Who Benefits? Amazon Booms as Lockdown Crushes Small Business in Britain

Amazon and Blue Origin founder Jeff Bezos provides the keynote address at the Air Force Association's Annual Air, Space & Cyber Conference in Oxen Hill, MD, on September 19, 2018. (Photo by Jim WATSON / AFP) (Photo credit should read JIM WATSON/AFP via Getty Images)
JIM WATSON/AFP via Getty Images

Reform Party leader Nigel Farage warned that the UK is heading towards “mass business bankruptcies” and “massive unemployment”, while Jeff Bezos and Amazon reap the rewards of Prime Minister Boris Johnson’s second national lockdown.

During the Chinese coronavirus pandemic, Amazon has seen its profits in the third quarter triple to $6.3bn (£4.8bn), with a 37 per cent rise in sales globally, thanks in large part to lockdowns introduced by governments across the globe preventing consumers from visiting physical shops.

In the UK, the tech giant is planning to hire some 20,000 seasonal workers during the Christmas period, while many small businesses remain shuttered and under lockdown.

The founder of the consultancy firm NBK Retail, Natalie Berg told The Times: “Amazon has had Christmas handed to it on a silver platter,” adding: “It’s the hands-down winner of the pandemic.”

Reform Party Leader Nigel Farage said on Monday that his email is “chock full” of “letters from small businesses letters from sole traders letters from shopkeepers and they all say the same thing they don’t think they can survive this second lockdown.”

“We’re headed towards mass business bankruptcies, we’re headed towards massive unemployment, it will be even higher, far higher in fact, than it was back in the early 1980s,” he warned.

“At the same time, who are the beneficiaries? Well close down the shops, you want to buy something, where do you go… Amazon. So the richest man in the world gets richer and the millions of you out there who’ve taken the chance to go on your own to do your own thing are being crushed,” Farage concluded.

A survey conducted by the Local Data Company and the accountancy firm PWC found that over one in eight (5,552) of British retailers with more than 5 outlets, has remained shuttered since the first lockdown in March. Over 2,000 of such retailers reported that they have closed permanently.

A separate report found that approximately 46 per cent of small business owners will be cutting staff over the next six months, and two-thirds said that they will not be hiring more workers amidst the uncertainty of future lockdowns.

Britain’s high streets have also been hard hit by the lockdowns, with some 1,833 independent high-street businesses shutting down since the start of the pandemic.

Meanwhile, Amazon is planning on opening dozens of “checkout-free” convenience stores and is planning to open brick and mortar bookstores as well as “4-star” shops that sell anything with over a 4-star rating on its website.

“We are investing heavily in creating jobs and infrastructure across the UK — more than £23bn since 2010. The UK has now become one of Amazon’s largest global hubs for talent and this year we announced plans to create 10,000 new jobs in the country by the end of 2020, taking our total workforce to more than 40,000,” Amazon said in a statement.

A former director of operations at the high-end department store chain John Lewis, Dino Rocos warned that that the Christmas season will be a “bit of a bloodbath” for small businesses across the country.

“Amazon will be able to ride through the peak more comfortably than high street retailers, who will struggle to drive sales online after Black Friday because of capacity constraints,” Rocos said.

The owner of a department store in Middlesbrough, Steve Cochrane, said that he had paid for 14 projectors and received £48,000 on Versace and Dsquared perfume gift sets for a Christmas window display, saying: “We were just starting to get back a bit of confidence.”

With the introduction of the lockdown, Cochrane was forced to abandon his plans, furlough his staff, and leave £5 million worth of Christmas products locked up.

“I’ve been waking up in the middle of the night, furious about how stupid this is. This lockdown will be so much more damaging than the last one, and it’s playing massively into the hands of Amazon and the other e-commerce retailers, which pay little rent or business rates,” Cochrane said.

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