• Home
  • News
  • Retail
  • In Italy, 70,000 stores at risk of closing

In Italy, 70,000 stores at risk of closing

By Don-Alvin Adegeest

20 Apr 2021

Retail

Image credit: Pexels

The heart of Italy’s fashion sector is its once thriving independent retail businesses, where boutiques in even the remotest village offer the latest fashions and a unique mix of multi-brands. But one year into the pandemic the devastating impact of store closures and restrictions see Italian retailers dealing with one of the highest closure rates in Europe, with an estimated 70,000 stores are risk of permanently shuttering.

Figures from Confesercenti, an organisation that supports retail businesses, show sales in large retailers and small boutiques fell 3.8 and 10.7 percent respectively in the first two months of 2021, while online sales grew by 37.2 percent.

The growth of e-commerce marked an acceleration that started last October, when the measures adopted to counter the second and subsequent third wave of contagion led to losses in all traditional sales channels.

The shift to online shopping has greatly impacted Italy’s brick and mortar businesses.

“The restriction measures, due to the ways in which they continue to be implemented, are determining a structural and non-governed redistribution of the sales shares towards the online channel,” said Confesercenti. 35,000 businesses located in shopping centers and galleries are facing some of the greatest risks. Regulations to close at the weekend, which for many retailers represent 40 percent of their takings, is damaging the sector, Confesercenti said.

In a letter addressed to Italy’s Prime Minister and the Minister of Tourism, the associations of commercial activities of the historic centers of the cities of art (Via Condotti Association, MonteNapoleone District Association, Piazza San Marco Association, Ponte Vecchio Association) ask for economic support that account of the fixed costs incurred by companies that have seen turnover fall between 65 and 70 per cent.

Furthermore, Italy’s clothing exports also collapsed. On the basis of ISTAT data for February, clothing items, including leather and fur, recorded a decline of 10.9 percent on an annual basis.

CORONAVIRUS
Italy