SAN FRANCISCO—Womply, a small business software company, is working to quantify the impact of COVID-19 on local businesses. The data science team at Womply is conducting ongoing, daily data analyses of transaction trends at small businesses across the country.
The data reveals what many have heard about or seen firsthand—COVID-19 is driving many independent lodging businesses to close indefinitely and/or see a major loss of revenue. For this study, Womply looked at credit card transaction data at 5,600 independent lodging establishments and defined ‘closed’ as having no transactions for three consecutive days.
Plummeting revenue and increases in “stay at home” orders have forced a lot of businesses to close down indefinitely. Here’s what Womply did to learn how many businesses have stopped transacting due to COVID-19:
- Womply analyzed credit card transaction data at businesses who were regularly transacting between Jan. 1-March 1
- A business was designated as “closed” if it didn’t process a single transaction for three straight days starting on March 1
- If, after that three-day period, the business processed a transaction, they are no longer considered closed and Womply back-updated previous dates to represent that business as being “open”
- Note: Restaurants and other businesses who have shifted to processing 100% of their transactions via third-party delivery apps (like Doordash, Grubhub, etc.) would also show as being “closed” by this metric
The graphs below detail the increasing rate of closure for lodging businesses in the U.S. during the month of March and how their closure rate compares to other industries:
Among other findings:
- As of last week, independent lodging businesses on a national scale saw a 79% decrease in average revenue compared to the same week in 2019.
- California and New York, two states highly impacted by the effects of the pandemic, saw an 85% and 86% decrease in average revenue at lodging establishments, respectively.
- As of March 29, 12% of New York lodging businesses were closed and 13% of the California lodging businesses were closed.