The Wall Street Journal - 16.03.2020

A8| Monday, March 16, 2020 ***** THE WALL STREET JOURNAL.

THE CORONAVIRUS PANDEMIC

back online, but Mr. Foreman
fears the pandemic will mean
fewer sales of its Tonka trucks,
Lite Brite, Lincoln Logs and other
offerings.
Companies with fewer than
500 workers employ about 60
million people, or about 47% of
the private-sector workforce, ac-
cording to the Small Business
Administration. The challenges
these businesses face and the
steps they take in response, such

ContinuedfromPageOne

such as policing, health and

transportation.

As of Sunday afternoon, con-

firmed infections in Spain had

reached 7,753 people, a 35% in-

crease from a day earlier. Spain

had also confirmed 288 deaths

from the virus, more than dou-

ble the amount a day earlier.

Almost half of the infections

are in the area of the capital,

Madrid. On Saturday the gov-

ernment said Begoña Gómez, the

wife of Prime Minister Pedro

Sánchez, has tested positive for

the virus after two ministers

tested positive last week.

Germany plans to introduce

strict controls along its western

and southern borders at 8 a.m.

on Monday, affecting Austria,

Switzerland, France, Luxem-

bourg and Denmark. Travelers

who have no significant reason

to enter or exit the country will

be denied passage, Interior Min-

ister Horst Seehofer said. The

French government said it also

plans to introduce border checks

along its eastern border with

Germany.

Commuters who need to

travel abroad for work will be

exempt, and the traffic of goods

won’t be impacted, French and

German officials said.

In Paris, the French govern-

ment’s decision to close down

shops and restaurants was

greeted with general noncha-

lance by people who poured

onto the streets on Sunday.

“Look around, there are peo-

ple everywhere,” said Murielle

Texier, 49, rubbing her hands

with sanitizer after she cast her

vote.

In the U.K., authorities are

facing a backlash to the govern-

ment’s decision to hold off on

introducing strict social distanc-

ing measures, such as closing

schools.

Authorities reason a massive

clampdown in the early stages

of the virus’s spread would sim-

ply cause mass infection to re-

emerge later in the year. The

British government is also reluc-

tant to shut down the country

too early during the pandemic,

fearing that a population holed

up at home will go stir crazy

and begin to venture out just as

the novel coronavirus hits its

peak.

On Sunday, however, the gov-

ernment began to contest the

views of its chief scientific ad-

viser, Patrick Vallance, who says

Britain needs to acquire “herd

immunity.” Mr. Vallance’s rea-

soning is that there is no cure to

the novel coronavirus so natural

immunity is the only way to

stop its spread.

On Sunday, Health Secretary

Matt Hancock instead talked of

tightening measures, saying

people over 70 years old would

be asked to self-isolate in the

coming weeks “for a very long

time.” The government is also

preparing to ban mass gather-

ings, starting next weekend.

Britons have begun to take

matters into their own hands,

stocking up on groceries and

preparing to keep their children

out of school—ignoring the gov-

ernment’s advice.

Soccer’s Premier League,

which was given the go-ahead

by the government to hold

games this weekend, called off

matches after a coach and a

player were tested positive for

coronavirus.

In Italy, where there were

24,747 confirmed infections and

1,809 deaths as of Sunday, cities

and towns were deserted. Hospi-

tals are under heavy strain in

the north of the country, and au-

thorities said they are running

short on intensive care beds and

basic supplies, such as face

masks.

On Sunday, Foreign Affairs

Minister Luigi Di Maio said

China was shipping medical

equipment to Italy such as cru-

cial ventilators. That followed

another Chinese shipment which

arrived on Thursday night to-

gether with a team of medical

experts who dealt with the out-

break in China.

—Bojan Pancevski in Berlin,

Noemie Bisserbe in Paris, Max

Colchester in London and

Margherita Stancati

in Rome

contributed to this article.

turnout was 39%, compared
with 55% in 2014. Voters
brought their own pens to cast
votes, and bottles of hand sani-
tizer were stationed near the
ballot box.
“We are going to continue to
go outside for grocery shopping
or fresh air. It is legitimate to al-
low people to go and vote,” said
President Emmanuel Macron af-
ter voting himself in the north-
ern town of Le Touquet.
Prime Minister Édouard Phi-
lippe said he would consult a
committee of health experts and
political leaders on whether to
hold the second round of voting
on March 22. Several lawmakers
have demanded a delay.
Spain’s 15-day lockdown re-
quires Spaniards to remain at
home unless they need to buy
food, medicine and other essen-
tials. The lockdown, which can
be extended with parliamentary
approval, also makes exceptions
for emergencies and for people
to go to work.
The central government in
Madrid will take control of ser-
vices that are usually in the
hands of local governments,

ContinuedfromPageOne

Europe

Bears Brunt

Of Crisis

National municipal elections went ahead Sunday as scheduled in France.

