Multichannel retailers are today open for business online-only in England and Wales, with many stores closed under second lockdowns that will affect Wales until November 9 and England until December 2. That period includes much of the traditional pre-Christmas peak trading season, with Black Friday set to take place while non-essential retailers are closed.
Homewares retailers are included in the second English lockdown as non-essential retailers who cannot therefore open, despite having been able to trade in the first lockdown. We take a look at what retailers in different categories have said about how they expect to trade during the second lockdown – with many expecting high levels of peak trading.
DFS today says it expects its online business to increase as its 169 English showrooms close between November 5 and December 2. Seven showrooms in Wales reopen on Monday November 9 following 16 days of closure, while five in the Republic of Ireland Ireland reopen on December 1 following a six-week lockdown. It is moving staff from showrooms to other areas of the business in order to offer remote support to customers as they buy online.
DFS says it continues to manufacture, deliver and install goods while its showrooms are closed, and that it does not expect this closure to have a material effect on its sales or profitability in the first half of its financial year. It adds, in a coronavirus update today: “Our experience of prior lockdown periods was that substantially all order intake disrupted during the lockdown period was either deferred until showrooms reopened or captured online.” DFS is a Top500 retailer in RXUK Top500 research.
Dunelm has found it “unexpected and inconsistent” that it cannot trade during the lockdown that starts today, when it previously could from May. However its 145 shops in England will offer click and collect services. Its nine Welsh stores reopen on November 9.
Online home delivery will also operate across the country. The retailer says: “Whilst the new restrictions have increased the level of uncertainty in the outlook for the financial year, we remain confident in our proposition and the adaptability of our total retail system. We look forward to welcoming customers back into our stores when the restrictions are lifted.”
Dunelm says it has performed “very strongly in store and online, across all product categories” since its first quarter trading update, which came out on October 15. Dunelm is an Elite retailer in RXUK Top500 research.
Superdry says that it has put plans in place, ahead of the current lockdown, to make the most of expected higher online demand.
Founder and chief executive Julian Dunkerton said: “Covid-19 continues to disrupt our store and wholesale channels, but this is being partially mitigated by strong sales through our ecommerce operations. This has been an important period for Superdry, with the launch of our full Autumn/Winter 20 ranges and a true focus on using our social channels to reach our customers and bring our brand reset to life. This activity is delivering record levels of engagement through our influencer-led Autumn campaigns, and we will focus our energies in this area over the coming months.”
As of today Superdry has 122 shops shut in England, Wales, France, Belgium and Ireland, although 117 shops are still open and trading. It says that ecommerce has grown fast during the second quarter of its financial year: in the last six weeks of the first half of its current financial year sales like-for-like online sales grew by 51.9%. Sales on its own website grew by 68.9% year-on-year.
But even when stores were open they were well down on the previous year. Like-for-like store trading fell by 32.4% in the last six weeks of the first half.
Over the first half altogether, to October 24, group revenue fell by 23.3%, improving slightly between the first quarter (-24.1%) and the second (-22.8%). Store sales fell by 44.8% over the first half. In the second quarter, when shops were open, sales were down by 32.1% on last year. Online grew strongly, with sales up by 49.8% in the first half, including growth of 16.9% in the second quarter - when shops had opened. Wholesale was down by 28.8% in the first half and by 28% in the second quarter. Superdry is a Top50 retailer in RXUK Top500 research.
Joules is planning to furlough all of its staff in England during the current lockdown but says that it still remains well placed “to satisfy higher anticipated online demand over the forthcoming peak trading periods, having completed several capacity and efficiency enhancements within the group’s UK warehouse during 2020.”
Chief executive Nick Jones said: “As we enter the peak trading season, the retail sector in England faces the challenge of having to close non-essential stores for the next four weeks.
“Despite this difficult backdrop, Joules has a very strong brand and a flexible business model, which has underpinned the group’s robust performance to date during Covid-19. In addition, we are well positioned from an operations and financial perspective, having built on the experience and lessons from the Spring lockdown.”
In the first 22 weeks of its financial year, to November 1, Joules has seen online sales grow by 35%, year-on-year (YOY) to account for 70% of its retail sales. Store sales, meanwhile, have seen sales down by 18% YOY since reopening in July. The retailer now has 1.5m active customers.
“Our AW20 collections have been well received by customers and our Friends of Joules digital marketplace continues to deliver growth ahead of our expectations,” said Jones. “As a result, we enter the peak trading period in a strong position. Our ecommerce business now represents 70% of our retail sales and we have made significant investments in capacity to ensure that we can continue to drive and satisfy demand through this increasingly important channel as we adapt to changing consumer behaviours." Joules is a Top250 retailer in RXUK Top500 research.
Quiz says it is closing its 36 English shops and 114 concessions from today, while its four shops and 11 concessions in the Republic of Ireland reopen on December 2 and its two shops and seven concessions in Wales will open a week later. Its 18 shops and nine concessions in Scotland and its four shops and 13 concessions in Northern Ireland are currently open. The retailer will furlough store and concessions staff where closure is enforced.
But customers will still be able to shop online via its own website and those of its trading partners. Its distribution centre in Glasgow will continue to operate, following health guidance. Quiz is a Top250 retailer in RXUK Top500 research.
The Works says it is well placed for this lockdown thanks to a strong summer and early autumn since the last one. It has learned from its experience in the first lockdown, and invested in very extra fulfilment capacity in anticipation of high online sales. However, it still believes that the latest restrictions will hit it sales, although that will be partly mitigated by the Government’s new job support scheme, which now extends support for furloughed workers until March.
Gavin Peck, chief executive of The Works, said: “Naturally, it is disappointing that we have had to close most of our stores again, so close to Christmas, but the strong performance since the last lockdown and our sound financial position mean we are well placed, and we are focussed on ensuring that we reopen safely, and are geared up to make up as much lost ground as possible in December.”
“The last six months has demonstrated the increasing relevance and appeal of our proposition, which gives us confidence in the long-term future of the business.”
The retailer believes that some sales have already been brought forward in anticipation of a lockdown. In a trading update for the first half of its financial year, to October 25, it said like-for-like sales were up by 10.6% in the 19 weeks to that date - following the first seven weeks when stores were still closed. Store sales were “broadly level” with last year but online sales were about twice as high as last year. Demand has risen for goods including board games, jigsaws, arts and craft materials and books. In the first half of the year, The Works closed a net four stores to take its total to 530 at the end of the period.
The Works is a Top50 retailer in RXUK Top500 research.