How should non-essential retail businesses be reopening?

Non-essential retail, along with hairdressers, spas, gyms, outdoor attractions and pubs with beer gardens can reopen today (12 April), marking the second stage of the Government’s roadmap out of the lockdown. 

The retail sector in has been one of the worst-hit during the pandemic. According to data from the Centre for Retail Research nearly 190,000 UK jobs lost since the first lockdown in March 2020. Research from the British Retail Consortium revealed that non-essential retailers lost over £22bn in sales during the pandemic.

But green shoots are starting to appear: recruitment company Indeed revealed that retailers are re-hiring at rates close to pre-covid levels, in preparation for the sector reopening.

To encourage more footfall back onto the high street and help boost sales, Communities Secretary Robert Jenrick announced last month that retailers will be allowed to extend their opening hours to 10 pm Monday to Saturday.

Retail businesses have been gearing up for reopening ever since the roadmap out of lockdown was first announced earlier in the year, but from a logistical and financial perspective, it won’t have been a straightforward process.

How should businesses prepare for reopening in terms of supply chain management and cash flow?

Ensure retailers have enough stock and staffing levels to deal with demand

John Miller, chief operating officer, Addition

During lockdown, many of our retail clients have been making deals with landlords for rent and rates holiday,furloughing staff and reducing all other costs to nil. Others have been trying to sell products online as much as possible as well as taking out government loans.

In preparation for reopening, our clients have been making sure appropriate Covid measures are in place. It’s likely there will be high demand when lockdown ends, so retailers should look to restock as much as possible on credit (on long repayment plans). This means that the retailer can satisfy demand if it really peaks whilst not using their cash to do so. And if the demand is not there, they can return the stock and no cash has left their account.

Next steps: We’re recommending the following to our retail clients:

  • Ensure you have the right stock and staff levels to deal with demand. If possible, ascertain expected demand by using online booking systems.
  • Cash in on new online customers acquired during lockdown, making sure they’re aware the retailer is now open and what is on offer.
  • Offer loyalty schemes and discounts to bring in cash now to help fill up the bank balance and get cash in the bank.

Verdict: Retailers should ensure they have enough stock and adequate staffing levels to deal with demand.

Retailers are scrambling to prepare in time amid concern over future lockdowns

David Fort, managing partner, Haines Watts Manchester

The overnight shift to work-from-home represented a shift for many of our clients when the pandemic first hit. Some of them had to scramble to provide their workforce with the tools necessary to login remotely, others were forced to furlough staff and close their doors in the haze of uncertainty.

Retail business owners are trying their best to get through this and organise things, but they still have this inherent uncertainty there might be another wave and everything could be shut again.

While the Government has extended furlough to allow those in the retail sector to keep the staff, they are going to need as we exit this pandemic, many of them are frustrated with the time it is taking to get their hands on grants and funding.

The Government’s staged process does seem to be causing frustration because of a lack of clarity.

Next steps: Businesses are needing quick and dynamic support, ideally, something they can control themselves, such as the furlough scheme or no longer having to pay VAT or Corporation Tax.  

Verdict: Retailers are finding form-filling for various grants and funding a challenge and have a lot to prepare for, while also worrying about having to shut again following future waves.

Spend time reviewing business processes to improve efficiencies

James Howard, Partner at Haines Watts

The resilience and innovation of our non-essential retailers never cease to amaze me.

Many of our clients have had to adapt to offer new services, such as click and collect or selling their products through more online channels.

They have also relied heavily on government grants and the furlough scheme has been

invaluable for giving them space to reshape their businesses.

One of the biggest challenges our retail clients have come up against has been whether or not to keep staff on that are on furlough or make them redundant. There is a lot of uncertainty out there, and none of us really know whether footfall will return at pre-pandemic levels or if we will face further lockdowns.

For companies that have gone out of their way to protect staff and keep them on, you would imagine that retained employees would be even more motivated to help with the recovery.

They should be using any excess monies received, over and above what they have had to use to pay employees and suppliers, to get their businesses ready for the return of

customers. This includes investment in PPE, screens and cashless payment systems for example, as this will be the ‘new normal’ for a while to come yet.


Next steps:  We have been advising clients to use the time before reopening to really look at their business. Whether this is exploring new ways of doing business or the systems that are being used. Anything that will improve efficiencies and enable the retailer to come out of this and hit the ground running.

Verdict: Retail clients have showed a lot of resilience and innovation during a difficult time. Now they need to use the time to review existing business processes and strategies to improve efficiencies and make sure they can respond to demand.

Plan, budget and review all business costs and outgoings

Beverley Wakefield, of Duffield Road-based Vibrant Accountancy

There have been great examples of businesses diversifying and finding innovative ways of attracting customers. Some have provided online experiences supported by a physical presence and others have offered a mix of new services and products.

In terms of preparation for reopening, business owners should budget and plan for their business and themselves. They need to review all costs and ascertain they’re getting the right return on investment.

Know the ‘pinch points’, too: businesses should be aware when funding is needed, and when they need to drive more revenue to create new sales targets.

It’s important to note that businesses don’t tend to fail on the way into a recession; they fail on the way out, so make sure as a business you’re starting on the front foot: cash rich rather than cash-starved, so make use of government support and continue to budget and plan for all outgoings. It’s all about the cash – cash is king.

Next steps: The various government grants which have bene a lifeline for many are also taxable, so remember to plot in when your corporation tax will be payable. Also factor in when you need to pay your ongoing VAT, plus anything else that you have deferred to pay at a later date.

Verdict: Re-start on the front foot by reviewing all business costs, being aware of pinch points and making use of funding

Picture note: the photo with this article is a library shot of a store in the Primark chain, which was a popular destination when shops re-opened.

Annie Makoff is a freelance journalist and editor.

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