According to CCTV news, the U.S. fitness industry has lost more than $7 billion in revenue so far. 489000 fitness workers in Michigan, New York, Washington and California have lost their jobs due to the state governments forced closure. If fitness centers in Texas and Florida are closed again due to the rebound of the epidemic, it is estimated that there will be another 28 in these states Ten thousand employees lost their jobs.
Chris creto, board member of the International Association of health, sports and fitness clubs, said the U.S. fitness industry has been hit hard by the epidemic and the U.S. government has not provided any relief measures. Kraito has written a letter of help to the U.S. government, hoping to get small loans for small and medium-sized enterprises during the outbreak. He also said that 25% of the fitness companies in the United States are expected to close permanently this year without government help.
Since the outbreak of the epidemic, American chain gyms applying for bankruptcy protection are like dominoes.
Golds gym, an established gym in the United States, filed for bankruptcy protection in May and is planning to restructure its debt and further close its stores, according to the news agency. The company said it had restructured under the bankruptcy law and would continue to have the right to operate its club until August 1 this year. Golds gym has closed 32 clubs permanently, including three at its Dallas headquarters, affected by debt. Golds gyms bankruptcy documents show that it has liabilities of between $50 million and $100 million. It is reported that the bankruptcy will not affect the franchisees of the gym, and golds Gym franchised stores account for 90% of all stores. Golds gym, which has been operating for half a century since the outbreak stopped, has reached its most dangerous moment.
In addition, 24 hour fitness, another large fitness chain in the United States, filed for bankruptcy protection. Meanwhile, town sports international, a large US gym operator, is considering bankruptcy, with four offline fitness brands, including New York sports clubs. Even gyms, including equinox fitness, have announced that their rental properties have been suspended to maintain their operations.
The bankruptcy tide of American fitness industry is closely related to the new crown epidemic. Novel coronavirus pneumonia novel coronavirus pneumonia data released by Johns Hopkins University in the US, as of July 26th at 6 in the evening, the United States reported 4225600 cases of new crown pneumonia, and 146788 cases died. In the past 24 hours, 61374 new confirmed cases and 489 new deaths occurred in the United States.
The who said the new coronavirus may stay in the air in indoor confined spaces, including gyms, causing human to human transmission. These factors make it difficult for us gyms to return to work in large areas in the short term.
Active self-help of American fitness industry
In addition to opening live classes in gyms to generate income, more and more fitness related platforms have joined the camp to generate income for coaches and gyms. For example, gymshark, a fitness clothing brand, provides a teaching platform for personal trainers. Since the end of March, private coaches have applied for online teaching to earn commission through gymsharks Facebook live channel. The channel has more than 1.7 million fitness enthusiasts.
In terms of gyms, classpass recently launched a live fitness function to generate revenue for the suspension of gyms during the epidemic. The gym will be able to get full benefits through live fitness on classpass until June 1, this year.
Over 3600 US companies filed for bankruptcy in the first half of the year
According to epiqglobal, more than 3600 U.S. companies filed for bankruptcy protection in the first half of the year as of June 30, up 26% from the same period last year. Among them, in June, due to the rebound of the epidemic situation in various parts of the United States, many places had to suspend the pace of restart, and the bankruptcy applications of American enterprises increased by 43% year-on-year.
According to the statistics of the American bankruptcy Association, since the beginning of March, more than 100000 small enterprises in the United States have closed down permanently. Professional analysis said that this may indicate that a wave of epic bankruptcy wave is about to hit.
Industry insiders believe that in the context of a new wave of economic shocks, the speed of enterprises applying for bankruptcy protection may be accelerated, and the current situation is just a calm period before the advent of the bankruptcy storm. The big six banks on Wall Street raised the provision for bad debts to $35 billion in the second quarter, which seems to have laid the groundwork for this.
In the long list of bankrupt enterprises, there are many well-known American brand enterprises. In addition to the JCPenney and Hertz mentioned above, there are luxury retailer Neiman Marcus, J. crew, known as the national fashion brand of the United States, Brooks brothers, which has served a number of US presidential wear brands for more than 200 years, and so on. Even Macys, one of the largest retail giants in the United States, was once rumored to be bankrupt. Fortunately, Macys successfully raised $4.5 billion in early June after several efforts, avoiding the fate of bankruptcy and reorganization.
At present, the U.S. epidemic is rebounding, the pace of economic restart has been slowed down, and consumer confidence has been shaken again. For many enterprises, it is still unknown when this survivability test will end.
Experts predict that the situation will only get worse, and this years massive bankruptcy - that is, the bankruptcy filing of companies with debts of more than $1 billion will easily set a record.
Bankruptcy is just the tip of the iceberg?
Zombie companies have sprung up
According to economists, companies that fail to generate enough profit or operating profit to cover the annual cost of debt for three consecutive years are often considered zombie companies..
According to Deutsche Bank, one in five US listed companies is now a zombie company. Compared with 2013, this proportion has doubled. More and more zombie companies will further undermine the strength of the economy, making central banks reluctant to raise interest rates from very friendly to zombie companies. This negative cycle will make more companies dead but not rigid and hinder the emergence of more productive competitors. Earlier, Drucker Miller, a well-known hedge fund manager on Wall Street, also mentioned that the Federal Reserves stimulus plan paid a lot of money to zombie companies just to keep them alive, and the V-shaped rebound of the U.S. economy is just an illusion. Of course, zombie companies are better than bankrupt companies and soaring unemployment; but the debt they accumulate will still pose considerable risks to the economy and the stock market as a whole. Extended reading gold price short-term diving concept stocks high open fall back Shanxi Yuncheng hit 99 yuan to buy roast chicken free travel: stop heavyweight immediately! Central bank investigates Joint Lending of commercial banks_ NF4368
According to Deutsche Bank, one in five US listed companies is now a zombie company. Compared with 2013, this proportion has doubled. More and more zombie companies will further undermine the strength of the economy, making central banks reluctant to raise interest rates from very friendly to zombie companies. This negative cycle will make more companies dead but not rigid and hinder the emergence of more productive competitors.
Earlier, Drucker Miller, a well-known hedge fund manager on Wall Street, also mentioned that the Federal Reserves stimulus plan paid a lot of money to zombie companies just to keep them alive, and the V-shaped rebound of the U.S. economy is just an illusion.
Of course, zombie companies are better than bankrupt companies and soaring unemployment; but the debt they accumulate will still pose considerable risks to the economy and the stock market as a whole.