Sector Focus
Online fashion giant acquires Debenhams
Online fashion retail giant Boohoo for bought the Debenhams website and intellectual property assets for £55m. But the deal does not
include the purchase of the high street retailer’s remaining 118 department stores across the country, with up to 12,000 jobs at risk. Debenhams went into
administration last April, and started the liquidation process in December after failing to secure a rescue deal. The historic 242-year-old
firm will now operate as an online-only retailer. Boohoo has said that it will relaunch Debenhams’ online offering next year. Boohoo chief executive John
Lyttle said: "The acquisition of the Debenhams brand is an important development for the Group, as we seek to capture incremental growth opportunities arising from the accelerating shift to online retail.”
Retail
Chancellor ‘misses chance to tackle business rates’
Chancellor Rishi Sunak missed a ‘golden opportunity’ to tackle business rates reform or a business rates holiday for retail, hospitality and leisure sectors in his economic update last month. That’s the view of John Webber,
head of business rates at Colliers International, speaking after Mr Sunak made the update in the House of Commons, where he told MPs that the economy will ‘get worse before it gets better’. Research from the British
Chamber of Commerce confirmed that the restrictions caused by the latest national coronavirus lockdown will put the country on course for a double-dip recession in the first quarter of this year. And the Federation of Small
Businesses has said at least 250,000 UK small businesses are set to fold without further help from the government. Mr Webber said: “We are in dire
times and the chancellor did not deny this. Our economy has shrunk 6.1 per cent from before the crisis and 800,000 jobs have been lost since February. And the chancellor
John Webber: Chancellor has his ‘head in the sand’
spelled out that it will get worse before it gets better.” Mr Webber said that one area
the chancellor seems determined to ignore are business rates payments still hanging over heads of the distressed retail, hospitality and leisure sectors. Businesses in the sector are
expected to pay around £12bn in business rates from April if there is no extension of the current rates holiday.
Colliers estimate that non-
essential retail and the restaurant and hospitality sector, currently closed due to lockdown, will need to find around £10bn to meet their business rates liabilities from the end of March. Mr Webber says that this is ‘totally
infeasible’ for many businesses. He said: “The Government’s latest grant schemes are all very well, but we are hearing that to some extent they are a post code lottery - with some boroughs processing grants at much greater speeds to others- and some local authorities have not even started yet. The position on state aid restrictions has also not been confirmed, so many businesses are unsure of what they can claim. “While we welcome the financial
support for businesses through the grants system, we ask the chancellor for some clarity going forward - both in terms of state aid restrictions and business rates reliefs post March 2021. It is disappointing that yet again he has missed a golden opportunity to tackle this issue and has put his head in the sand that all will be OK in the spring.”
Bira makes rates plea
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The British Independent Retailers Association (Bira) is calling for business rates to be remain suspended following a report from the British Retail Consortium (BRC) revealing the true impact of Covid-19 on shopper footfall. The BRC released its ShopperTrak Footfall Monitor for December 2020. At the time, BRC boss Helen Dickinson said: “After an encouraging start to the month Christmas shopper numbers dwindled as December progressed, due in large part to the creation of tier 4 in England and increased restrictions elsewhere in the UK. “Now that all parts of the UK are
effectively in lockdown and with social distancing measures expected to continue well into the New Year, ‘non-essential’ stores will be unable to trade their way back to recovery. “The Government must urgently
reassure those businesses hardest hit by the pandemic that they will receive vital financial support in the form of an extension to the coronavirus business rates relief.” Key findings of the BRC report
were: • Total year on year footfall for 2020 fell by 43.4 per cent; • Year on year UK Footfall
74 CHAMBERLINK February 2021
decreased by 46.1 per cent in November, a 19.3 percentage point improvement from November when England was under lockdown; • Footfall on High Streets declined by 49.5 per cent year on year. This was the worst performing location type for the fifth consecutive month; • Northern Ireland saw the shallowest footfall decline of all regions at -47.2 per cent, followed by Scotland at -50.2 per cent. Wales saw a decline of -52 per cent; • The ‘golden’ quarter saw nearly half the footfall (a decline of 48.4 per cent) compared to the same period in 2019. Following the report, Bira is
calling for business rates to be abolished until 2022. These rates are currently due to
be reinstated this April following a freeze through the pandemic. Andrew Goodacre, Bira's CEO,
said: “These figures are a clear indication the impact of lockdowns and Covid-19. The situation has made retailers even more vulnerable than they might normally have been at this time of year, and that is why we believe the Government support measures do not go far enough.”
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