Many local businesses including bookstore chain Readings are expecting sales to decline considerably over the next six weeks, as Melbournians are put back in stage 3 lock down in an effort to contain the worrying increase in cases of COVID-19 in recent weeks.
The announcement on Tuesday afternoon came several days after the Victorian government put certain postcodes in Melbourne back in lock down, as well as the city’s public housing towers, in an attempt to contain the outbreak in a more targeted way.
Stage 3 restrictions mean there are only four reasons for people to leave their home: to shop for food and other essential items, to provide care giving, seek medical treatment or for compassionate reasons, for outdoor exercise, or for work or study if unable to do so at home.
These restrictions also apply to the Shire of Mitchell in Victoria, with residents in these areas are being asked not to leave to prevent the outbreak from spreading to regional Victoria.
From midnight on Wednesday, businesses in Melbourne and the Shire of Mitchell that had just reopened, including restaurants, cafes, pubs, beauty salons, gyms and cinemas, will either have to close or return to takeaway and delivery service only for the duration of the lock down.
Most retailers were never forced to shut during the previous lock down, but the same reasons many chose to close their stores in April, including concern about the health and safety of staff and customers and the commercial reality of keeping stores open for minimal foot traffic – still hold true today.
Inside Retail asked several retail businesses that closed stores in the last lock down, including Myer, Kathmandu, Accent Group and Premier Investments, whether they plan to close stores again, but had not received replies at the time of publication.
Beloved Melbourne bookstore chain Readings is one such retailer that has decided to close its stores again, with some caveats.
“We’ll close, but not as hard as before. Customers will be able to come to the door and request things, but we won’t be letting them inside at this stage,” said Mark Rubbo, Readings’ managing director.
The retailer operates six bricks-and-mortar stores throughout Melbourne, including one store at Westfield Doncaster shopping centre, which will remain open with modified trading hours.
“It’s very disappointing,” Mr. Rubbo said. “We were just starting to build the business back up again.”
Readings learned some lessons during the last lock down, including implementing new processes around cleaning, and is better prepared for the second lock down, according to Rubbo. But he is still bracing for a big impact.
“The Premier said people should stay home, so I think traffic will reduce dramatically,” he said. “Our business will go down considerably.”
Readings’ sales in April dropped by 50% compared to April of 2019, thanks in large part to an increase in online orders.
When asked how he expects the business to survive another drop in sales, Rubbo noted that Readings has qualified JobKeeper payments, which helped a lot, and received rent relief, though it wasn’t easy.
“One of our landlords said that we weren’t required by law to close so why should they give us a reduction? They did in the end,” Mr. Rubbo said.
A second lock down brings additional challenges, including keeping customers informed of what’s going on, changing rosters again to reflect the need for less staff, working with suppliers to revise order volumes, as well as maintaining a positive mindset for the future.
“My biggest worry is Christmas. That’s when you make the money to take you through the rest of the year. With social distancing, I don’t know how we can do the volume we need to do,” Rubbo said.
Last Christmas Eve, Readings had 20,000 people come through its flagship store in the Melbourne suburb of Carlton.
This article was originally published on Inside Retail here.