Surge in local retail spending as high street hit by COVID-19

News
04/06/2020

Consumers have looked to support independent retailers during the COVID-19 crisis, with spending at local off-licenses, greengrocers and convenience stores rising 40 per cent in April, according to business advisory firm Deloitte.


In addition, 46 per cent of consumers suggested that they are motivated to support local businesses as individuals develop a strong sense of community spirit and resilience during the pandemic.


This positive outlook comes despite largely negative national sales statistics for the high street. The latest Office for National Statistics (ONS) retail sales report revealed that British retail sales fell by a record 18.1 per cent in April, with clothing sales falling by more than half. The long-term prospects also look bleak, with estimates suggesting that FY21 will remain nearly 20 per cent down on levels seen in 2019.


In Greater Manchester, analysis from Deloitte, in partnership with Google, revealed that retail and recreation activity fell by 68 per cent in April, with time spent at home up by nearly a quarter as lockdown took full effect.


As part of its study on the high street, Deloitte has identified five key impacts currently being faced by the sector: supply chain agility; an increased focus on direct to consumer delivery models; low liquidity; delayed shipping on seasonal offerings and emerging capital expenditure freezes.


Simon Bedford, partner at Deloitte in the North West, said:

“The retail space has certainly been one of those most affected by the global pandemic, with previously bustling high streets becoming eerily quiet across the UK. While it is unsurprising to see the latest sales statistics, it is important to remember that out of adversity comes opportunity, and consumers have instead used this time to foster a sense of community spirit and support local retailers.

“As we look to build back better, the challenge will now be for local authorities, working in partnership with businesses, to get our high streets back open again, as well as ensuring that the localised support we have seen during lockdown is continued once major retailers return.”


Caroline Simpson, corporate director, place at Stockport Council, said:

“It is important to remember that the struggles of the high street is not something that began with COVID-19 – it is something that has been happening for a number of years. In this context, a period of rapid restructuring may not be a bad thing and will enable us to create more sustainable high streets both in the major cities and local towns.

“A major positive we have seen is a local swell of support and sense of community, with people walking to their local independent shops and supporting their vulnerable neighbours. This is a crucial element of our long term vision for Stockport through our “Shop Local, Think Local” campaign, which we hope will have a lasting effect for years to come.”