Independent retailers: how are they bearing up amid COVID-19 crisis?

Consumer confidence Retail sales High street, independents, retail

As the UK and Ireland creep closer towards a coronavirus lockdown, independent retailers are already struggling with a slump in footfall and a drop in consumer demand, as the supermarkets take a much larger slice of consumer budgets, with panic buying of essentials on the up in case of forced self-isolation.

This is a new and unexpected challenge for every business, and wardrobe updating is not going to be a priority for customers. Some independents are remaining resolute in the face of adversity, while others are more gravely concerned at the detrimental affect it’s having, or will have, on their businesses. Here’s the word from six on the front line.

Victoria Suffield, owner and director, The Hambledon, Winchester

“So far trade is holding up. Footfall is down, but revenue isn’t. Everyone who comes in has the intention to shop. I think many of our customers, who would usually travel up and down to London every day, may be working from home and are consequently shopping locally. It has also had a positive effect on our online sales.

Having to close like they have done in Italy would be absolutely devastating though. We don’t qualify for business rate relief which, as a small business in a large building, is pretty irritating. I employ a pretty large team for a single store, so the wage bill without income is a little daunting. I think the government seems to be delaying the most draconian measures like store closures, but we’ll just have to wait and see.

If people can’t actually get in to the shop, I would see us continuing to communicate regularly with customers online – driving as much business through the website as possible. In terms of deliveries, we have already experienced delays with China and Italy, and I’m not sure which countries will be affected next.

It seems there are some government measures in place for smaller business, but we are in the unhappy position, in this particular situation, of not being quite small enough. The interest rate cut doesn’t help us, as our borrowing is very low. Deferred payments for VAT may help cashflow in the very short term, but just move the problem slightly further down the line.”

Stuarts
Ravi Grewal

Ravi Grewal, CEO and creative director, Stuarts London, Shepherd’s Bush

“Footfall is down, not massively, but notably, as consumers are going out less and most public gatherings are being cancelled. But it hasn’t yet impacted on our online business. Right now, we don’t have coronavirus cases listed in Shepherd’s Bush, but things can change.

If needed then we will consider shutting up shop to protect our staff, or remain open for click and collect but close out general footfall. Of course, it would be devastating to business and it’s tough to strategise, but we will try to continue to increase our online sales. I’m not sure what the government can do, but we haven’t had any form of support. If we do have to close, a decrease in rates would be helpful.”

Jonny George, buyer, Elements, Norwich

“We intend to stay positive, work through it and adapt to the situation as and when it develops. The circumstances are changing daily, both nationally and locally, so we will have to adapt accordingly. The weekend trade was steady, but going forward it’s going to be very tough.

We’ll have to prepare a cost effect plan as best we can for the next few weeks. This will include a contingency for staff and updating our website in terms of stock and layout. We can utilise any online sales and our social media presence can continue if the store were to temporarily close due to government intervention and we had to work remotely.

At present, footfall has dropped off a bit but I think once schools close, which is a matter of when, not if, then the reality of the situation will really hit and we expect things to slow up. For the time being there have been very few cases in the area, but it is on the rise. Speaking to customers working in the NHS, the local hospitals are now gearing up for a real hit of cases to come in.

The budget last week was a positive one. With the abolition of business rates, government refunds on statutory sick pay and the offer of grants for small businesses. Again, this situation is continually developing so I’d imagine the government’s short term response will also evolve.”

Louis Copeland

Louis Copeland, CEO, Louis Copeland, Dublin, Cork and Galway

“Confirmed coronavirus cases in Ireland are creeping up now. They’ve upped the testing and, the more people they test, the more they are going to find.

They are obviously difficult times and I hear, through the grapevine, that the government is going to announce a lockdown in Ireland tomorrow, in effect from Wednesday, though shops are shut tomorrow anyway because it’s St. Patrick’s Day.

At least it will bring a bit of certainty and, with all the shops closed, aside from the pharmacies and supermarkets, everybody is in the same boat. It’s probably the best answer. It sounds like it will initially be for two weeks, and then they’ll review it. If it does happen, hopefully it passes over, then we’ll be back in business and hopefully stronger.

We’re trying to work out how we’re going to pay people and what we’re going to pay. That hasn’t been sorted out just yet. I think the government are planning to partially subsidise staff wages to the tune of €203 per week. The Board of Retail Excellence is the body that looks after all retailers in Ireland, and they’ve been updating us with guidance.

