With the rolling back of JobKeeper looming, many retailers that are unable to make their business function online are at risk of collapse according to the National Retail Association (NRA).
And, while the industry body supports government loans of up to $6000 to help retailers get online, not all businesses can easily transition to a digital environment.
To support these businesses, the NRA is calling on the federal government to provide $5000 loans to small businesses that rely on bricks-and-mortar shopping.
“E-commerce is going to be essential for many businesses going forward, but not all businesses can go online,” NRA chief executive Dominique Lamb said.
“What many retailers desperately need are loans so they can freshen up their public facing branding to attract customers and help keep them afloat during this period of instability.”
According to the NRA, retail comprised about 20 per cent of all businesses that closed their doors between June 2019 and March 2020, based on ABS statistics.
And, as Deloitte Access Economics pointed out in a report released today, things aren’t about to get easier for retail in 2021.
“We’re concerned for stores that require a customer to physically inspect items before committing to a purchase – like furniture, electronics and homewares stores – it’s much harder for these retailers to go digital because of the purchasing processes,” Lamb said.
These businesses must rely on different methods to bring customers instore and buying, according to the NRA, such as utilising certain types of light to flag offers.
The NRA said Adelaide-based mobile phone company Pop Phones used cold white light to advertise monthly promotions and saw a 10 per cent increase in sales of these items, but that physical marketing costs can quickly balloon and that Government assistance could go a long way in helping close the gap.
The JobKeeper support measure is due to be wrapped up by the end of March, leaving many industries worried about the approaching financial “cliff” and what it will mean for them.
The Government has said on multiple occasions it has no intention of extending JobKeeper again, and that it was always intended to be a temporary relief measure.
Federal treasurer Josh Frydenberg said earlier this year that economic recovery would have to move beyond relying solely on JobKeeper – with personal income tax cuts and the JobMaker hiring credits set to do the heavy lifting moving forward.
This story first appeared on our sister publication Inside Retail