FITA INSIGHTS
The Impact of COVID on British High Street Retailers
By
Biki John
Aug 26, 2020
4 min read
The detrimental impact of COVID on British High Street retailers so far.
Store Closures
The first wave of COVID shook a lot of British high street stores and rattled them hard. Cath Kidston was one of the many U.K. retailers that had to close its doors and focus on its online platform.
For Cath Kidston, the iconic British brand’s store closures led to hundreds of job losses. When asked to share her thoughts, Melinda Paraie, Cath Kidston’s chief executive officer revealed that “despite our very best efforts, against the backdrop of COVID-19, we were unable to secure a solvent sale of the business.”
Among Cath Kidston, U.K. retailers like John Lewis, TM Lewin, Warehouse, and the department store Debenhams, have either had to reduce their shops or permanently close down their stores due to the pandemic. One of the reasons behind this was voiced by a spokeswoman for John Lewis who confirmed, “the reality is we have too much store space for how people want to shop now.”
Are Things Looking Up?
Now we are heading into autumn, most brick and mortar stores in the U.K. are not facing the tight restrictions that were imposed earlier in March and April, but that doesn’t mean physical stores are out of the woods. The first wave of the pandemic had a devastating impact on retail and shopping as we know it and as we face the ‘new normal’ its aftershocks will be felt for a long time to come.
As the U.K.’s store footfall struggles to pick up, the road to recovery remains uncertain. But could there be hope? Earlier on this month, Drapers reported that ‘high street footfall fell by 47.5% year on year, an improvement on June’s 64.5% tumble.’
Helen Dickinson, chief executive of the British Retail Consortium’s (BRC) adds, “July was the first full month in which shops were allowed to open in all parts of the UK…the re-opening of pubs, cafes and restaurants has also provided some additional footfall to many high streets, including a small boost to local retailers. It remains too soon to say how well retail will recover in the coming months, but it clearly remains a difficult trading period for many physical retailers.”
Shifting Retail Stock
With store closures up and down the high street and in the U.K. retail industry in general, it’s not surprising that both high street and e-commerce retailers have had to resort to large discounts to move their spring/summer stock.
Earlier in May, Marks & Spencer was one of the many stores in the U.K. that ran a massive high-price discount online. 10% of the sales proceeds were donated to NHS Charities Together. Karen Millen offered a whopping 40% sale on their e-commerce site and popular high street brands like ASOS, French Connection, and JD Sports have also followed suit and offered spring/summer sales promotions.
COVID came out of nowhere and consequently, retailers were not able to prepare for it. A high street retailer expands on this point by explaining that “the stock [retailers] were able to get out of [with canceled orders] was negligible in comparison to your intake. We’ve been able to sell through quite a lot online but it has been promotionally led.
We’ve also recoded a lot of our stock to put summer ranges into the early part of autumn. However, next spring we could see bargains galore with the return of spring 20 seasonal stock that needs to be shifted.”
Stores have also tried to be creative with their promotions by alternating the price of their discounts, as well as selling products at their full price.
With spring sales looking like they will creep into the autumn season, this may very well delay autumn pieces being unveiled.
Currently, the U.K. retail industry continues to face obstacles like social distancing and the general fear of the virus. It will be interesting to see how consumers engage with retail products as we settle into the autumn/winter season.
Photo credits – Jonathan Chng, Clem Onojeghuo, and Jon Cellier
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