets are whipsawed by the crisis and economists calculate the cost to gross domestic product, the deserted lane ways and empty hotpot restaurants show the reverberations at street level and the palpable anxiety seeping through communities.
At 99 Favor Taste, a popular hotpot and BBQ restaurant on Grand Street in lower Manhattan, customers typically have to wait at least half an hour on weekdays to get a table, according to store manager Echo Wu. Now they get seated straight away and booths are empty, while weekend customers are down by a third, Wu said.
The vast majority of customers are typically "foreigners" rather than Chinese, and Wu believes irrational fear is keeping people away. One customer the other day telephoned ahead to check the food wasn't imported directly from China.
"They may have a bias toward Chinese restaurants now," Wu said. "I hope people can be more reasonable. After all, there's no cases in town yet."
The picture is similar in Toronto, where trade at the Rol San dim sum restaurant is down as much as 30% and the usually bustling sidewalks are quiet, according to the manager, who identified himself only as Ben. When asked if that's because of the coronavirus, he replied: "Of course." At a nearby supermarket, workers said the number of customers had halved in recent weeks.
At the Chinatown in Manchester, the second-largest in the U.K., the strain on business showed after Chinese students - who typically account for about 40% of the customer base there - stopped showing up as they returned from the Chinese New Year holiday, according to Raymond Chan of the local business association."There are less visitors, less customers. They're really, really suffering - at the moment we haven't come up with any solution yet," Chan said. The group is discussing options such as opening a weekend market with free food tasting and discounts to bring back clients.
The usual lunch-hour bustle in San Francisco's Chinatown has evaporated and many of those who do venture out in the neighborhood donned masks. "Usually we have a line out the door," said Henry Chen, 56, owner of the AA Bakery & Cafe on Stockton Street, who blamed fear of the virus for business dropping 30%. Only two tables had customers. "There are less people on the street," he said. "Lunch, dinner, breakfast, there is no business."
Still, the drop-off in business in western cities is dwarfed by the widespread disruption in Hong Kong, where schools are closed and thousands are shuttered in their apartments - forced to work from home as authorities and companies try to stop the spread of the virus. It's hardly a wonder that streets there are virtually empty as the virus embeds itself into everyday life and shuts down the consumer economy.
Lockdown measures have spread beyond Asia, with Europe's worst-hit nation Italy imposing quarantine measures in the regions of Lombardy and Veneto. Schools, universities and museums have been closed and sporting events canceled. Many small businesses in Prato's Chinatown near Florence are shuttered. Yet some businesses are benefiting - amid panic-buying of food, face masks and hand sanitizer.
Back in Sydney's Eastwood, some local outlets are also thriving. The Phoenix health and beauty store can't keep up with orders for vitamins or milk powder products as local Chinese stock up, or send items back to the mainland. Assistant manager Ruby Han has been working overtime, while the firm tries to hire new staff to cope with skyrocketing sales.
"It is crazy!" Han said. "One customer, they probably only need like three jars, but now they are getting like 12 jars in one go."
And that's nothing compared to the demand for face masks, hand sanitizers and alcohol swabs.
"It's like every 10 minutes people will come to check - 'Do you have some masks? Do you have some masks?'" she said. The store has rationed stock to customers and still runs out, she said. "To be honest, we can't handle it because the demand is just too high."
The so-called daigou trade, where consumer goods are bought by professional shoppers and sent back to China, is booming. AuMake International Ltd. said online sales exceeded A$1 million in the 14 days to Feb. 10, more than double the prior four weeks - buoyed by demand for face masks, sanitizers and immunity-related health supplement products.
"This is a once in a decade, or two decades, event," said Executive Chairman Keong Chan. "We know with Chinese New Year, we anticipate a fairly decent amount of sales, and it is way more than that. I can only conclude that the virus is a very big part of that."
The same products are flying off the shelves at a small pharmacy inside the Dragon City Mall in Toronto.
"We probably used to sell about 100 masks a week, now we sell north of 700" despite fewer people visiting the store, said pharmacist Timothy Tran, 57. In addition to individual customers, banks and other businesses are coming in and buying masks in bulk, he said.
For Philip Wu, manager of the Dolar Shop hot pot restaurant in Sydney's Chinatown, lifting the travel restrictions that have stranded hundreds if not thousands of Chinese Australians on the mainland and decimated the tourist trade, is vital.
"If the government says 'OK, we'll stop the ban on the flights, and the people can travel to Australia,' then I think the business will go up very quickly, because tens of thousands of Chinese people will be coming back," said Wu, 43, who has seen a 60% drop in business and has asked his 100 workers to cut their hours to four days a week.
There seems little immediate prospect that will happen, with Australia's National Security Council reviewing the ban on people entering the country from mainland China on a week-by-week basis.
In New York's Chinatown, Jan Lee, a former local business owner and an organizer with Neighbors United Below Canal community group, is philosophical, saying fear of the virus will diminish as happened with the SARS epidemic 17 years ago.
"We have to separate the science from the myth, and I think that's what happened with SARS," Lee said. "Eventually people started to understand that it was not dangerous and they started to come back. People need their Chinese food and eventually they're going to come back."