Last Updated on Thursday, 3 December, 2020 at 12:23 pm by Andre Camilleri
Walking through Malta’s prime shopping areas such as Valletta or Sliema, you’d be hard-pressed to believe both are usually bustling shopping destinations, let alone the fact the December peak shopping season is upon us. The Christmas lights glittering in the background remain the only essence of normality; the situation is desperately surreal.
This week the world of retail was hit with the shattering news that Philip Green’s Arcadia Group went into administration taking 13,000 jobs along with it. Furthermore, this week we also witnessed the collapse of Debenhams UK and an added 12,000 jobs in peril. Each one of those job losses is a personal tragedy for the individual worker and store closures are scarring our high streets and communities. Arcadia UK state they will continue to honour all online orders made over the Black Friday weekend and will continue to operate all of its current sales channels – it’s not clear what the local implications are for our islands.
But we must accept the reality, the world of shopping as we know it has changed. In a post-Covid-19 world, some shops will never pull up their shutters again. An immense loss of sales has never been witnessed previously, even before adding in overheads such as rent, stock and staff costs. Longstanding British retailers Oasis, Cath Kidston and Warehouse have all suffered a similar fate. In contrast, others, including John Lewis, have warned they may scale back operations, and last month global giant H&M announced the closure of 250 stores next year. Those that continue to open their doors will find trading tricky while navigating restrictions. For a very long time to come, shopping will never be normal.
Long before the pandemic, bricks and mortar retail were knee-deep in trouble from all angles: fierce online competition, flat wages, greedy landlords, financial engineering. Many have vanished over the past few years, taking thousands of jobs and leaving many high street shopping hubs barren.
In this post-lockdown reality, online retailers are destined to be even more dominant and our high streets even more desolate. One consideration is that as the government faces a considerable drop in business taxes and rates; will they hike up fees for online services? Another is that many suburbs, communities, towns and villages will become increasingly soul-less places.
The days of the commercial landlord and clone shops sprawling across our islands are in low supply. It’s time for an industrial strategy to help a sector that was already struggling before the global coronavirus emergency. Consumer behaviour has been forced to change and this will undoubtedly force older customers to embrace new technology.
As we start to see a phased reduction in lockdown controls, this could result in stores beginning to open overseas, but without a large proportion of regular customers wanting or being able to return. The retail high street has always been evolving, but its response to the pandemic will be more crucial than ever if it is to survive in any recognisable form- before we ask the inevitable question, will we have a high street next year?
