Has Covid Finished off the High Street?
It doesn’t take me to say that during the Covid pandemic shopping habits have changed. Retail sales for July have, according to Rauters (Davey, 2020) matched the figures for June 2019. According to the British Retail Consortium and KPMG, non-food sales saw a 48.2% increase for online sales for June 2020 over last year. However, Barclays (Partington, 2020) stated that non-essential high street spending fell by 22.3% and more than half of shoppers refusing to frequent shops..
The government scheme “Eat Out to Help” designed to boost and support the struggling hospitality industry have, Davey states, seen an increase in high street footfall of around 3.8%. The same article then goes on to state that most of this footfall occurs after 06:00 p.m
The Impact of the Internet and Covid-19
Spend on online shopping declined during August of 2019, seeing sales of around 1.33 billion. Since Coronavirus sales have jumped to an unprecedented 2.34 billion (Statista, 2020). It has even been claimed that Covid-19 has accelerated online shopping by up to ten years.
Online food shopping has increased by 105.9% for June 2020 compared to a year ago – though this would be expected given the circumstances. As shoppers get more comfortable buying online and hesitant to return to physical stores, internet shopping is likely to become the new norm.
As stated earlier, attempts to attract more diners seems to be working to some extent; however, many restaurants and cafes require the revenues that lunchtime trade brings in. Nowhere is this more true than in our major cities and, with more companies looking at working from home, coupled with reduced footfall and rising unemployment, you have an ailing hospitality industry which is likely to see many casualties.
The high street is expensive, fixed costs can be high, and you can lose money just opening your door for the day. High rates and rents all squeeze margins and between falling footfall and high costs sit the landlords.
Often landlords are getting pushed to reduce their rents or offer rent-free periods to give companies a chance of survival. If more retailers fail, then there is likely to be more unwanted properties coming onto the rental market. Inevitably this will hurt property prices.
Councils wishing to tackle congestion have squeezed the motorist out of the town centre. With parking fees being high and public transport not always convenient – try carrying a large package on a bus – push the motorist towards the out of town developments.
The British weather doesn’t help. Shoppers are less likely to make trips to our high streets in poor weather. Malls, with the cover they provide, seem a better bet on a cold winters day. Neither the mall nor out of town stores can compete with the comfort of your own home and shopping online.
So what is the answer?
So, what do we do with our high streets?
Fragmented ownership of land, attempts to reduce congestion and a commercial need for larger companies to expand, all work against developing a new model.
Developing high streets into community spaces would initially seem to be the answer. Having a mix of small independent stores, pubs, restaurants and cafes would be the current mode of thought. Utilising these same spaces for community activities and events could attract people back. Congestion could be addressed by encouraging greater use of bikes and pedestrian-only zones.
Remodelling shopping centres and malls for office space and housing seems to be a thing in the USA and could be one answer for our ever-increasing housing issue.
If shops are to make up any part of our high streets, then surely they need to be different than the offerings of current department stores?
To get footfall back, we need to entice shoppers. New shops need to offer new things, stuff you cannot easily buy elsewhere. Bespoke articles, craft made goods or locally grown and made foods.
Maybe, as some have proposed, it is time to allow our high streets to die and give in to the inevitable virtual shopping of the internet. After all, the internet can give space to both the small and large retailer, reduce overheads and costs and as technology develops, remove the need to touch or try on merchandise.
Let us know your thoughts and whether you have ideas to save our high streets?