Whilst it would inappropriate to directly compare the gravity of that situation with now, if we are going to mend the UK’s economy today then a lot of the challenge will have to be met domestically on our ‘Home Front’.
For example, the shops of London’s West End have been heavily reliant on international tourist spend which accounted for more than 50% of total retail sales last year. The easing of lockdown restrictions will be gradual but if retailers are going to get some respite it will have to be in the form of domestic spending.
Accordingly, London will need to look at how it can woo people back into the capital.
Clearly, any measures cannot be antagonistic to the precautionary measures still in place to counter the pandemic. However, there will have to be something done proactively if shoppers – many of whom have become very comfortable with online retailing in the past two months – are to start repopulating our famous shopping streets.
Some pundits believe that as the lockdown eases there will be a spike in ‘real life’ shopping as people enjoy greater freedoms of movement but this phenomenon is likely to be short-lived and tempered by the harsh realities of increased unemployment, wage cuts and poorer job security.
Non-essential shops may be able to open as early as 1st June as part of the government’s new “road map” to reactivate the economy. There will, however, still be challenges getting into the West End as we are discouraged from using public transport which must remain at 10% capacity to run safely.
Both the Government and the London Mayor's office should therefore be looking at positive action to make it easier and cheaper to get into the capital (Accessibility); to provide some monetary incentives for shopping in town (Financial); and also allow retailers more flexibility to suit shopping hours to the new situation in which we find ourselves (Regulatory).
We welcome pop-up bike lanes and the fast-tracking of e-scooter trials, but clearly the government will need to go much further with a raft of immediate and long-term initiatives. Proposed measures could include:
- Legalise electric scooters and bikes – legalisation is needed as soon as possible to bring the UK in line with major EU countries such as France and Germany. New York has also recently legalised and plans to invest in new scooter lanes.
- Cycle Lanes – major investment in “Smart Cycle Lanes” which have been pioneered in The Netherlands.
- London Transport – once social distancing measures are eased, fares to be free of charge from Zone 6 into Central London after 10am.
- Pedestrianisation of Oxford Street – this is an opportunity to look at the proposals again and re-engage with residents and major stakeholders to make this happen.
- VAT – 100% VAT exemption on in-store purchases to compete against the rise in online shopping habits during lockdown.
- Coupons – the Chinese government is using a voucher system to stimulate shopper spending. Vouchers can be redeemed if you spend a certain amount at a participating retail and leisure businesses for a limited period of time.
- Business Rates – a wholesale restructuring of the system must now be an absolute priority.
- Sunday Trading Laws - extend opening hours to encourage footfall whilst keeping it at manageable and safe levels.
The road ahead is rocky but with creative policies and occupier resilience London can weather the storm and once again become one of the most exciting places to shop, eat and drink in the world.
If you are an occupier of a retail property and would like to discuss lease strategy, please contact:
Peter Flint - Co-Head of Brand Representation
Central London – Retail Agency