In terms of the VAT we have to pay, the government has also said that you can delay the VAT payments and they won’t charge you any penalties, which they normally would if you made a late payment.

We have four Louis Copeland stores in Dublin, one in Cork and one in Galway. We also have a Gant store in Dublin. The only problem we’re having with deliveries is we’re having too many of them! Footfall is totally down – there’s tumbleweeds outside the shops now. It’s not really had an effect on our online business though, and maybe when everyone is sitting at home doing nothing with the lockdown then online sales may increase. But people are saying that with everybody at home on their computers, or watching Netflix, that maybe the Wi-Fi will take a bit of a hammering.”

Pockets

Mark Taylor, co-owner and director, Pockets, Shrewsbury, Newcastle-under-Lyme, Hanley, Nantwich and Worcester

“At the moment, we’ve had a slowdown in footfall but then we’ve had a slowdown in traffic all this year what with the floods in certain areas, and just getting over the whole Brexit uncertainty. It’s really been one thing after another. There’s not been a significant dip just because of coronavirus, but you can just feel it in the air. It’s probably going to get worse in the next few weeks.

Surprisingly the online business has slowed down in the last few weeks as well. There’s all the worry about travel, so nobody is going on holiday – so they don’t need any new clobber, and customers are just thinking ‘do I need anything if I’m not going anywhere and I’m going to be locked in?’ There’s no necessity to buy an item of clothing, it’s probably the last thing on their minds. They’re more worried about stockpiling toilet rolls than buying a suit or jacket.

We haven’t got many cases at all in our areas, but according to the press it’s horrific everywhere. Unfortunately, everybody reads the newspapers and puts the news on and it’s doom and gloom everywhere. Reading between the lines, it’s going to get terrible, but who knows?

The way the press are talking, the potential of having to shut up shop for a couple of weeks like Italy is very much there withing the next few weeks, which would be devastating for us really. We have absolutely no contingency plans because this has come up out of nowhere – nobody knew what was coming, and nobody thought it was going to be as bad as this when it did.

We’re a small independent business with a close-knit customer base and close-knit staff, and we’ve got to try to look after them. If we have to close for the health and safety of our staff, then we will, and we’ll try our best to pay them their wages, because nobody can survive on statutory sick pay. So, we’d unfortunately have to find that within the company. Being privately owned by ourselves, our real issue will be cashflow. Not having to pay business rates will help, but it’s only a small help.

It’s a big concern for everybody. We’ve got friends who’ve got restaurants and coffee shops and their business has halved – if not more. I’ve got another friend who’s a builder, and he’s had to pull guys off sites. If you’re working on one of the big sites, such as the new housing estates going up, and you’ve got over 500 guys working on it, then they will all have to pulled off the job. It’s going to have a massive effect on the economy, and a knock-on effect everywhere with nobody spending. It’s not going to go away short-term either, this is going to go on for a while by the look of it.

David Johnson, owner, John Douglas, Macclesfield

“It’s like people are so nervous and frightened of spending any money in case they’re out of a job or don’t get paid. Everyone is nervous about a complete shut down like Italy, and is in a state of limbo.

It’s completely blown away business this last week. We had a good January and not too bad February – when it never stopped raining which took footfall off the high street but, with the escalation of the virus, and with it being non-stop in the news, it’s like people aren’t spending any money and there’s nobody about.

In terms of the virus in our area, as far as I’m aware know we’re good so far. There’s nobody that I know of locally that has been diagnosed, and we know a lot of people. I came back from Venice a couple of weeks ago, and obviously that’s now in lockdown like the whole of Italy is. My son was with us and, on returning, his company wouldn’t let him in to work, so he’s been working from home. We’ve not been tested, but we’re all fine. My wife rang 111 and they asked how we were feeling and if we had a temperature or a cough. We told them we hadn’t, and they said ‘well you’re fine.’

I think having to shut up shop is going to happen. The government has at least given us an amnesty on the business rates bill so, going forward this year, I’m going to be £14,000 better off. That gives me a bit of breathing space, and it helps to take the hit on a big lump of turnover that we’re probably going to lose in the next three months if the virus continues to escalate.

In the interim, I may end up stripping it down to a three-day week, and maybe next week just open on Thursday, Friday and Saturday to keep it simple. We’re more of a destination store anyway. There’s nothing worse than standing around twiddling your thumbs with nothing to do when you’ve done everything, and staring out of the window into the abyss because there’s no people about.”