Boris Johnson’s statement to the nation on Monday contained good and bad news for retailers. The good news is that non-essential retail will be allowed to reopen from April 12 barring a reversal in infection and vaccination trends. The bad news is that this is several weeks later than some businesses had hoped for and that social restrictions are set to remain in some form until the middle of June.
Businesses at least now have a timetable for reopening which means they can begin assessing the implications for their workforce and put firm plans in place.
For those retailers whose ability to trade has been severely reduced during lockdowns the most pressing questions will be around future headcount requirements, both in stores and head offices. The government’s furlough scheme has allowed retailers to defer decisions about job cuts until now, but those tough choices about which staff to retain and in which functions will soon come to a head.
People that are brought back from furlough will need to be carefully reintegrated into the business. There are challenges here on both sides: furloughed staff may feel undervalued compared with those that have been retained and will need to be reassured of their importance to the business. Conversely, staff that have worked through the pandemic may feel resentful towards those they feel have been sitting at home on 80% pay. Senior leaders will need to manage these relationships with a deft touch.
For those retailers, like grocers, that have seen trade grow during Covid-19 the implications of reopening will be very different. We’re likely to see a drop off in grocery sales once the hospitality sector begins its own path to reopening meaning some staff recruited to help deal with unprecedented levels of demand may soon be surplus to requirements.
There may also be a need for employees that have been supporting online sales to be reallocated back to customer-facing roles once stores are able to fully reopen and consumer confidence has returned.
At a senior level, we should expect to see greater movement in the jobs market as recruitment decisions that have been put on hold during the pandemic are now acted upon.
With the hope being the current lockdown is the last, thoughts now turn to the task of rebuilding businesses so they can prosper in a new retail landscape. More than ever, boards will be looking for visionary leaders with a track record of delivering business transformation.
Attracting such leaders will be a challenge. Retailers whose structural deficiencies have been exposed by the pandemic may struggle to convince the industry’s leading talent to join a business whose short or medium-term future is uncertain.
Clarks, whose sales have been decimated by Covid-19, this week confirmed the departure of a number of senior executives including chief executive Giorgio Presca. Replacing them won’t be easy – people don’t want to be associated with business failure – yet there are those for whom the opportunity to deliver a renaissance is always appealing.
For a lot of smaller independent retailers starved of cash and soon to face the prospect of making rent and rate payments, April 12 may itself be too late to salvage the business. But we must cling to the hope that there is light at the end of the tunnel.
People that work within the retail sector are known for their resilience. Now is the time for all of us to show our resolve.