A woman cast her ballot in Bordeaux.

NICOLAS TUCAT/AGENCE FRANCE-PRESSE/GETTY IMAGES

as furloughing or laying off

workers or pulling back on in-

vestment, will quickly ripple

through the broader economy.

The pandemic is likely to be

particularly challenging for small

companies because they tend to

operate on thinner margins and

with smaller cash reserves. A

2019 report by the JPMorgan

Chase Institute looked at 1.4 mil-

lion small businesses with a busi-

ness banking deposit account at

the bank and found 29% of those

in a typical community were un-

profitable, and 47% had less than

two weeks of cash liquidity.

The March drop in small-busi-

ness confidence reversed four

months of gains. More than twice

as many business owners said

they expected the economy

would weaken rather than im-

prove in the coming year, accord-

ing to a monthly survey of more

than 900 businesses with $1 mil-

lion to $20 million in revenue by

Vistage Worldwide Inc., a busi-

ness coaching and peer-advisory

firm.

The outlook dimmed over the

course of the weeklong poll, with

38% of business owners who re-

sponded on March 9 reporting

that overall economic conditions

in the U.S. had worsened com-

pared with a year earlier, up

from 25% on March 2 when the

survey began. The portion of

companies that expect sales to

increase in the next 12 months

dropped to 57% from 70% over

the week.

MBX Systems, a 180-person

manufacturer of custom-comput-

ing hardware, recently reviewed

each area of its business to de-

termine minimum staffing levels,

figure out who is cross-trained

and determine who can be

taught skills in case they need to

cover for someone else.

MBX has told the half of

workers who can work re-

motely to do so, increased paid

time off to 15 days from 10, and

largely walled off its Liber-

tyville, Ill., facility. “For the

most part, we are not having

[visitors] come in unless there

is something like an audit or

something required for us to

sustain our business,” said Jus-

tin Formella, chief strategy offi-

cer.

Businesses that rely on

steady customer traffic are get-

ting hit especially hard. At Bo-

nanno Concepts, a Denver res-

taurant operator with 500

employees, customers began

canceling private parties and

other events. Then on Tuesday,

traffic to its 10 restaurants be-

gan falling.

“We are writing schedules for

everything from only doing 30%

of business to 50% of business,”

said co-owner Frank Bonanno.

For some firms, projections of

sales growth have vanished.

24G LLC, a digital marketing,

training and communications

agency in Troy, Mich., first re-

vised sales projections down-

ward a month ago when shut-

downs in China’s supply chain

reduced demand for its Ama-

zon.com Inc. marketing-services

team. A few weeks later, confer-

ence cancellations and travel

bans hit demand for the 108-per-

son company’s mobile marketing

displays. Though it expects to get

a boost in its distance learning

and virtual events business, 24G

says sales are likely to be down

slightly instead of growing 20%

as it had planned for.

“It is really stunning how di-

mensional this is and how it is

affecting every aspect of the

business,” Chief Executive Scott

Wiemels said.

Not everyone is hurting.

Maintenance Management

Group, in Livonia, Mich., which

provides cleaning services to

hospitals and other facilities, has

received nearly three-dozen calls

in the past two weeks from com-

panies looking for advice. “If the

last two weeks have been any in-

dication, I think we are in great

shape,” Sean Murphy, chief exec-

utive, said. With so much uncer-

tainty, “we could double our

business or we may have to shut

down for a period. We are trying

to be prepared both ways.”

Business

Confidence

Plunges

Italy

France

U.K.

Spain

Germany

0510

DAYS SINCE 100 CASES

15 20

25,

0

5,

10,

15,

20,

cases

Sources: Johns Hopkins CSSE; countries' governments

Note: As of March 15

Cumulative confirmed coronavirus cases

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