Stores struggling to see light at end of tunnel

The Scottish Shop retailer Sharon Hannaford in the store on Thursday. PHOTOS: GREGOR RICHARDSON
The Scottish Shop retailer Sharon Hannaford in the store on Thursday. PHOTOS: GREGOR RICHARDSON
Two years into the Covid-19 pandemic, businesses are still struggling and some fear it's about to get worse. Business reporter Riley Kennedy spoke to some Dunedin central-city retailers about what business was like — just before Omicron’s arrival in the city.

"Bloody depressing."

"Incredibly tough."

"When is it going to end?"

Those were just some of the comments by business owners describing the current situation to the Otago Daily Times on Thursday afternoon — just hours before the first case of Omicron was confirmed in Dunedin.

While the Red setting in the Government’s Covid-19 protection framework is not a lockdown and does allow businesses to operate, they are subject to vaccination pass rules, gathering restrictions and social distancing requirements.

And there are fears that once Omicron spreads, people will go into a "de facto lockdown".

Something Sharon Hannaford is very worried about.

She bought The Scottish Shop, in the Octagon, just six weeks before the first lockdown in March 2020.

The gift shop relied heavily on overseas tourists, particularly cruise ship passengers, visiting Dunedin.

After the first lockdown, the store had done pretty well particularly as New Zealanders travelled around their own country, Ms Hannaford said.

But after last August’s lockdown, and with Aucklanders not being able to travel, there had been nobody around.

There had been a couple of reasonably busy weeks after Christmas, but that passed quickly after the country went into the Red traffic light setting.

Ms Hannaford said the store was the quietest she had ever seen it.

Rembrandt 2IC Catherine Whitley reflects on the pandemic’s effects on the George St store.
Rembrandt 2IC Catherine Whitley reflects on the pandemic’s effects on the George St store.
"We can’t do another summer like this."

There was still a lot of uncertainty about the future, especially since the Government would not commit to dropping the self-isolation requirements for tourists when the managed isolation and quarantine system is dropped later this year.

"If they don’t do that, it won’t help us one little bit," she said.

Supply chain issues were also causing headaches for her shop.

"Even if we survive, there is a good possibility we won’t have stock for the shop," she said

Suits on Wall Street owner Martyn Ballantyne had similar feelings.

Since the shift into Red, trading at the men’s clothing shop in the Wall Street Mall had been down between 30% and 35%.

Mr Ballantyne had noticed a significant decline in foot traffic in the mall in the past three weeks.

Business had been good before the Red light restrictions came in, but shoppers now had feelings of "fear and anxiety", he said.

"To say it diplomatically, it has been volatile."

Another retailer in the mall, who declined to be named, said it was hard to describe how tough trading was at present.

"It’s just so bloody depressing," they said.

Clothing shop Rembrandt had also noticed a sizeable drop-off in foot traffic.

The store’s 2IC Catherine Whitley said it was still trading well, but the health and safety of staff was a big concern.

Staff were on the front line and it was concerning especially with the virus in the community, she said.

Pedestrians in George St on Thursday afternoon.
Pedestrians in George St on Thursday afternoon.

In terms of trading disruption, it was a different story up the street at Photo Warehouse.

Manager Jonathan Kemp said the store had been trading well despite the Red setting, and customers were "very understanding" about the restrictions.

The shop benefitted from being a "destination store" and did not rely on people walking past.

"Students are starting to come back so that will help things even more," Mr Kemp said.

Business South chief executive Mike Collins said the Government needed to make targeted support available for those businesses doing it tough.

The Government had missed the opportunity to position businesses to be ready to operate with Covid-19 in the community and business’ resilience had been burnt through, he said.

In that context, the timing of the Government’s announcement of other policies such as the Social Insurance Scheme was "dreadful".

"[Businesses] are in the midst of a whole lot of trauma and just trying to survive, then the Government goes and puts a whole other layer on top."

Mr Collins wanted the Government to put in place more support measures to keep businesses operating during the outbreak.

The events sector had been "ripped apart" by the traffic light system and needed immediate financial support, he said.

"The Government needs to get a better understanding of where businesses are at at the moment."

Finance Minister Grant Robertson told RNZ the Government was continually monitoring the impact of the Covid-19 pandemic on businesses, including by looking at up-to-date sales data.

The small business cashflow loans scheme was still open for applications until December next year, and the Inland Revenue commissioner was also able to offer deferred payments on some tax obligations.

The short-term absence payment and leave support scheme were also still in place, Mr Robertson said.