Shopkeepers want the government to do more to get Brits back into their offices, warning that many shops will go under unless regular working patterns resume.
Helen Dickinson OBE, chief executive of the British Retail Consortium (BRC), said on Tuesday: “Unless businesses and government can successfully persuade office workers back into city and town centres, some high street retailers will be unable to afford their fixed costs.
“Government will need to act fast or September will see more shops close and more job losses realised.”
The stark message came despite figures from the BRC showing a continued rebound in retail spending. Sales grew by 4.7% in August compared to a year earlier.
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However, the growth was largely driven by online. Online sales of non-food items like clothing and electronics grew by 42.4% in the three months to August. Over the same period, in-store sales fell 8.5%.
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Paul Martin, UK Head of Retail at KPMG, which helped put together the report for the BRC, said there continued to be “mixed fortunes” among retailers.
“Not all retailers are where they should be at this point in the year,” he said.
Dickinson said clothing, footwear, and beauty businesses were particularly struggling.
“With rents accumulating, and the September quarter payment date fast approaching, many retailers are hanging on by a thread,” she said.
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Major High Street employers like Boots, Marks & Spencer (MKS.L), and Dixons Carphone (DC.L) have all announced thousands of job cuts and store closures in recent months, blaming diving sales. Takeaway chains like Pret and Costa have also announced thousands of job cuts.
While High Street stalwarts are laying off staff, online retailers are hiring thousands to deal with the surge in online ordering. Amazon (AMZN) said it will have hired 10,000 new staff in the UK by the end of 2020 and Tesco (TSCO.L) is recruiting 16,000 new employees to deal with a jump in online grocery orders.
“The vast majority of online categories realised significant growth in August,” Martin said. “Clearly, retailers have some serious thinking to do around what the future of the industry is going to be exactly.”