Lockdown 3 is changing the high street – here’s how

22 February 2021, 08:51 AM
  • Food retailers remain buoyant as in-store and online sales continue to rise, but the wider high street is facing a shake-up
Lockdown 3 is changing the high street – here’s how

The high street has taken a battering during Lockdown 3 as non-essential retailers and hospitality businesses remain shut – but food retailers have continued to prove resilient.

Across the retail sector, more than 27,000 jobs have been lost and over 1,000 stores are planning to close in 2021 alone, according to the Centre for Retail Research.

However, insights from Springboard show that shoppers are experiencing “lockdown fatigue” as footfall increased for the fourth week in a row, despite many shops being shut and snow hitting much of the country. “In fact, in the seven weeks since Lockdown 3 came into effect on Boxing Day, the only declines have been in the first three weeks of the lockdown, which included the two weeks following Christmas when footfall typically drops anyway,” said Diane Wehrle, marketing and insights director at Springboard.

The high street moves online

Although total retail sales were down 7.2% year-on-year in January, e-commerce has continued to grow, according to official data. Online sales accounted for more than a third of total retail spending in January, up from 19.5% a year earlier and from 29.6% in December, the Office for National Statistics found.

For the food sector, 12.2% of all grocery sales were made online in January, the highest proportion on record. Anecdotal evidence from retailers suggested that click and collect food orders had boosted online sales. Compared to December, total food store sales were up 1.4%.

What’s more, planning applications for new stores were down by nearly a quarter in England as shops shifted their focus to online sales. In the City of London, planning applications for new shops and shopping centres were down by almost 60%.

Food shops benefit from home cooking trend

The food and drink sector has found success in e-commerce as the home cooking trend continues to boost sales. Online specialist food retailer Sous Chef noted that in Lockdown 3, demand has risen for cookbooks and ingredient sets. “Comparing data for our top-selling cookbook and ingredients sets, including restaurant cookbook Dishoom, Q1 has seen an 800% increase of online traffic to those products YOY,” said Isobel Gillott, e-commerce assistant at Sous Chef.

“This suggests that people are enjoying cooking more complex recipes that they normally simply don’t have the time to – or would usually prefer to eat out of home. Often these recipes require ingredients that aren’t available in most supermarkets, with a corresponding increased rate of sale – including white miso, gochujang, kimchi,” she added.

Food producers have also been seeking to strengthen their digital pivots. “We recognised very early on in the Covid-19 pandemic that developing our online deli and offering a wide range of produce to consumers would be a way to ensure our customers could still purchase their favourite artisan cheese and delicious local accompaniments from the safety and comfort of their own homes,” said Sandra Bell, marketing manager at the Wensleydale Creamery.

“Since the creation of our online deli in March 2020, it has proved to be extremely popular with consumers and there has been continued success and demand throughout Lockdown 3, with orders up 1,373% since this time last year, making e-commerce a large portion of our overall sales,” Sandra added.

Piccolo Organic makes healthy baby meals, cooking products and snacks, and founder Cat Gazzoli quickly pivoted and set up a temporary online store during the UK’s first lockdown. “Piccolo’s temporary store has expanded to our permanent e-commerce site and personalised subscription service – a decision we took to accommodate parents seeking convenient, easier ways of shopping,” Cat said. “As a small brand, we can be agile and setting up our D2C site has allowed us to keep providing families with Piccolo food for their little ones. Whilst in-store purchasing will always play a vital role, it’s clear that this shift to e-commerce will only continue to become more prominent in the future.”

Pam Digva, co-founder and brand director of craft condiment brand Sauce Shop told Speciality Food that after the closure of some of the hospitality businesses that Sauce Shop works with, the company made a “substantial shift” in its sales mix and strategy.

“The way consumers choose (or not as the case may be) to eat has changed and, fortunately for us, this has led to increased online grocery sales,” Pam said. “While we don’t necessarily see sauce as an essential food item, it certainly seems to have become a regular treat for many households. Where people were going out, they are now staying in and trying out new cooking techniques and creating amazing home-cooked food, to which sauces and seasonings are integral.

“Our e-commerce business is flourishing, which we are extremely grateful for, but we can’t wait to see our friends and colleagues in the food service industry open their doors again. It’s not the same without them,” she continued.

Hospitality sector pushes for reopening

The hospitality industry has urged the government to ensure it will be central to reopening plans after the industry saw a 54% fall in sales in 2020. “The result of the lockdowns and the restrictions placed on the sector last year was crippling. Business was devastated to an extent hitherto unimaginable. Many businesses are barely surviving and cannot afford another year with restrictions on the scale of 2020,” said UKHospitality chief executive Kate Nicholls.

In a report on the safe reopening of hospitality, analysts found that hospitality businesses were not significant Covid transmission areas in 2020, and UKHospitality argues that they will not be a significant area of Covid transmission in 2021 when lockdown measures are relaxed.

Many fine food retailers with cafés or restaurants have been able to offset the lost sales of their hospitality businesses with the increase in demand for speciality food offerings, but the industry will no doubt welcome the safe reopening of hospitality and non-essential retail to once again breathe life into Britain’s high streets.

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