Written by: Keith Tully
Many high street retailers will face a fight for survival in the coming months after they reopen their doors to shoppers.
Non-essential shops have been given the green light to reopen from mid-June but there are serious concerns about how many retail businesses might still be struggling to stay afloat this year after taking a financial hammering in the context of the coronavirus outbreak.
Many retailers were hoping they might be able to reopen from June 1st but that now will only be the case for non-food markets and car showrooms.
Non-food shops across the UK are estimated to have lost in the region of £1.8 billion per week during the full lockdown that became necessary in late March as the coronavirus pandemic hit.
Among the concerns for retailers are the various practical issues around social distancing, customer safety and footfall, with many people likely to continue avoiding high street stores while the virus situation remains a problem.
“With sales expected to remain weak, even as shops begin to reopen, many retailers will still be in a fight for survival,” said Helen Dickinson, the British Retail Consortium’s chief executive.
Meanwhile, the Confederation of British Industry (CBI) recently polled close to a hundred retailers and found sales volumes that it described as “deeply depressed”.
As many as 80 per cent of the retailers polled by the CBI reported cash flow difficulties during May, which is a striking figure but one that actually fell from a high in April of 96 per cent.
Over half (53 per cent) of the companies surveyed by the CBI said they had been forced into making temporary layoffs, while 8 per cent said they had made people permanently redundant during May.
“The retail sector is at the sharp end of a crisis, with many businesses up against it,” said Rain Newton-Smith, the CBI’s chief economist.
“The government’s support packages are making a real difference with more shops reporting that jobs have been furloughed, rather than lost.
“As we gradually reopen the economy retailers may yet need more support from government if demand falters.”
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