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How Our Business Got Hit by COVID-19 Event-Cancellations Whose Effects Now Cascade Through the Industry

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Via Wolf Street

This is in a microcosm what businesses of kinds all across the US face.

By Aaron “Ripp” Ripplinger, Strategic Director, Anton Sport & DesignAShirt.com. For WOLF STREET:

Wolf here: “Ripp,” a long-time commenter on  WOLF STREET, was instrumental in creating the WOLF STREET beer mugs, and he set up and runs the WOLF STREET STORE, where you can buy these “Nothing Goes to Heck in a Straight Line” mugs.

Major League Baseball announced Thursday that it will be suspending Spring Training in response to the continued spread of the COVID-19 virus. This is just another case in a long list of events that have been cancelled or postponed due to the ongoing pandemic. The latest figures estimate that over 30 million people have been affected so far by these changes.

Here in the Phoenix metro, MLB spring training is a big deal. According to the Arizona Governor’s office, spring training has a $600+ million-dollar impact on the local economy. Over a million out-of-state fans arrive each year from the end of February through March to watch the highest concentration of games in the country. The median visitor stays four nights, attends three games, and spends over $400 per day. This influx supports over 6,400 jobs each season.

This is big business in Arizona, and the suspension of the season is a blow to the local businesses that were expecting another big year catering to this annual event. This, coupled with the cancellations of just about every other event in the near future, is sending a cascade of order cancellations through other industries.

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My company is in the custom decoration/promotional product business, and events are one of the biggest markets we cater to. We supply everything from custom t-shirts, hats, and jackets to logoed keychains, pens, and mugs. We’re behind all of those free (and mostly useless) swag items companies give away, the t-shirts the staff wear, or the merchandise being sold.

In the past week, we’ve been getting calls and emails from clients around the country who need to cancel their orders because the event they were hosting or attending has been cancelled or postponed. Some of these clients had purchased for events well in advance, and are now stuck with items they may not be able to use.

The 26th annual Arizona Aloha Festival was scheduled to begin on Saturday, March 14th, but was cancelled on Thursday night due to a ban on all city permitted events. They are now sitting on hundreds of T-shirts they were hoping to sell at the festival.

We are working to help them create an online store to try and sell this merchandise and offset the loss caused by this last-minute cancellation. This story is being played out around the country from others in our industry as more and more events are cancelled. Hopefully most of these items can be used for other marketing purposes, but many will be relegated to storage rooms, charity boxes, or landfills.

The uncertainty has sent panic through Arizona’s public university system. ASU and NAU have both moved all classes online for at least two weeks. All athletic events have been cancelled, and I expect most campus events will follow suit in the coming week.

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These events are big time business, and generate millions of dollars of revenue for the promo industry. We’ve had nearly twenty university orders cancelled in the last few days alone, and those were all just the athletic events. This is the scenario in just about every city in America right now, and the waves are being felt by everyone downstream.

This isn’t just an issue with huge events or major corporations canceling their orders either. A local Little League just received an order, and a few hours later they postponed their current season indefinitely. Several customers have cancelled their shirt orders for family reunions because they are unable or unwilling to travel. The Baker-to-Vegas Challenge Cup law enforcement relay has been postponed along with their updated official merchandise order. Local businesses and events are hesitant to spend money on these types of products right now because they are afraid of an uncertain future.

On the other side of the spectrum, we’re now starting to face issues from our own suppliers. Inks from overseas are facing major delays with no known delivery dates, and stockpiling is only making the issue worse. Many of the custom products from China are either on backorder for weeks or lost in transit completely.

Our own industry trade shows and training events are also getting cancelled, which again cascades through other businesses in those local economies.

The promotional products industry, like many others, has been booming for years now. Online marketplaces and direct fulfillment have made it easier than ever to get custom orders made and delivered all over the country.

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I don’t think many of these businesses ever considered something like a global pandemic – and likely subsequent economic downturn – would affect them to this degree. We’re prepared to weather the storm brought on by these events, but there will probably be a few less boats in the water when it’s all over. By Aaron “Ripp” Ripplinger for WOLF STREET

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