The Retailer Winter Edition 2022

HAS COVID BEEN A SUCCESS FOR RETAIL?

Helen Dickinson OBE Chief Executive British Retail Consortium

If 2020 was a year of destruction, then 2021 was a year of reconstruction and progress. 2022 will put this to the test. Retail is back in the driving seat, or at least that is one interpretation of this week’s Retail Sales figures. Sales in 2021 were up almost 10% on 2020. Non-food up over 15%, illustrating a major reversal of fortune for thousands of retailers, although off a lower base in 2020. In 2020, we warned Government that without additional support, thousands of businesses, tens of thousands of jobs, and many millions in tax contributions would be at risk. The government heard our call: from loan schemes to rent moratoriums, and furlough to business rates holidays, the industry was given the support needed to survive. Yet it was also through the gargantuan efforts of retail colleagues that the industry was able to adapt. Aplethora of safetymeasures, changing consumer habits, and the rapid expansion of digital consumers, all had to be integrated into systems, processes, and strategies. In 2019, online accounted for 31% of non-food retail sales; in 2021, it was 47%. Five years of digital growth was crammed into 18 intense months. It took countless hours of building and improving websites, taking orders, loading vans, delivering around the country. New practices were needed for everything – from customer service to vehicle maintenance. And all this change and investment took place under the shadow of a pandemic that had spread all around the world. While we should all take a moment to pat ourselves, and our colleagues on the back, there are many headwinds in 2022. We all had limited options on how to spend our money in 2021, and will soon find ourselves with more choice, and less to spend. Eating out, travel, live music, and sports events, are all set to boom this year, pandemic backdrop allowing. Meanwhile, rising inflation squeezes retailers from both ends, increasing the costs of labour and materials while reducing consumer demand. Consumers must contend with higher energy prices, higher National Insurance contributions, and increased costs of living. The full costs of Brexit remain to be seen, with physical checks on many goods being applied from July. Our industry has a louder voice than we had in 2019 and we have collaborated more than we ever have. Labour shortages, the future of GB-NI trade, and the exorbitant cost of shipping, are all challenges we must face as a united industry. We must persuade the Government, as we did during the height of the pandemic, to back UK retail, and support us on these key issues, and to get out of the way when they need to. But we must also act together on the longer-term challenges we face. Take climate change. The retail industry and its supply chains account for almost one third of emissions associated with UK consumption. Our potential to improve the world we live in is enormous. Workingwith our members, the BRC launched the ClimateAction Roadmap in 2020, aiming to make the industry – including its supply chains - Net Zero by 2040. Given the gravity of the situation, one wonders why every retailer is not involved. Diversity & inclusion is another issue close to my heart, as one of the all-too-few female CEOs in the industry, and one that is important to so many retail CEOs who think we can do better. That’s whywe launched the Diversity& Inclusion Charter, supported by seventy retailers, who have pledged to take measurable actions to improve inclusivity in their businesses. Retail is a great British industry – accounting for around 5% of the economy, and around 10% of its workforce. The challenges it faces are huge, but the power we can wield to tackle them together is even bigger. The industry did incredible things by working together during the pandemic. Imagine what we could do if we put our minds together to tackle the future’s great challenges – from sustainability to diversity. Let’s make 2022 a platform for the next phase of the industry reinvention.

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Our industry has a louder voice than we had in 2019 and we have collaborated more than we ever have.”