Date Published: 12/05/2020
ARCHIVED - Spanish government prohibits summer sales to reduce risk of crowding
ARCHIVED ARTICLE Regions which have passed into phase one now allow small retailers to open
On Monday approximately 51% of the Spanish population moved from phase zero into phase one of the Covid-19 de-escalation phase, permitting small retail shops to re-open.
ATA, the federation representing self-employed workers, estimated yesterday that around 60% of retailers with less than 400 square metres of sales area had resumed trading in the regions passing into phase one.
But many are stuck with products purchased for the spring which they have been unable to put on sale for the last two months, all of their working cash tied up into stock which is rapidly becoming unsaleable as the weather warms up.
Although they are keen to move on their existing stock, cashflow is too tight to purchase new items and stock levels are high as their businesses were locked-down just before the busy Easter shopping period.
So on the one hand a sale would generate a bit of excitement and bring shoppers piling into the store…..but as stores are only allowed to trade at 30% of their capacity in order to minimise social contact the last thing the government actually wants is crowds of people flocking into the shops in search of bargains.
And on the other hand, many businesses are struggling to remain solvent as it is after 2 months of enforced closure in which landlords are not obliged to waive the rent and many fixed overheads must still be paid, so selling off the stock without making any profit is not an option either.
This is the point of view adopted by the UPTA union which formally petitioned the Ministry of Industry and Commerce several weeks ago requesting that sales be prohibited until August in order to prevent the big chain stores from launching aggressive discounting campaigns and making it impossible for the smaller shops to clear their stock.
At the moment the larger chains are not allowed to open until the beginning of phase 2 on 24th May, so the smaller retailers have a little time to get ahead and pick up all those shoppers who are desperate to splash a bit of cash after being locked up for two months.
But not at any price and certainly not at the risk of encouraging crowds in the streets, hence the decision of the government to effectively ban sales, published in the BOE on Saturday.
"Establishments may not advertise or carry out commercial actions that may give rise to crowds of the public, both within the commercial establishment and in its vicinity. This restriction will not affect sales or promotions that are made through the web page."
So shops are allowed to sell their products at reduced prices online, but not in the store.
YESTERDAY THERE WERE STILL 65,000 ACTIVE CASES OF COVID-19 ACROSS SPAIN: TAKE SENSIBLE MEASURES TO PROTECT YOURSELF AND PREVENT THE FURTHER SPREAD OF CORONAVIRUS.