£7bn blow to Xmas shops

Tier Four shutdown will wipe out huge takings at festive peak for stores ‘hanging on by a thread’

HIGH streets in Tier Four face a £7billion nightmare after having to suddenly pull down the shutters at the busiest time of the year.

The huge sum could be lost in takings for the Christmas week through to the Boxing Day and January sales after new Covid restrictions were imposed.

It is feared thousands of stores ordered to close will never re-open, putting many thousands out of work.

The closure of non- essential shops, gyms, hairdressers, nail bars and department stores in London and the South East at midnight on Saturday after just a few hours’ notice has been a hammer blow.

Meanwhile Wales moved into a Tier Four equivalent yesterday and Scotland announced its own restrictions on Saturday.

Retail analyst Steve Dresser criticised the ‘zero notice’ and warned: ‘It’s sounding the death knell for our industry. End of times.’

Debenhams and Topshop, part of the Arcadia group, already have closing down sales and many others will follow suit. Bricks and mortar retailers, including John Lewis and Next, are having to switch the focus of Boxing Day sales online and even bring them forward.

The scale of the lost or delayed sales for physical stores could ‘sadly’ be up to £7billion, suggested Douglas McWilliams, deputy chairman of the Centre for Economics and Business Research.

‘This fortnight is big for Christmas and sale spending with £15billion of Christmas spending next week and £8billion of sale spending the week after,’ he said.

‘Some goes to supermarkets, some will go online. And some parts of the country are unaffected. But about £5-7billion will be at least delayed.’

The British Retail Consortium has estimated the loss of sales during a typical lockdown week are up to £2billion. The total for the weeks before and after Christmas would be likely to top £5billion.

Richard Lim, chief executive at analysts Retail Economics, also warned of the effects of Tier Four.

‘Thousands of retailers are hanging on by a thread, hoping to trade through these vital days before Christmas after months of disruption,’ he said.

‘It is essential that adequate government support is provided for an industry already on its knees. For many shoppers, a last-minute rush to order presents online will come too late as retailers struggle to cope with the volume of orders.

‘ Online capacity has already been exceeded for many retailers and a last-gasp attempt for some is likely to push operations beyond their limits.’

The British Independent Retailers Association criticised the closure of non-essential shops as ‘disastrous’. It called for support for small shopowners who will lose out as consumers rush to supermarkets and the few other stores, such as DIY warehouses, which can remain open.

Chief executive Andrew Goodacre added that ‘closing Covid-secure non-essential shops at this time of year does not deter people from coming out’.

He warned: ‘It only leads to larger crowds in those stores left to trade, giving every opportunity for this virus to spread.’

The British Retail Consortium has been accused by industry insiders of failing to use the rhetoric needed to spell out the true scale of the crisis.

After the latest closures, chief executive Helen Dickinson said: ‘This is hugely regrettable news.

‘ Retailers have invested hundreds of millions of pounds making stores Covid-secure.

‘The consequences of this decision will be severe. The Government’s stop- start approach is deeply unhelpful.

‘This decision comes only two weeks after the end of the last national lockdown and in the middle of peak trading.

‘Faced with this news and the prospect of losing £2billion 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.’

‘Last-minute rush online is too late’