The curtain may fall on more than 20,000 British shops, even after the confinement is lifted. The Centre for Retail Research even fears that a quarter of a million retail jobs will be lost for good.
Already planning closures
As all British non-essential stores were forced to close as part of the confinement measures to halt the spread of the coronavirus, retail experts fear that many of them might never open their doors again. The coronavirus pandemic may be the final blow to many retailers who, even more so in the United Kingdom than in the Benelux, already were on the edge of collapse.
The Centre for Retail Research (CRR) has calculated that 20,620 stores may have been closed permanently by the end of 2020. This represents an increase of 4,547 stores compared to 2019 – about a third more. As a result, and also due to cost savings in other stores, 235,714 retail jobs will be lost after the corona lockdown, FashionUnited quotes the CRR report.
Large retailers are already planning these closures, says Professor Joshua Bamfield, director of CRR: “We expect large retail businesses to now be looking at exactly how many stores they expect to operate in 2021 and beyond in order to trade successfully moving forward. They will now make plans to achieve those objectives.” Unfortunately, some Scandinavian chains are already proving this scenario to be true.
Government support does help
However, there are some encouraging signs: the government support measures will significantly reduce the number of shop closures and redundancies, Bamfield thinks. For example, retailers are exempt from business rates this year and a system of government credit and loans has been set up.
Also, according to the CRR, the recovery after the lockdown might take the form of a moderate V-curve, with a possible “splurge in cash” towards the end of the summer. However, it is not clear whether the report takes into account the expected extension of the isolation measures. Moreover, experts from the OECD have previously indicated that such a V-curve with a rapid recovery is probably far too positive an estimate.
