As we near the end of week three of lockdown in the UK, attention is already starting to turn – perhaps somewhat hopefully – towards what the retail landscape might look like when all this is passed.
Analysis of retailers with ‘underlying health conditions’ by AskTraders suggests that we are going to see a spate of closures on the High Street of some well-known brands. It also offers hope as to those that are going to survive.
There is also a lot of attention this week on the verticals within retail that are doing well so far – and by dint of that, which may well come through with flying colours and those that may not.
While AskTraders suggests that Superdry, Monsoon Accessorize and INTU may not make it – they were all looking somewhat precarious before all this happened, it has to be said, so the news isn’t so surprising – there is hope for many other retail brands, including Debenhams, which has been suffering for sometime, but which is likely to survive the lockdown.
On the vertical front, grocery, electronics, DIY, home and garden and some fast fashion – think spike in sales of leisurewear for newly created homeworkers – are all doing well so far. They are, after all, things people can do at home.
White goods, furniture, cars and houses are not selling very well at all: all big ticket items that require delivery into the home, it’s easy to see why not.
The big question, however, is this now the new face of retail? Surely, on the other side of the lockdown, people will be buying houses, cars, furniture and white goods. These sectors are suffering today very specifically because of the isolation conditions.
Retailers and allied such as Superdry, Monsoon and INTU face structural and systemic problems that would have brought them down anyway. The real issue retail – and any business – faces right now is how to keep going through what is an indeterminate period of hibernation. Most retailers are viable businesses with many customers – the key is to keep them ticking over while we wait out the rolling cloud of the pandemic.
Many are turning to money markets to raise capital to tide themselves over. Some are cash rich and, having had relatively good 2019/20 financial years are prepared to take a hit, but can keep going.
This is now the order of the day: keep calm and keep hibernating. The world will return, perhaps not quite the same – there will be many more online shoppers for starters – but return it will. With some state support, some expedient management and most of all an eye on the fact that there will be an end to this, retail can weather this storm.