Covid-19: Retail feels crunch as confidence ebbs

Retail businesses across Greater Sydney are beginning to feel the crunch, with fewer shoppers and deflated consumer confidence causing more uncertainty than in 2020.

‘Customer confidence has fallen away,’ says Grant Hilliard, owner of Feather & Bone Providore in Sydney’s Marrickville. Picture: Jane Dempster

With Sydney’s lockdown in its third week, retail businesses across the greater metropolitan area are beginning to feel the crunch, with fewer shoppers and deflated consumer confidence causing more uncertainty than in the worst days of 2020.

The Australian Retailers Association last week warned the NSW government that businesses in the Greater Sydney region were at tipping point, estimating retailers could loose up to $1bn in trade for every week of lockdown.

The peak body also said retailers who performed strongly during the March-April 2020 lockdown were no longer seeing the same results and needed ­urgent support.

“Last year, there were retail businesses that benefited from the lockdown, and we were certainly one of those,” said Gleebooks manager James Ross, who recently set up a click-and-collect kiosk out the front of the inner-city bookstore.

“Despite the drop in footfall, books continued to do a roaring trade throughout 2020, because people knew they needed to stock up for an extended period.”

This time, Mr Ross said, lockdown uncertainty was crippling the local bookstore, with customers choosing to sit tight until the lockdown ends. “This time it’s different. We’ve turned on the lights, hoping to show people we are still open for business, but it doesn’t seem to be having the impact that it did last year,” he said.

“What we are experiencing now is worse than 2020, where we saw strong sales, but without business support things will continue to look very dire.”

While the NSW government announced grants between $5000 and $10000 for small business, Mr Ross said they did not go far enough. “The government will need to seriously revisit the JobKeeper scheme if many of these retailers are going to survive and if we are going to deal with the ­uncertainty.”

Sydney butcher Grant Hilliard, owner of Feather and Bone Providore in the city’s inner west, said the current lockdown posed the biggest challenge retailers had seen since the beginning of the pandemic.

While last year’s lockdown caused Sydneysiders to stock up on meats and fire up the barbecue at home, Mr Hilliard said that trend was beginning to wane.

“We’ve still seen strong sales in recent weeks, up by about 30 per cent, but that is starting to die away. In the last lockdown, people were stocking up large … it was quite manic and there was a clear bump in sales. “People were happy to buy good meats for home, but the general uncertainty of this lockdown means customer confidence has fallen away.”

Gym gear proved another boon for retailers in 2020, with restrictions encouraging people to buy big and invest in home exercise equipment. Dean Piazza, the founder of Sydney’s Home Gym Equipment, said business had since quickly dried up.

“We had an avalanche of calls and orders last year, delivering more than 50 treadmills a day … people were keen to build their own home gym and keep fit.”

However, he said the continued lockdown uncertainty meant no one was prepared to buy like they did in 2020. “We were one of the lucky retailers who did well,” he said.

“People wanted to stock up and buy items for their homes during lockdown. Now people are worried and uncertain – they don’t want to treat themselves. ”