Though the lockdown of last Spring was the right thing to do to keep people safe and flatten the curve, but it did a huge amount of damage to the economy. Canadian retailers saw a 26% fall in sales during quarantine and 40% of retailers had to close their doors.
Stores offering non-essential products and services such as clothing stores were the hardest hit, along with gas stations as people were no longer travelling. However those selling essential goods found themselves thriving and even experiencing surging sales such as in groceries, home renovations, alcohol and cannabis.
Canadian retailers have been slow to transition to on-line sales but the pandemic has forced them to adopt e-commerce techologies to try and keep themselves in business and as a result e-commerce sales have more than doubled year over year. Although it means that Canadian retailers face competition from others worldwide it also gives them the opportunity to expand their market share at home, especially if they sell niche products.
In 2021 it is likely that retail business will still suffer a bumpy ride. As we are seeing now there will probably be sporadic shut downs due to minor outbreaks but these are likely to be more regional. During this time retailers can expect sales to fall and they will have to deal with high labour costs and the costs of having to comply with health regulations but it is hoped that on-line sales will be a stop-gap solution to keep them in business.
The federal government is continuing to support businesses by extending the Canada Emergency Wage Subsidy program into 2021, coving 75% of employees wages for those that are eligible. This will help retailers to avoid bankruptcy and will give employees more disposable income to spend.
Even with these new ways of doing business and federal help it is unlikely that many in the retail sector will survive another major lockdown. However localized shutdowns will allow the majority of retailers to stay open and keep some revenue coming in until a vaccine arrives.
From an article by Ali Amad
Tips to Improve your Brand Strength
Small Business Loans for Women
Stay Alert and Recognize Signs that your Business may be in Trouble
Do Businesses Need Better Access to Rent Subsidies?
Paying Digitally? – Tips to Stay on Top of Your Finances
The Inevitable Second Wave – How to Prepare your Business
Business Continuity in a Crisis
Be Wary of Adding a Covid-19 Surcharge to your Business