Lockdowns across 2020 alone cost British “non-essential” retail £22 billion in lost sales, according to a new analysis by the British Retail Consortium (BRC). All the while, online retail profits – such as for the fashion retailer ASOS – have soared. Here are the key findings:
2020 was the worst year on record for retail sales growth with in-store non-food declining by 24% compared with 2019. These results have also been reflected in footfall, which was down over 40% in 2020. After some retailers embraced rapid increases in demand, others found their doors closed for the third time at the end of last year.
The BRC calculates that the three lockdowns cost “non-food” stores – mainly “non-essential” retail – an estimated £22 billion in lost sales. Furthermore, tighter restrictions in the crucial run-up to Christmas hampered retailers’ ability to generate much-needed turnover, which would have helped power their recovery in 2021. Retailers contributed £17 billion in business taxes in 2019, collecting a further £46 billion in VAT. A strong retail sector is essential to ensuring these future revenue streams for Government and local councils, vital for supporting local communities.
A recent study by the Local Data Company found that 11,000 shops permanently closed in the UK in 2020. This is expected to be followed by a further 18,000 closures in 2021.
Helen Dickinson OBE, Chief Executive of the BRC, said that retail firms are in desperate need of support from the Government in order to continue trading.
After 2020 proved to be the worst year on record, it is essential that the Chancellor uses the Spring budget to support those businesses hardest hit by the pandemic. Vital support in the form of an extension to the business rates relief and moratorium on debt enforcement, as well as removing state aid caps on Covid business grants, would relieve struggling businesses of bills they cannot currently pay and allow them to trade their way to recovery.
Tackling the challenge of Rates, Rents and Grants should be the Government’s immediate priority to ensuring the survival and revival of non-essential retailers and protecting the jobs of hundreds of thousands of retail workers across the country. The investment we provide to retailers now, will be repaid many times over through more jobs and greater tax revenues in the future.
Worth reading in full.
Stop Press: The Guardian has detailed the ways in which various “non-essential” retailers are planning to make real-life shopping trips “a pastime once again” when lockdown is eased slightly on Monday.
Marks & Spencer will instigate “greeters” at the doors of its stores, and contact-free bra fittings. There will be edits designed for current lifestyles, from barbecues in the garden, to working from home.
At John Lewis, Beautycycle will be in place from April 19th. For every five items of beauty packaging returned, customers will get £10 off their next beauty purchase until the end of April.
Gap will be offering free masks with a purchase to those with their Gap+ app, and Primark will be open two more hours every day next week.
Other retailers are taking a playful approach. River Island, which will launch stores in Coventry and Swindon next week, has a “shop like it’s 2019” campaign; one sign in store says: “In 2019 pyjamas were not acceptable work attire.” Anyone who makes a purchase in April will receive a voucher for 20.19% off their next purchase.
Worth reading in full.
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