Lockdown 4.0: Ambiguity in local level interpretation of laws a challenge for retail industry

Lockdown 4.0 guidelines which allow opening of non-essential stores, depending on their locations and State government directives, have so far been a mixed bag for the retail industry. While States have issued their own set of directives, post the issuance of guidelines by Ministry of Home Affairs last week, interpretation of laws at the local level has been ambiguous, said industry players. At the same time, retail industry has been urging the Central government to allow opening of malls.

Rahul Mehta, Chief Mentor, Clothing Manufacturers Association of India (CMAI) said there is state of confusion with regards to interpretation of Central and State directives at the local level. “Many large format standalone stores on high streets are not being allowed to open as such stores are being defined as malls. There have been instances of large standalone stores, which sell multiple brands, being asked to close within 2-3 days of opening,” he added.

A senior executive with an apparel store chain said, “As we have large format stores, with several floors, many local level authorities are not allowing us to open our stores in many States. They need to understand the distinction between a mall and a large format standalone store.”

In addition, some State governments and local level authorities are not allowing stores to operate air-conditioning and asking them to shut down if air-conditioning is operating. In a tweet on Thursday, B S Nagesh, Chairman of Retailers Association of India (RAI) said that if air-conditioned airports and flights can operate and air-conditioned offices can open, why air-conditioned large stores and malls are not allowed to open and operate.

“We cannot have a one size fits all solution. For instance, number of customers being restricted to five even in large format stores is very impractical. There is also a lot of ambiguity in interpretation of laws at the local level,” said Kumar Rajgopalan, CEO, Retailers Association of India.

Organised retail industry has also been urging the government to allow malls to open as part of its efforts to kick-start the economy. Amitabh Taneja, Chairman, Shopping Centres Association of India (SCAI) said, “Shopping centres can provide a safe and hygienic environment with 100 per cent accountability and enforcement of social distancing norms. The shopping centres have the ability and resources to enforce the best protocols in a far more efficient manner than many others who have benefited from the relaxation.”

Meanwhile, non-essential stores that have opened are witnessing pent-up demand from customers. Sundeep Chugh, MD and CEO Benetton India said, “In line with the government guidelines, we have opened majority of our stores in high street areas under the green and orange zones in cities and witnessing footfall. The conversion rate in these times has increased to 80-90 per cent as customers who have a clear intention of buying are entering the stores and our wide portfolio helps people shop from a single destination, thereby eliminating the possibility of multiple trips.”

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