Solomon Lew decries government 'inaction' as retail shutdown announced
Billionaire retailer Solomon Lew has hit out against the Victorian government over its new limits on retail trade in the state, accusing the Andrews government of not acting early enough and causing unnecessary damage to the economy.
On Monday, the state government announced the majority of retailers across Melbourne will be forced to either shut down entirely or switch to online-only orders as part of sweeping new rules for the state's 'stage four' coronavirus lockdown plans.
Retail billionaire Solomon Lew has hit out at the Andrews government over its management of Victoria's lockdowns.Credit:Paul Jeffers
Mr Lew, who operates stores such as Smiggle, Just Jeans, JayJays and Dotti under his Premier Investments business, said while the steps taken were the right choice, the government should have moved quicker.
"While this is the right step, acting sooner could have prevented a lot of illness and unnecessary deaths. Delaying has only placed further pressure on the rest of the country and the national economy," Mr Lew said.
"We expect significant consequences from the inaction, in particular, vast amounts of cost in federal government stimulus that is going to be required to support the Victorian community through this challenging period."
Major retailers such as Harvey Norman, JB Hi-Fi, Officeworks and David Jones, which traded through the first and second lockdowns in the state, will now be required to shut their doors for the next six weeks due to the rule changes.
Supermarkets, liquor stores, newsagents, fuel retailers, pharmacies, post offices, and maternity retailers will be the only retailers permitted to trade from midnight Wednesday with strict social distancing measures in place. Other exemptions will be made for trade customers at hardware retailers, sellers of disability equipment, specialist stationery retailers, and motor vehicle parts.
All other businesses not granted an exemption will be forced to close, however, they will be allowed to work onsite for the purpose of fulfilling online orders. Contactless pickup and delivery such as click and collect will also be permitted.
Retail giant Wesfarmers' chief executive Rob Scott said he respected the decisions made but welcomed the government's announcement it would "fine-tune" further aspects of the restrictions where anomalies were identified.
"For example, these restrictions could prevent households getting essential goods quickly while activities such as liquor sales and horse racing continue," he said.
Mr Scott also urged the government to consider further changes to restrictions for supply chains when producing and distributing products within and beyond Victoria.
Hardware giant Bunnings, which is owned by Wesfarmers, had been gunning for an exemption to the shutdown, with managing director Michael Schneider saying supplies for home improvement works should be viewed as essential.
But under the new restrictions, Bunnings will only be able to open for trade customers and for contactless pick-up.
Shares in major retailers such as JB Hi-Fi and Mr Lew's Premier Investments fell on Monday in response to the tough new measures, with the broader discretionary retail index falling 1.6 per cent. Online retailers bucked the trend, with e-tailer Kogan rising 9.5 per cent.
Paul Zahra, the chief executive of the Australian Retailers Association, said he was bracing for the worst after first hearing of the government's plans to enter stage four restrictions, but said today's announcement was better than expected.
"It's pleasing that at least retailers can pivot to their online businesses and that distribution centres and online warehouses can continue to operate," he said.
The ability to sell online and offer click and collect would "soften the blow" of the shutdown, he said, but will likely be a consolation prize for many retailers who make most of their sales in-store. It will also disproportionately affect small businesses who often don't have strong online systems set up, he said.
The industry body chief said there were still areas he would seek clarity on from the state government, such as if pet stores are able to open, which he expected would be specified in the coming days.
Around 250,000 workers will be affected by the broader stage four changes, including a significant number of retail staff, who will now be reliant on the government's JobKeeper and JobSeeker stimulus.
"Retail will look very different than it's looked," Premier Daniel Andrews said on Monday.
"There is significant damage that needs to be done here, but there is no choice but to do that damage, to fix the health problem and then be able to move to rebuilding the economy."