The ongoing SARS-CoV-2 has wreaked havoc and caused significant turbulence in the lives of all of us in one way or another. Brick-and-mortar retail and the hospitality industry were already suffering pre-COVID from soft foot traffic and a shift in consumer landscape. The restrictions paused not only the customer centric industry but also severely halted supply chain distributions. Some of these businesses, including ones with brawny balance sheets, hit the last straw amidst the pandemic. The real estate, oil and gas, retail, and the entertainment sectors were some that were hit the hardest. Despite the fact that the CARES Act and PPP have provided many businesses a vertebrae, it has not permanently relieved unsettling uproar.
So the same questions persists in the minds of mainstream debtors as well as small business debtors; when will be emerge out of such a pernicious state and where will we land on the needle? Quite unfortunately, the individuals in the correlating industries do not have an answer regarding this pandemic and post-pandemic juxtaposition. The most speculated and agreed upon hypothesis has been that the economy will take a long haul to bounce back.
Even though filings in 2021 have decreased 45 %, according to Epiq, there is a great possibility that they could severely skyrocket if our economy continues to decline. It is well anticipated that this economic turmoil will escalate some time in the near future, as more companies will struggle to maintain stable EBITDA margins and stay afloat.