Short-term relief, long-term concern: Independent retailers on the government’s Covid-19 measures

It has been three weeks to the day since the UK government announced the immediate closure of all ‘non-essential’ stores in a bid to slow the spread of the coronavirus, a move that, while undoubtedly necessary, meant certain and unprecedented distruption for businesses across the country.

To minimise the economical impact of the lockdown, the government has announced a number of measures to help retailers during the crisis, including business rates holidays and coronavirus business interruption loans (CBILS).

However, there is still confusion about how to secure such loans. A survey conducted by the British Chambers of Commerce earlier this month found that just one percent of respondents had succeeded in accessing the scheme from banks.

The government has pledged to guarantee 330 billion pounds of loans.

FashionUnited spoke to a number of independent fashion retailers across the country to find out how they are handling the current lockdown and how they feel about the government’s Covid-19 mitigating measures.

Deryane Tadd, founder of St Albans-based retailer The Dressing Room, said she welcomes the government’s support for small business during the pandemic, especially the extension of business rates holidays to all retailers regardless of their size, and its initiative to support 80 percent of wages for furloughed employees.

But she believes more still needs to be done. “VAT deferral is good, but I would welcome a VAT holiday for 2020, otherwise businesses will just run up a debt that has to be paid off in 2021, just prolonging the problem,” Tadd said. “My business is not eligible for the grant scheme, which feels unfair - we are still a small business but as this scheme is based on rateable value we cannot benefit from this as our rates are too high.”

Additionally, she said she would like to see the government put more pressure on insurance companies during these uncertain times. “We have business interruption cover for diseases and forced closure, however, because the policy doesn't mention Covid-19 specifically we are not covered - this is ludicrous and needs some pressure to make insurance companies do the right thing and payout on the policies.”

‘Highly at risk from going under’

Tess Grindle and Kate Heaton, owners of Manchester-based childrenswear retailer Our Kid, said the government’s business grant of 10,000 pounds that their company is eligible for would be “vital” to keep it from collapsing from rent costs, but that they are still facing a huge uphill battle. They said: “Even an established business like ours is highly at risk from going under. No matter which way you look at it, we will be massively affected by the pause in trading,” they said. “Finding the will to keep going will be our biggest challenge as a small independent retailer.”

They added that they are lucky to have experienced an uptick in sales from the retailer’s online site, “however with more and more of our suppliers furloughing their staff, the opportunity to re-stock dwindles by the day. The thought of our 7-year having to cease trading under these circumstances is heartbreaking.”

Their plan now is to “take advantage of every single piece of help that is on offer.” They said: “Whether that’s accepting mentoring from fellow retailers or furloughing ourselves. We are agile enough to respond quickly to each changing day. We just hope we can find the energy to do so.”

A spokesperson from Birmingham-based retailer Autograph said that while they were happy that the government had “stepped up and offered businesses some comfort”, they felt the measures were only “short-term” and that there needs to be “a quicker effort to get the cash to the people really needing it.” They also said they would like to see a VAT deferral. The spokesperson said: “Retail businesses like ours have to pay for SS20 stock and deposits for AW20/21, so there is a lot to worry about. The government needs to give us a clearer timeline about these benefits and loans.”

Alison Smith, the founder of Holywood, Northern Ireland-based jewellery and accessories retailer Red Ruby Rouge, also supported the government’s actions but said it needs to do more to protect smaller retailers and be more transparent about the actions it's taking. Smith told FashionUnited by email: “The UK government had to make some tough choices to protect the nation. This has definitely favoured amazon stores with sellers of mass produced items. The government should look to protect smaller sellers, for example we represent jewellery artists worldwide who handmake pieces and whose livelihood depends on selling their unique quality creations.”

Photo credit: Pexels, Artem Bali