UK retail: Post-lockdown performanceBy Will Lord on August 6, 2020
To the delight of the nation's shoppers, the vast majority of UK high street stores opened their doors again on 4 July, after nearly four months of lockdown.
A month has since passed; a month that saw face coverings become compulsory and the reinforcement of stricter lockdown rules in cities such as Leicester and Manchester. So let’s take a look at some of the emerging post-lockdown retail stats, and examine how businesses are faring in the new normal so far…
It was calculated that average high street spending on 4 July was double that of the previous Saturday. Shops across the UK were once again bustling with crowds of people, and no longer resembled a bleak, eerily quiet ghost town.
It was a triumphant return for physical stores. The high street was at 86% capacity of pre COVID-19 levels, as people left their houses and tried to add a small sense of normality back into their lives. This resulted in a 13.9% jump in overall retail sales from May to June.
Unsurprisingly, one of the biggest attractions in cities across the UK was the reopening of barber shops and hairdressers. This sector saw the biggest jump in spending, experiencing a huge 23% increase compared to a normal pre-pandemic Saturday.
Pubs naturally also saw huge increases in spending, up 91% from the previous weekend. However this was still only half the amount expected to be made on a normal weekend before the pandemic. Social distancing guidelines and limitations on capacity mean that such venues are unlikely to achieve the same financial success as they would have before lockdown.
Since the first weekend boom, growth afterwards has been hard. Online retail has continued to dominate the market as of late, as online retail spends reached a record high during lockdown – accounting for a total of 32.8% of total retail sales. It could stay that way for a long time to come. Since lockdown began, e-commerce penetration of the retail spending market has risen from 16% to 40%. Retailers like Hotel Chocolat saw a 200% rise in their digital sales during the lockdown period.
Footfall is still increasing slowly, but the numbers are tapering off somewhat. At the time of writing, we’re still lacking some concrete statistics to identify the impact of wearing masks and how this will further affect people’s desire to go to high streets. That said, word on the high street is that retailers have been pleasantly surprised since ‘Face Mask Friday’ kicked into gear.
From an e-commerce perspective, due to the steep increase in the volume of online orders and to try and help physical stores compete, Chancellor of the Exchequer Rishi Sunak is said to be considering a 2% online levy tax that could raise £2 billion for the struggling UK economy.
How will the high street survive in the long run? We’ll wait and see, but online retail is king at the moment and it may be the dawn of a new era for retail worldwide.
If you’ve enjoyed this blog highlighting the impact of COVID-19 on high street shops, then take a look at our other retail and COVID-19 related articles below 👇