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Retail businesses have faced an arduous 18 months, having to contend with difficult, changeable and often confusing Government guidance to keep customers safe, as well as absorbing the cost of lockdowns and safety protocols, which will have impacted heavily on their cashflow.
That said, we know that during the first lockdown many small firms were able to adapt to a rapidly changing and unpredictable situation by making alterations to their business. Over the last 18 months we’ve seen some great examples of firms creating and rolling out innovative new services and products to keep their businesses going. Some have been able to expand or start online operations and food delivery services, while others have created new products to make sure customers can still make purchases.
The removal of business rates on independent food retailers in England last year was a lifeline, but while the further discount this year has been useful, fundamental reform is needed to this regressive tax, which is charged before a business has turned over a penny, let alone turned a profit. Our own research found two-thirds of small businesses in receipt of rates relief would have to close their premises or reduce their staff if their relief were removed.
Retail businesses not only provide millions of jobs in the UK but are an integral part of our communities – something which was really apparent through the pandemic. In April last year, almost 60% of small retail firms had carried out a community role during the crisis, including supporting vulnerable customers, offering free home deliveries or donating provisions to local food banks.
With the current focus on working from home and other more flexible arrangements, many local high street businesses will have enjoyed an increase in footfall, with home-based workers spending more at their nearby shops and stores. As employers look towards bringing in a more flexible approach to working on a permanent basis, this focus will likely continue giving a well-earned boost to local high streets and businesses.