Is retail in need of therapy?

Retail remains the single largest private sector employer in the UK, with one in 10 people working in retail and with annual sales of £354bn.

Despite the alarming media headlines on the demise of the British high street, online sales still only account for 17% of total retail sales in the UK, according to the Office for National Statistics.

All retailers, no matter the sector in which they work, face day to day challenges and burdens on their business.  These can include inflexible leases, high rents, and excess properties.

While every sector has been affected by COVID-19 in some way, the retail industry has experienced one of the most dramatic shifts of all.  

Many of the consumer behaviour trends have moved to online shopping, with the rapid move away from cash payments. This was well documented even before the first pandemic lockdown.

COVID-19 has simply accelerated this trend to online shopping, with public health messaging advising against handling cash.

Many retailers have set up an online shop, so are in a good position to capitalise on this widespread shift to buying online.

After months of coronavirus closures, non-essential retailers that reopened on 12 April can trade from 7.00am to 10.00pm, Monday to Saturday. This should help businesses to recover and allow customers to shop safely and avoid peak times, easing pressure on transport.

Retailers have invested hundreds of millions of pounds in making their stores COVID-19 secure, implementing additional hygiene measures, installing perspex screens and enforcing social distancing.

Government support

The government has approved a £56M “Welcome Bank Fund” to support businesses to reopen and recover. This will provide a much-needed boost for many businesses, protecting jobs, reducing pressure on public transport, and supporting people and communities to continue to visit their high streets safely and shop locally.

Also, good news for some retailers if they wish is that they will be allowed to stay open for 24 hours a day in the run up to Christmas and in January.

Retail businesses have shown a lot of resilience and innovation during a difficult time.  Now they need to use the time to review existing business processes and strategies to improve efficiencies and make sure they can respond to demand.

Further help available

If your business requires a review and some possible restructuring in order to be more effective and efficient, please contact our Restructuring Team for a conversation. You can also check out our articles and guides in our Restructuring Knowledge Hub.