New lockdown: the retail sector is running out of reserves

display

In the hope of averting a wave of bankruptcies at the last minute, the trade association HDE has made a dramatic appeal to the German head of government.

"Many trading companies that are affected by the two-time lockdown have largely consumed their equity," says a letter from HDE President Josef Sanktjohanser and Managing Director Stefan Genth to Chancellor Angela Merkel.

Without rapid economic help, 50,000 businesses with more than 250,000 jobs would be on the brink of collapse.

A concrete end to the closure of practically all stationary shops beyond grocery stores and drug stores is currently not in sight.

On the day before the federal-state meeting planned for Tuesday, it became apparent that the lockdown would be extended beyond January 11th.

Here you will find content from Twitter

In order to interact with or display content from Twitter and other social networks, we need your consent.

Activate social networks

I consent to content from social networks being displayed to me.

This allows personal data to be transmitted to third party providers.

This may require the storage of cookies on your device.

More information can be found here.

display

“The lockdown has to be extended until the end of January.

Premature loosening would throw us back a long way, ”wrote Bavaria's Prime Minister Markus

Söder on the short message service Twitter.

Other country leaders made similar statements.

A frontal attack by the HDE leadership is directed against Federal Finance Minister Olaf Scholz (SPD).

The lack of economic support for dealers is "a scandal," says the letter that WELT has received.

The finance minister has repeatedly announced billions in aid, but the disbursement actually fails due to excessively high and complicated access barriers.

In addition, the aid was distributed extremely unfairly.

New figures show: the warnings are more than lobbying

display

"While the gastronomy in lockdown made the best Christmas business in years thanks to more than generous aid from the state, the Christmas business is being completely withdrawn from the retail trade," complain Sanktjohanser and Genth.

New figures from economic researchers suggest that there could be more to the association's warnings than the usual demands of lobby groups for more money for their clientele.

According to the Ifo Institute, short-time working in retail is currently increasing by leaps and bounds, while it is falling in other areas of the economy such as industry.

According to Ifo estimates, 150,000 people were affected in December, an increase of 55 percent within just one month.

display

In fact, the number could be even higher, because numerous companies had announced appropriate measures before the second lockdown.

Overall, short-time work in Germany fell from 1.98 million to 1.95 million, according to Ifo estimates.

According to a quick survey by the trade association of 700 traders, two out of three merchants see their economic existence in danger.

Three quarters of the dealers said that government aid was insufficient to avert bankruptcy.

"For many traders, it's just after twelve," said Genth.

In the letter to Merkel, the industry representatives assured politics of further support in the fight against corona, but at the same time they expressed incomprehension for the nationwide forced closure of shops.

In the months before the lockdown, retailers had proven that open shop doors and fighting pandemics were not a contradiction in terms.

“Retail is not a hotspot.

The number of illnesses among employees is at an inconspicuous level, ”says the letter.

In the past week alone, the businesses affected by the closure lost around five billion euros in sales.

In the entire past year, the losses would have amounted to 36 billion euros.

"The companies can no longer compensate for this without help," said Genth.

"If the prime ministers decide to close our shops together with the chancellor, they must also provide the necessary support," he demanded.

The primary goal must be to reopen the shops and then keep them open.

"The second horror season in a row is looming in the fashion trade"

Fashion houses are currently particularly affected.

"After the lockdown in March / April, the fashion trade threatens the second horror season in a row," said a spokesman for the textile trade.

According to extrapolations, the loss of sales in the inner-city fashion and shoe trade in the first three weeks of November was 40 percent, in individual cases up to 80 percent.

display

There are currently far too many goods in the product pipeline.

Because of the long international supply chains, the orders from merchants for the current autumn / winter season were already placed before the start of the corona pandemic - with correspondingly high numbers.

In addition, prices in the industry traditionally come under pressure as the fashion season progresses.

"After all, fashionable sweaters, winter boots or bags can hardly be sold next spring," said the spokesman.

Without a quick turnaround in the epidemic situation, the plight of the fashion stores, decorative stores, sporting goods retailers and other shop owners could lead to a disaster for Germany's inner cities.

As early as mid-December, the President of the German Association of Cities, Burkhard Jung, pointed out that the fight against the corona epidemic could finally push the city locations, which are already under pressure from the massively growing online trade, to the brink of existence.

"Many retailers and large chain stores warn that they will not be able to pay their rents for much longer," said Jung.

Increasing vacancies in pedestrian zones and shopping malls threaten a domino effect of neglect.

Parcel delivery required - online shopping could become more expensive

The retail trade shaken by the lockdown is to be strengthened by a “pact for the inner cities”.

For financing, the Union group wants to ask providers in the network with a package delivery for online trading to the cash.

Source: WELT / Sebastian Honekamp

In addition, the merchants in the current crisis are caught up with their own failures from the past.

Experts have identified a huge digitization gap in the industry.

According to a study by the Regensburg research institute Ibi-Research, more than three quarters of all retail companies do not have a separate budget for digitization measures, and more than half are currently not pursuing any projects in this direction.

"It is noticeable that it is only small dealers who do without digital applications," says the report.

Numerous companies could no longer win the race to catch up, said economist and trade expert Gerrit Heinemann recently: “For many it is too late.

You missed the start. "

display

The merchants can no longer hope for a tailwind from the overall economic development.

The buying mood of consumers is noticeably falling under the impact of the pandemic, the HDE reported on Monday.

Its consumption barometer shows a deterioration in consumer sentiment in the coming months.

The index fell for the third month in a row and is now well below its level at the beginning of 2020.

Many companies are on the verge of bankruptcy

After this year, things can only really look better.

Indeed, according to a survey, a majority of industries believe 2021 will get better.

But by no means for everyone.

Many companies are on the verge of bankruptcy.

Source: WELT / Sebastian Plantholt