Transition to COVID-19 alert level 3 a 'lifeline', 'shot in the arm' for hospitality and retail business - industry leaders

Almost a month after thousands of businesses were forced to close, the level 4 lockdown is set to be lifted in one week.

Following Prime Minister Jacinda Ardern's announcement that COVID-19 alert level 3 will take effect at just before midnight on Monday, April 27, leaders in the hospitality and retail industries say it's welcome news for businesses struggling for cash flow.

Restaurant Association of New Zealand chief executive Marisa Bidois said that moving to alert level 3 represents a "lifeline" for some hospitality business owners in what is otherwise a dire situation for the industry.

"With fixed costs unable to be paid, opening up takeaway services allows them to generate a small amount of revenue," Bidois said.

She said that as the hospitality industry is used to working within food control plans, the additional measures are achievable. Delivery standards for takeaway orders are still being worked through, but contactless payment, distancing and disposable packaging including coffee cups, will be the norm.

"Reduced menus, minimal staff, additional hygiene standards and online ordering systems won't be an issue to put in place.

"People can expect to pick up orders from outside the establishment, or have orders placed at their door," Bidois added.

Not all food service businesses were set up to provide takeaway services but customers may see a flood of new options in this area.

"Whilst takeaway won't work for all, there are a number of businesses that are currently working on making these changes to enable them to operate," Bidois added.

Referring to alert level 3 as "a small shot in the arm" for the retail sector, Greg Harford, chief executive of Retail New Zealand, said that although opening up online trading means customers get the things they need, overall spending will continue to be subdued.

"Lots of customers have needed to buy products over the last month [and] have been unable to do so because they've been deemed 'not essential'.

"We would expect to see a short-term boost for retail compared to level 4 - but expect retail trade to be substantially down compared to normal," Harford said.

Customers using click and collect services are likely to find the process different from the pre-COVID days of simply popping into the store.

"It may mean customers need to queue up in car parks while maintaining social distancing [and] potentially check-in for a collection time, or phone to have goods brought outside," Harford said.

As click and collect services will need to be contactless, some stores will provide online shopping only, meaning customers will pay a delivery fee. 

"Not all businesses will be able to operate contactless click and collect, and these businesses will likely focus on online delivery," Harford added.

In Monday's announcement, Prime Minister Jacinda Ardern said that New Zealand has stopped "a wave of devastation."

"Our transmission rate is now 0.48 - less than half a person each: overseas, the average is 2.5 people," Ardern said.

Since the start of the month, almost every positive case was a result of overseas travel, contact with a confirmed case or through an existing cluster. Around 85,000 New Zealanders had been tested and random testing of over 1000 people had so far found no cases.

The country will move out of alert level 4 lockdown at 11.59pm on Monday, April 27 and will stay at alert level 3 for two weeks, with a further decision expected on May 11.

"This week, businesses will be allowed to get ready to open, such as employers re-entering premises to receive stock, if necessary," Ardern said.

"But we ask that in doing so, they stick to social distancing and their bubbles."

A level of trust will continue to operate under level 3, and although Monday's announcement is not an invitation to trade, it's recognised that business owners will need to prepare.

"In order for people to get started, some of them just on their own, need access to their premises.

"Our view was that it could be done safely, and we have faith in our operators to do that," Ardern added.

In addition to talking to industry representatives, business owners can contact LINK for help with creditors, debtors, landlords and raising capital during COVID-19. The free business support line is 0800 546 569.