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Iranian High Street Businesses Suffer because of Coronavirus

March 16, 2020
You in IranWire
6 min read
While businesses are usually booming every March, during the Iranian New Year celebrations, this year's coronavirus outbreak has affected many businesses.
While businesses are usually booming every March, during the Iranian New Year celebrations, this year's coronavirus outbreak has affected many businesses.
A market downturn and paying the rent is a common concern of many business owners.
A market downturn and paying the rent is a common concern of many business owners.

Ziba Almassy, citizen journalist, Karaj

 

While businesses are usually booming every March, around the time of the Iranian Norooz (New Year) celebrations, this year's coronavirus outbreak has affected many parts of the economy. This report looks at several business-owners who are dealing with a downturn just at a time when they had expected to prosper.

Hanna is 27-years-old and works as a hairdresser and beautician in Fereshteh Street, north Tehran, and she says she earns a good income. "I earn around 500,000 tomans [$33] a day; when you deduct the cost of materials and the salon's share, I earn 7-8 million tomans [$470-$535] a month.

"We look forward to Norooz, when I earn two to three time more than usual, as we get more customers and we get a lot of bonuses and tips. ... This year, like every other year, on 21 January, I bought about 15 million tomans [$1,000] of nail polish, paying with three checks; one for 5 March, another for 20 April and the third for 20 May. Now with the coronavirus outbreak, I have not been able to earn back even the original amount."

Hanna takes a deep breath and says: "The nail polish salesman calls almost every day and says the checks have not been cleared. I ask him to take them back! He says he cannot accept returns. This is my New Year's Eve situation. My colleagues are no better off than me. Everybody has spent their funds before the New Year, and now we’re going into next year with a lot of debt.”

Hanna pauses again and says: "My appointments were all booked from December. If everything was normal, we would not even have time to scratch our heads.”

Some hairdressers closed very quickly – others have just shortened their hours. She said. "Some hairdressers say they work every other day and that they disinfect everywhere after each service. But our salon has closed. Because it is a brand, and if something happens, the salon will be even more damaged."

Saghar has an appointment for a facial and her nails for 17 March. Last week the hairdresser contacted her and asked if she was still planning to attend. When the hairdresser sensed her hesitation, she said, “We are very careful. We disinfect everything and leave plenty of time to sterilize our equipment after each customer. We wear masks and try to observe health guidelines." Nevertheless Saghar turned down the appoint.

"The hairdresser was desperate, trying to convince me so that I wouldn't miss my appointment. They obviously have financial problems. They have to pay a lot of rent. My hairdresser is the head of a household who pays for herself and her child. In the last two weeks, three women booked her services for their weddings, and she received the deposit. But the weddings were cancelled and she had to return the money.”

Amir Reza is a 39-year-old pizza chef, working in one of the capital's most famous pizza restaurants.

"It's awful," he says. "We always work with gloves and ingredients are prepared in the presence of customers. They say coronavirus disappears in the heat, but our sales have dropped to a seventh of normal times. We cannot have in-person customer service and can only offer online ordering and take-away. The restaurant manager says he is paying 17 million tomans [$1,133] of rent a month and about 15 million tomans [$1,000] to restaurant workers in salaries. Yesterday he said this month he had made only 7 million tomans [$466]." Amir Reza continues: "We even offered a semi-finished pizza initiative, and sent SMS messages to customers saying they can bake the semi-finished pizza in their microwaves. The coronavirus would disappear in microwaves but it didn't work."

Rosita, who has rented a small cosmetics store in west Tehran with her sister, says: "We have been here for three years and thank God we were always happy. Two months ago when our contract expired, my sister suggested that we not renew to take a break ... I said, 'No, we are established here,' and now every day, I tell myself what a mistake I made. Last year at New Year's Eve, we used to sell about 4 million tomans [$266] of products a day, but this year we are not even earning 200,000 tomans [$13] a day. Our monthly rent is five million tomans [$333]."

Mr. Rastegari owns a dried fruit and nuts shop in west Tehran. He says: "Every year during Norooz, there were queues of up to 10 meters in front of our shop. But this year it is even less than a normal day of the year. Thank God we own our shop, do not have to pay rent and can manage to pay the salaries and bonuses of our workers. ... I wish the government would pass a bill in parliament that landlords of all residential and commercial units across the country should not ask for rent in February, March, and April from their tenants. In the current situation, tenants cannot pay rent, and I think even if the coronavirus crisis is contained, a huge number of businesses will be on the verge of bankruptcy at the beginning of the summer."

Mustafa Ahmadi, president of the dried fruit and nuts sellers union, told the Tehran Chamber of Commerce on March 4th: "According to the advice of doctors and experts, the use of nuts ... will strengthen the body and prevent coronavirus disease. So people have turned to buying dried fruit and nuts." Ahmadi continued: "The process of producing dried fruit and nuts is carried out at temperatures above 300 degrees Celsius, so that there will be no contamination."

Soheil and her sister, who run a scarf shop in a shopping center in northern Tehran, says of their sales: "We are two families who make a living from this shop and our hope is to makes sales during the Norooz period. But we didn’t earn enough even to pay the rent this year, and still the health minister criticizes people and asks them not to leave the house unless it’s essential. What does essential mean? Essential is nothing but providing the basic expenses of two families. Not coming here and not opening the shop; where can I get the money to eat and live? In China, when they quarantined an area and asked people not to leave home, the basic needs of the people of the city were met at all times. In our case, the government does not provide any support. The commercial landlord has not the slightest but of compassion and offers no discount on the rent. Forget about waiving it outright."

"Believe me, if we didn't have to pay the rent," Soheil says, "and if we could afford the basic necessities, we would not come to the store to sell one or two scarves a day. We would be more careful with ourselves. But that's not the case." He takes a deep breath and says, "Every year at this time we hardly have a chance to breath, it’s so busy, but this year we won’t have a Norooz at all."

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