that while some areas of the business are down, with customers shuttered and employees furloughed,
others have dramatically ramped up demand and offset the losses. A shift to focus more business on
high-demand product lines such as PPE and other health- and safety-related supplies such as hand
sanitizer also top the list of changes respondents reported. 29% overall are seeing changes or refocusing
their business, while the remaining 71% have not identified a new market need or changed business
focus.
PPP loans are in play for 76% of respondents, and concerns about loan forgiveness are somewhat higher
than in other studied industries, at an average of 57 on a scale of 1 to 100. 31% of respondents say PPP
loan forgiveness is high on their list of concerns for the next 12 months.
Revenue forecasts for Q2 of 2020 are off sharply, with 59% saying they anticipate moderate to severe
declines (28% expect the declines to be major). 17% expect to see increases, with 3% at the top end of
the spectrum expecting major positive growth. In Q2, the percentage expecting declines drops to 44%,
with the biggest change in those expecting dramatic declines from 2019 levels (down to 3%).
By Q4, 80% are expecting business to be on par with 2019 or to increase, with 14% expecting significant
growth and other 34% expecting at least moderate increases. The percentage expecting steep declines
compared to the previous year jumps up from Q3 levels to 7%.
21% are reporting higher morale, and a small percentage (3%) have seen a decline. Morale is steady for
the rest.
As in most other industries surveyed, economic recovery time and the financial stability of customers
and vendors top the list of concerns, with 59% of respondents citing both issues. Employee issues
including well-being, health and safety, and layoffs or furloughs are also a major concern for 41% of
respondents, and cash flow concerns trouble 17%. Others noted concern about paying for federal
expenditures and the tax revenues for state and local governments, the length of time required for small
businesses to recover, and overall economic challenges. Inventory management is a concern for some
respondents, who report dramatic fluctuations in demand both up and down over the past few months.
Wholesale/Distribution industry responses to a question asking how their business had changed
included:
• “Customers serving schools, hotels, and clubs are down. Customers serving essential retail is
up.”
• “No walk-in traffic and more online sales.”
• “Many customers are closed with their employees furloughed; however several are suppliers for
in-demand medical products. Focusing on these customers has kept us busy, but these are low
margin products. So, we need to consider things like cash flow and employee resources.”
• “Obviously, a huge rush on sanitizer bottles and associated sprayers/dispensers. Dramatically
increasing stock on those items.”