Suspending Sunday Trading for Olympics 2012 Is Mixed News for Business, Says KPMG

Michelle Remo, “Big 4″ observer
July 23, 2012 /

Retail stores are preparing as the UK government has suspended Sunday trading laws in England and Wales for eight weeks when Olympics 2012 is over to drive growth, though the impact of suspension has potential to hit smaller stores and increase operating costs.

Open all Hours’ culture is driven by consumer demand and online experience. The government said the lifting of trading suspensions would help retailers generate tens of millions of pounds in increased profits during Olympics 2012 in London.

Mona Bitar, partner in KPMG’s Operations Strategy Group, comments: “Current restrictions on Sunday trading have been in force for 18 years, but in that time the UK’s shopping environment has radically changed. The growth of digital Britain and the proliferation of tablets and smart-phones means that how and where consumers shop is no longer governed by the hands on a clock. Britain’s comfort with e-commerce means that we really are open all hours.

“With an ‘always on’ culture of shopping, consumers are increasingly placing a premium on convenience so there is a case to be made for these demands to be met, as part of the drive for economic growth.

“However, relaxing Sunday trading laws could potentially benefit the larger shops as consumers are lured away from convenience stores turning towards brands they know. By diverting foot-fall away from local stores towards city centres and tourist spots, independent retailers will need to work hard to ensure they continue to lure customers in and do not suffer.”

The benefits of a temporary suspension of the law will also only apply to retailers with floor space of more than 3,000 sq ft. They are currently restricted to trading to six hours on a Sunday.

Helen Dickinson, head of retail at KPMG says: “The Chancellor’s decision to try to boost the sector by suspending restrictions on opening hours for retailers will ultimately only benefit those with floor space of more than 3,000 sq ft who are currently restricted by a limited trading window between 10am and 6pm every Sunday. But even for these businesses, the ability to trade for longer also brings increased overheads and staffing issues and so care will need to be taken to ensure any sales uplift is not eroded though higher costs.

“Retailers will also need to plan carefully so staff and goods can get to stores on time and safely. The relaxation of the night time delivery restrictions is helpful but does not compensate for the logistical challenges associated with ensuring stock availability levels are up to scratch – a particular challenge for the supermarkets which normally have many deliveries each day each within carefully pre-defined timeslots.”

 

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