Retail devastated as London and South East move into lockdown

By

Sandra Halliday

Published
Dec 20, 2020

Only weeks after England’s November lockdown ended, a big chunk of the country has moved back into the tightest Covid restrictions as a new ‘tier 4’ means non-essential stores have again had to close in London and the South East.

Combined with existing restrictions in other parts of the UK, it’s a hammer blow in the shopping year’s busiest season.

And with the Christmas relaxation of socialising rules cancelled or severely curtailed, many consumers who’ve bought (or who’d planned to buy) fashion and beauty for the five-day Christmas window might now be rethinking their purchases. With no family get-togethers, this could be the most loungewear-focused Christmas ever.

What’s behind all this is the latest mutation of the coronavirus. Such viruses mutate constantly, but this one has made it much more contagious, even if there’s no evidence that it’s more harmful or vaccine-resistant.

The prospect has also been raised that much of the UK could be in tier 4 for months to come due to this new virus strain. At the moment, there are 16.4 million living under tier 4 rules in England and non-essential retail is closed for them, as it is in Wales. Stores will close in Northern Ireland for six weeks after Christmas too.

There are also nearly 20 million people in England living in a tier 3 area and if the virus is as transmissible as suggested, the current tier 3 rules might not be enough to stop it taking off elsewhere in England, as well as in Scotland.

For now though, the London/South east lockdown is going to hit some businesses disproportionately hard. Luxury labels tend to be concentrated in London, while fashion flagships are often found in key locations such as London’s West End and in malls like Bluewater, and the two Westfields. Selfridges, for instance, still has its Birmingham and Manchester stores open but its Oxford Street flagship is shut, apart from the food hall.

Yet while those businesses will suffer, they tend to have the financial resilience to continue, A large number of small businesses and already-struggling larger chains, by contrast, could be facing an existential threat.

While there’s a widespread acceptance in the UK that stricter measures were necessary, there’s also frustration at the on-again, off-again approach being taken by the authorities, and fear over the impact on jobs. 

The British Retail Consortium said the latest move could mean thousands more jobs are now at risk and said the “stop-start approach [is] deeply unhelpful”.

BRC chief Helen Dickinson said “the consequences of this decision will be severe” and highlighted how retail has worked hard to make stores Covid-secure.

“Faced with this news — and the prospect of losing £2 billion per week in sales for the third time this year — many businesses will be in serious difficulty and many thousands of jobs could be at risk,” she explained. 

Retail has been the worst affected by the Covid crisis of all industry sectors and Dickinson added that extra government must should be forthcoming.

Adam Marshall, director general of the British Chambers of Commerce, echoed that view, asking whether there would be “more help for firms being forced to shut their doors — and for those who have paid for stock they now can't sell?”