Express & Star comment: Retailers must have long-term view on return to normality
Slowly, we are taking the first steps back to a new type of normal.
Shop owners have been given the clarity that they require in order to get back to business. Not that many have been idle, of course. Vast numbers of retailers have spent recent months developing new, online markets. They have integrated websites with reliable delivery systems so that people can make purchases from home. Though they may not have the might of such colossal market leaders as Amazon, their forays into the digital world have allowed them to generate revenues, avoid debt and stay afloat.
The effects of lockdown have shifted. When retailers first closed, the key question was cashflow. Did their businesses hold enough cash to pay bills and stay afloat? Now that surviving businesses have answered that question, the key question shifts. It is whether or not there is sufficient demand for products. We are in a different place where ingrained habits will not immediately re-emerge. It may take time for people to gain sufficient confidence to shop. There will be those who continue to shield because of underlying health conditions. The elderly are part a key demograph that may decide not to return to our High Streets until Covid-19 is sent packing. And who could blame them. Certain sectors of society are more at risk than others and though the infection rate is now less than one, there are still risks and people should not be foolhardy.
We are in this for the long haul. Economist Professor Nouriel Roubini, who foresaw the 2008 financial crash, has warned that there will be a prolonged downturn and sluggish recovery with a risk of a greater depression. He has warned people not to expect a quick bounce-back to the way things were at the start of the year. There will be job losses in all sectors of the economy, increased job insecurity and lower incomes for many.
We can look to other parts of the world for examples. In China, the shopping centres have re-opened but though the lights are on, many remain empty. In the UK, it is clear that retailers will have to take a long-term view. They should not expect an immediate return to strong levels of profit. Patience, adaptability, tenacity and perseverance are key. Stores must innovate to survive. We can play our part by supporting them when they re-open.