The Guardian view on post-lockdown retail: low spirits on the high street
Rarely does a cabinet minister salivate in public over fast food but on hearing yesterday that chicken chain Nando’s is reopening dozens of branches, Rishi Sunak could not stop himself. “The good news we’ve all been waiting for,” the chancellor tweeted, his jauntiness somewhat out of place with a thoroughly bleak situation. He may hanker after a peri-peri hit, but the government hungers for something else besides: for normal life to resume, complete with its high-street staples. One way Boris Johnson sought to leaven his terrible week was to announce the reopening next month of all “non-essential” shops. Leave aside the dangers of doing so without anything like a mass test-andtrace regime in place, and the prime minister is still likely to be sorely disappointed.
Some shops will never pull up their shutters again. By the time the retail lockdown ends, most will have been closed for 12 weeks, costing the industry over £21bnin lost sales, even before adding in overheads such as rent and staff costs. Longstanding retailers Oasis, Cath Kidston and Warehouse are all shutting down, while others, including John Lewis, have warned they may close branches. Those that do open their doors will find trading tricky. Clothes boutiques may not offer fitting rooms, bookshops may discourage browsing and all will have to maintain a decent distance between customers. For a very long time to come, shopping will not be normal.
Even before the pandemic, bricks and mortar retail was in deep trouble from all sides: online competition, flat wages, greedy landlords, financial engineering. Mothercare, Jessops, BHS – these and so many others have gone over the past few years, taking tens of thousands of jobs and leaving many high streets desolate. Covid-19 and its historic recession will hasten and deepen these trends and the result promises to be both an economic and social disaster. Another vast cull of retail jobs looms and, as Wednesday’s billion-pound loss at British Land shows, commercial property owners are in for a huge hit with their portfolios of shopping centres and office blocks plummeting in value. The past couple of months have taught us all the acronym WFH – but we should also be talking about SFH: shopping from home.
In this post-lockdown world, online retailers are likely to be even more dominant and high streets even more barren. One upshot is that central and local government face a huge drop in taxes and rates. Another is that many suburbs, towns and villages will be sadder places. Beyond shopping and eating out, high streets fundamentally provide a focal point for communities.
As with many other spheres of postlockdown life, it will eventually fall to government, in both Whitehall and town hall, to pick up the pieces. One immediate task for Mr Sunak’s Treasury will be getting online retailers to pay more in taxes. Another job for councils and government will be how to make high streets more resilient and diverse, by taking them beyond shopping and encouraging local independent businesses (including social enterprises) on to them. The days of the massive commercial landlord and the clone town of the usual brands are numbered. Building a replacement will require more public intervention and tax breaks for those firms who employ and procure supplies locally. It will not be easy, but it is a huge opportunity.