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* Clothing retailer Next shuts down online business
* Rivals such as M&S, ASOS, Boohoo still operating online
* Basic and comfortable clothing in demand
(Adds Boohoo, Next pay details)
By James Davey
LONDON, March 27 (Reuters) - Leading British fashion chain
Next has bowed to pressure from workers worried about
their health and shut its online business, cutting off its
remaining source of revenue during the coronavirus outbreak.
Rival British retailer Marks and Spencer has taken a
different tack, maintaining its online operations and citing
government advice that people should use home delivery services
to avoid going out if possible.
Next closed all its stores on Monday, a day before Britain
went on lockdown, but had continued to run its online business,
which accounts for around half of group revenue.
Next shares slumped on news it was shutting the online
operations and were down 8.7% at 41.16 pounds at 1215 GMT.
"Next has listened very carefully to its colleagues working
in warehousing and distribution operations to fulfil online
orders. It is clear that many increasingly feel they should be
at home in the current climate," the company said.
"Next has therefore taken the difficult decision to
temporarily close its online, warehousing and distribution
operations," the company, whose Chief Executive Simon Wolfson
represents the ruling Conservative party in the upper house of
parliament, said.
A number of retailers are having to scale back or halt their
online activities to try to safeguard their workers' health.
Amazon.com said last week it would stop shipping
non-essential products to consumers in Italy and France, due to
a spike in orders and the need to respect anti-coronavirus
safety measures in the workplace.
BACK TO BASICS
Other fashion retailers in Europe are trying to keep their
online businesses going, saying they are confident they can
ensure social distancing.
Spain's Inditex, the company behind the Zara brand,
has also said its online business remains in operation.
Pure online fashion retailer ASOS, which has a
large fully automated warehouse in the northern English town of
Barnsley, with on average 300 people per shift, is also still
running.
Rival Boohoo said it is carrying on, utilising its
two distribution centres in Sheffield and Burnley, also in
northern England.
However, people's orders reflect the current crisis.
Items currently selling well include everyday basics such as
socks, underwear, leggings and children's wear, an M&S
spokeswoman said.
That echoes comments from Europe's biggest pure online
fashion retailer Zalando which said this week that
demand for athleisure and gear for yoga and running has risen as
people are forced to work – and exercise – at home.
With all of Britain's shops closed due to the virus, apart
from food stores, pharmacies and corner shops, there has been a
growing backlash against retailers who continue to sell online
from trade unions and others on concerns about workers' health.
Next said last week it could sustain a hit from coronavirus
of more than 1 billion pounds ($1.2 billion), or 25% of annual
sales, without exceeding its debt and bank facilities.
Next said in a letter to staff late on Thursday that its
warehouse and distribution staff will be paid their full
contracted basic pay until April 11. They will then fall under
the UK government-backed job retention scheme, announced last
week, amounting to 80% of basic monthly pay.
($1 = 0.8194 pounds)
(Reporting by Pushkala Aripaka in Bengaluru and James Davey and
Keith Weir in London; additional reporting by Sonya Dowsett in
Madrid; Editing by Kate Holton/ Mark Potter/Susan Fenton)
