More and more European governments are following the example of the Republic of Ireland, which ordered a six-week lockdown on the sale of non-essential goods at physical stores on Oct. 21 to help stem the second wave of the Covid-19 epidemic, which now has its epicenter in Europe, as in the spring. Some are also closing gyms and other places where people can contaminate each other, while leaving factories, offices and schools open and encouraging remote working whenever possible.
The timing of this second wave of lockdowns is particularly unfortunate because it coincides with the start of the Christmas shopping season and preparations for the year-end holidays. The fourth quarter is the most profitable quarter for many brick-and-mortar sporting goods stores, which tend to start selling cold-weather clothing and footwear and winter sporting goods equipment at this time of the year. Big e-tailers like Amazon, Zalando and Asos will probably benefit the most from the new retail lockdowns, with peak sales during their usual Black Friday promotions.
In ordering new restrictions on physical retailing in the past few days, the governments of France, Germany and the U.K. have indicated that they will review the situation in a couple of weeks and at the end of November, hoping that they will be able to soften some of the measures by the beginning of December if the virus is brought under control by then. However, retailers are furious, claiming that they are scrupulously observing hygienic regulations, and some scientists indicate that the novel coronavirus will likely continue to strain hospitals through the end of the year.
While France and the U.K. are enforcing a total ban on stores that sell non-essential items, the German government has allowed them to service customers on a pro-rata of their interior sales surface, stressing that it will largely depend on individuals’ sense of responsibility to protect themselves and others. While closing gyms, swimming pools and theaters, the Austrian government is keeping stores and hair-dressers open for the time being, in contrast with what it did in the spring.
Margit Grosau, the German-based managing director of Sport 2000 International, agreed that the new lockdowns will result in another big loss of sales for independent sporting goods retailers, but she felt that they are more relaxed than last spring, as they have learnt many lessons from the spring wave of the coronavirus outbreak. Coming out of a generally favorable summer selling season, they are now in a better position to use the digital tools at their disposal and to coordinate their actions with suppliers.
While considering that sporting goods should be considered “essential” items, because sports help people fight all kinds of diseases, a spokesman for Decathlon said the company is accelerating the deployment of new digital solutions. For example, all its stores in France have started to offer click-and-collect services, and in some cases also home delivery.
In ordering the new lockdowns, government authorities have promised all kinds of financial help to compensate in part for retailers’ fixed costs and lower sales. There is no doubt, however, that only the fittest and smartest will survive. In Germany, total sales of clothing, shoes and leathergoods already fell by 23.5 percent in the first nine months of this year, according to the federal statistics office.
We hear that the rate of decline in the sporting goods sector has been a little lower overall. In the Netherlands, for example, it has fallen by 7 percent through September, according to FGHS. Yet, there is no doubt that 2020 will be an “annus horribilis” for sporting goods retailers worldwide because of the pandemic, partly offsetting a long interrupted series of annual gains of around 5 percent registered for the past 12 years, according to NPD, after a 2 percent decline in 2008.