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Home / Business / Small Business

Covid 19 coronavirus: Retail fears as Auckland CBD and airport spending at 'unsustainable' levels

Ben Leahy
By Ben Leahy
Reporter·NZ Herald·
25 Jun, 2020 05:00 PM5 mins to read

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Retailers in the Auckland CBD are still suffering a drop in spending in the city centre since New Zealand went into lockdown. Photo / Michael Craig

Retailers in the Auckland CBD are still suffering a drop in spending in the city centre since New Zealand went into lockdown. Photo / Michael Craig

Lisa Pini's lingerie store near Auckland Airport used to have streams of tourists stopping by to grab last-minute presents before jetting overseas.

But since international borders closed in March, customer numbers at the Bendon Outlet Airpark store in Māngere's Airport Shopping Centre have plummeted 50 per cent.

It's meant the store has suddenly became heavily reliant on nearby workers and locals to drop in during their lunch breaks.

That's included spending more time helping forgetful husbands and partners win their way back into the hearts of loved ones.

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"There's been a few guys coming in saying, 'Aw, I forgot her birthday or our anniversary'," Bendon Outlet Airpark manager Pini said.

But the downturn hasn't been limited to lingerie sales.

There has also been a wider Eftpos spending slump across the Auckland airport precinct in Māngere-Otahuhu, according to analysts Dot Loves Data.

A lone passenger walks along an almost deserted Auckland Airport Domestic Terminal in March. Photo / Peter Meecham
A lone passenger walks along an almost deserted Auckland Airport Domestic Terminal in March. Photo / Peter Meecham

It said precinct spending in the first week of June - the last week of New Zealand's level 2 Covid-19 restrictions - fell 27 per cent compared to the same week in 2019.

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That was the third biggest spending drop in the country.

Only Queenstown-Wanaka, with a 42 per cent drop in Eftpos spending compared to last year, and Auckland's CBD, with a 28 per cent slump, were hit harder.

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Across the country as a whole, the news wasn't so grim, however; spending was down just 1 per cent.

EFTPOS
EFTPOS

The better-than-expected results were driven by some stand out sectors.

Auckland's beer, wine and liquor sales surged 221 per cent before New Zealanders went into level 4 lockdown in March and had been "consistently 10 to 20 per cent higher than 2019 sales since the beginning of June," Dot Loves Data's Justin Lester said.

Luxury goods sales - including home furnishing, antiques, jewellery, music stores and art - were also up 27 per cent, while hairdressers and beauty salons were up 2.5 per cent.

Tourism-facing industries, continued to battle, however.

Spending at Auckland CBD travel agencies were down 170 per cent compared to last year.

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"Travel agencies are down heavily and are refunding more customers than they are attracting revenue, hotels and motels are down a huge 67.2 per cent in Auckland CBD and 97.1 per cent in Māngere-Otahuhu," Lester said.

Justin Lester, from analysts Dot Loves Data, said Eftpos spending in Auckland's CBD and near the airport was at "unsustainable" levels for retailers.  Photo / Georgina Campbell
Justin Lester, from analysts Dot Loves Data, said Eftpos spending in Auckland's CBD and near the airport was at "unsustainable" levels for retailers. Photo / Georgina Campbell

He said overall spending figures for "Auckland CBD and Auckland Airport remained unsustainably low across almost all sectors".

Not all businesses were struggling near the airport, though.

Megan Burrows, the manager of Taking Shape clothing outlet, a few doors down from Pini's lingerie store, said sales had jumped since level 1 and the store was now busier than the same time last year.

That was partly because of the return of domestic travel. She said the Taking Shape brand was familiar to domestic travellers but not so well-known among international visitors.

"We are right by the airport, I thought people would be scared and not coming out but nah, it's been crazy [busy]," she said.

Nearby Otahuhu's main street retailers were doing it tough but still better than expected, local business association manager Richette Rodgers said.

"Every shop reopened after the Covid lockdown - that was step one," she said.

"Now step two is keeping them open."

The lockdown had been a particular trial for older, less tech-savvy shop owners.

Rodgers said just six main street retailers had websites and were able to conduct "some kind of online trade" during the loosening of restrictions to level 3 and level 2.

Yachts anchored at Tryphena Harbour in Aotea Great Barrier Island during New Zealand's level 4 lockdown. Photo / Will Trafford
Yachts anchored at Tryphena Harbour in Aotea Great Barrier Island during New Zealand's level 4 lockdown. Photo / Will Trafford

Even less had click-and-collect payment or Uber delivery options.

Still, they innovated, often setting up new Facebook pages and taking photos of their menus each day and posting them online, Rodgers said.

Aotea Great Barrier Island - on the outer edge of Auckland's Hauraki Gulf - was the surprise good news story. Spending was up 38 per cent - the highest in the country.

Jocelyn Bellervy, owner of Stonewall Store which stayed open during lockdown as the island's essential services grocery store, said she was busier than last year.

However, because she had absorbed higher freight costs during lockdown, she was doubtful she had brought in a higher profit.

Izzy Fordham, the Auckland Council local board chair for Great Barrier, estimated the island's population had swelled from about 1100 to 1500 during and after lockdown.

That was because people who owned Great Barrier homes but lived mostly in Auckland spent long periods on the island and yachties anchored off the coast to self-isolate during lockdown.

It meant that, apart from its tourism businesses, the island was doing well.

"The majority of our people retained their jobs, including our Department of Conservation contractors," Fordham said.

"We're really happy about that."

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