The Government’s latest announcement on Covid-19 restrictions represents a new low for the retail industry in Ireland. Since the start of January – and the start of the third lockdown – retailers have lost out on a full season’s worth of trading and saw the reintroduction of click-and-collect services as an absolute minimum on the road back to a full reopening of the industry.
However, the Government’s move to delay the reopening of retail in any form until May at the earliest has dashed their hopes and caused widespread disillusionment.
Up to this point, more than one year after the emergence of Covid-19 in Ireland, retailers have shown remarkable patience and understanding with a Government that clearly has a difficult task. But this patience is running out, and the trust that the industry has in this Government has been eroded. It is clear that this Government is losing the room and it is difficult to see how it can win it back.
There are a number of knock-on issues that its latest decision has caused, but as a starting point it does not help that the Government’s revised timelines for the reopening of the industry are unclear.
We have been denied a reopening of retail in any form in April, and at this stage all we can look forward to is a phased reopening of the industry from May, subject to public health guidelines. The ability to plan with any kind of certainty has been sorely lacking during this pandemic – a trend which has unfortunately continued with the latest announcement.
This has a very real impact on retailers’ bottom lines. Retailers need to be able to plan months in advance for future stock. For many clothing brands, for example, planning for next season’s stock needs to be done up to six months prior to sale. However, if business owners do not have faith in a reopening plan, then they are left in limbo.
They obviously do not want to buy stock that they cannot use, and this will have an inevitable knock-on effect on supply and distribution chains which have already been greatly impacted by Brexit. Retailers have been forced to slash financial forecasts on the back of being unable to sell most of their stock for spring / summer 2021, which has had a huge impact.
Furthermore, the Government’s decision will exacerbate the blurring of lines between its classification of what constitutes essential and non-essential retail, something which has become a significant problem in recent months. In reality, consumers are now dictating what constitutes essential and non-essential retail.
Essential versus non-essential
Certain retailers have flouted the rules by selling goods which could not reasonably be described as essential. This has caused a significant problem for smaller independent retailers who have been unable to open their doors since December. It appears the laws on selling essential goods are proving difficult to enforce.
A reintroduction of click-and-collect services is only the starting point on the road back to normal trading, but this would have stymied the essential versus non-essential problem and also provided a safe trading environment through which retailers could begin their recovery. The grim irony of the Government’s easing of domestic travel rules has not been lost on retailers, who know from experience that click and collect is largely conducted on a local basis.
Since the emergence of the pandemic last March, retail has proven to be a safe environment for staff and shoppers alike, with very few cases linked to the reopening of shops last year. Retailers have carefully put in place various safeguards such as Perspex screens and hand sanitisers, and have diligently enforced social-distancing guidelines.
The Government has shown that it does not have faith in the industry to maintain these high standards, which is disappointing to say the least.
By the end of April, it is forecast that at least 1.7 million people will have been vaccinated at least once against Covid-19. Given these projections, it is difficult to understand how retail can be ignored when almost 300,000 livelihoods are at stake.
As if this wasn’t enough, the retail industry is faced with a looming crisis on rents and fixed costs which will become apparent as the year goes on. Landlords are circling businesses in every sector demanding overdue payments and the Government will need to provide assistance on arbitration and grants if we are to avoid wholescale liquidations.
Retailers can only hope that Government assistance will be more forthcoming when that time comes.
Duncan Graham is the managing director of retail representative body Retail Excellence