LONDON — Clothing and footwear will bear the brunt of retail closures due to the coronavirus, with one-fifth of U.K. fashion spend to vanish in 2020, according to a new report from Global Data.
The market research and analytics company said Thursday that fashion sales in 2020 will be down 11.1 billion pounds compared with 2019, according to its preliminary forecasts.
Kate Ormrod, lead retail analyst at Global Data, said that amid a U.K. lockdown and self-isolation, “buying new clothes and footwear is far from a top priority for consumers, making spring a [fashion] season to forget for fashion retailers — but one with long-lasting consequences.”
She added that while retailers are “striving to entice spending with discounting, promotions rife and loungewear at the forefront of marketing campaigns, we expect these to have little impact at present as consumers acclimatize to their new daily routines.”
Meanwhile, worries about supermarket shortages will ensure that food shopping remains top of mind for most consumers.
April could bring a bounce due to the Easter holiday and the expected peak of the pandemic in the U.K. in two weeks’ time, according to Global Data.
Ormond said it was likely some consumers will want to treat themselves, especially if a lockdown extension is mooted, and urged fashion businesses to exploit the online channel and social media to keep shoppers engaged while their bricks-and-mortar operations are out of action.
“Brands need to foster support if they are to retain relevance when consumers begin spending on nonessential clothing and footwear again. [But] any notion that online sales will fully counteract those lost in-store is wishful thinking.”
She argued that the coronavirus’ impact has been swift. “Significant fallout across the fashion sector is expected this year as fundamentally weaker players fail to recover once demand finally picks up in the second half.”
Ormond’s advice to online retailers comes in bold contrast to the GMB union, which has begun waging an aggressive campaign, urging the likes of Net-a-porter, Matalan, Asos and Amazon to shut their warehouses which they accuse of being too crowded and endangering workers’ lives.
Emboldened by the British government’s promise of paying 80 percent of the salaries of workers on furlough, the union has sent out a series of patronizing, alarmist and ill-informed emails to the media just as the British Fashion Council, and other industry organizations, put together plans to protect fashion, beauty and luxury businesses.
According to the latest annual report from the British Fashion Council, the U.K. fashion industry contributes 32 billion pounds to the British economy.
Walpole, the lobby group for high-end British businesses across a variety of sectors, has launched the hashtag #BuyOnlineLuxury to promote members’ online shops while scores of beauty companies are making donations from online sales to help Britain’s National Health Service workers, or donating soaps, sanitizers and care packages to hospitals.
Those goods don’t pick and pack themselves. In addition, the British government said in its latest update Thursday that online retail is still “open and encouraged,” while postal and delivery services will run as normal.
In one e-mail, GMB accused the online fashion retailer Asos of “playing Russian Roulette with people’s lives,” by keeping its warehouses open for business.
Asked for a comment, an Asos spokesperson said the company “totally refutes” the allegations made by GMB.
“They are false, do nothing more than serve to create panic and hysteria in an already uncertain time, and are part of a continuing campaign against us and the recognized union on site, Community. It is simply not true to say we aren’t enforcing social distancing and it is not true to say that we have thousands of employees working under one roof,” the spokesperson said.
“The reality is we currently have around 500 colleagues working in our 680,000-square-foot facility at any one time and we have strict social distancing protocols in place but, it must be said, it is also our colleagues’ responsibility to adhere to them. As directed by the [British] government, we, along with other online retailers, are ensuring we are striking the right balance between keeping our warehouse operational, for the good of our employees and the wider economy and maintaining the health and safety of staff, which is always our number one priority.”
In a separate letter, the union accused Net-a-porter of “putting fashion before lives by refusing to shut its Charlton, South London, warehouse. GMB organizer Mary Stump said Net-a-porter “insists on putting the whims of customers before the safety of their workforce.”
On Thursday, Net-a-porter said in a statement that the health and wellbeing of its colleagues are a first priority. “We will be temporarily closing our London warehouse in line with similar temporary closures we have made in Europe and the USA, until further notice.”
The Net closures are understood to have been planned in stages and are not in response to bullying from any union.
Following an order issued by New Jersey Gov. Phil Murphy that applies to most businesses in the state, Net has temporarily suspended activities in its local distribution centers there and is understood to be looking into alternative ways to serve customers.
Both Amazon and Matalan refuted GMB’s claims that they were endangering employees.
Amazon said that “as the COVID-19 pandemic continues, the company and its network of partners are helping communities around the world in a way that very few can — delivering critical supplies directly to the doorsteps of people who need them.” It said it was prioritizing deliveries of food, health and personal-care products, books and items needed to work from home.
The U.K. division of the online giant said it has implemented proactive measures “at all of our facilities to protect our people, including increased cleaning, and maintaining social distance, including between drivers and customers when making deliveries.
It has also increased entitlement to paid time off and is enabling people to take a leave of absence, as appropriate. It said it would be adding an additional 2 pounds per hour worked from now through to the end of April, and has increased the overtime premium by 100 percent of the hourly base rate for every overtime hour worked above 40 hours in a workweek, between now and end of April.
A Matalan spokesperson said it was operating its online business and closely following the British government’s guidance, “going above and beyond to ensure the safety of both our employees and our customers.”
The mass-market retailer, online and catalogue company said it is “taking its responsibility” as a large North West England employer to look after staff and customers “extremely seriously.”
Even beauty companies are forging ahead with their online businesses: Trinny London, the color cosmetics company said its London warehouse is “strictly adhering to” U.K. government and WHO guidelines, with employee welfare prioritized.
It said that enhanced cleaning measures are in place, while staff are wearing gloves and masks. The digital native business has also canceled all in-person makeover appointments.