There’s no doubt that the UK’s retail and leisure industries have entered unchartered territory due to Covid-19, with the implications of the virus and the necessary containment measures impacting the sector in a way we have never experienced before.

That’s why it can be difficult to predict how we expect this to pan out, and while we can draw some comparisons with other previous global events such as SARS or the 9/11 attacks, the spread of Covid-19 is unique. However, what we can do is look at the effect that the coronavirus had on the retail market in China, given that we are now beginning to see signs of recovery as day-to-day life in China starts to return to some level of normality.

Data from Peking University’s Digital Finance Research Centre and Ant Financial shows that in the two weeks following the end of the normal Lunar public holiday, when the virus in China was hitting peak levels, retail sales from the businesses they track were down 52.4 per cent. Likewise, Starbucks indicated a 78 per cent decline in same-store sales in China in January and February due to major store closures. These sorts of figures are unfortunately now starting to become familiar here in the UK.

H&M noted a 24 per cent decline in sales in China over the first quarter, with 334 out of the group’s 518 stores closed in the country at the peak of the outbreak. However, the retailer has since noted that sales have started to recover which is hugely positive news. Equally, footfall has started to return to shopping centres, albeit at low levels, with the majority of stores in malls having now reopened and business hours, on the whole, returning to the usual. With recovery still in its very early stages, footfall is understandably still at tentative levels and we are yet to see signs of ‘revenge spending’ given the impact that the virus has had on jobs and disposable incomes, but it is positive to see that retailers have reopened for trade and are ready to welcome customers back. With regards to restaurants, of those that have been given the go-ahead to reopen (subject to government approval) many have seen customers eager to return with restrictions being placed on crowds and the number of customers that can sit at one table.

A factor that must be considered, however, is the variation in approaches to tackling the virus, making it difficult to state that we expect the UK market to recover in exactly the same way. However, with shopping centres, restaurants, gyms and nightclubs all having recently reopened in most of China, the country’s retail and leisure market is poised for recovery, and we can hope that when we get to this stage in the UK we will see a similar uptick in footfall and sales. While a full rebound isn’t likely to take place until the second half of the year, our colleagues in China have noted that the outlook is improving on a weekly basis and with the overwhelmingly negative news over the past weeks, any improvement must certainly be taken as a positive.

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