‘Chaos’ warning over liquor rules
Traders say limited opening times will be counterproductive
Sean Robinson of the Liquor Traders Association of SA says government conditions for the reopening of liquor outlets when level 3 comes into effect, supposedly in June, are a recipe for disaster.
They will lead to "chaos" and be "completely counterproductive" in terms of containing the spread of the coronavirus, says Robinson.
The association represents more than 1,400 independent store owners and operators nationwide, who employ more than 14,000 people.
The government notice for level 3 liquor regulations says stores can open for only four hours a day, from 8am to midday, three days a week, and puts a tight limit on how much they can sell to each customer.
There's been a ban on alcohol sales since March 27, supposedly to limit the spread of the coronavirus. But, says Robinson, "the risk of the spread of the virus is not going to be mitigated if those hours are imposed. It's going to be multiplied".
He predicts a crush of desperate customers trying to get into the store and make their purchases in the small window of opportunity that trade and industry minister Ebrahim Patel has stipulated.
Patel has placed the onus on the R30bn liquor retail industry to come up with a plan for social distancing.
But Robinson says Patel's conditions will make social distancing "extremely difficult to manage". His fear is that if outlets don't ensure social distancing, the government "may immediately ban liquor again".
"Another real fear is the frustration of customers queuing and the potential for the boiling over of anxiety leading to violence and looting if you've been waiting all day and then still not been able to get what you want when the store closes.
"There's a real danger of things getting totally out of control."
Another real fear isSean Robinson
the frustration of
and the potential for
violence and looting
Liquor Traders Association of SA
He says that the limited quantities stores will be allowed to sell to each customer under Patel's rules will encourage them to shop more frequently, "which also doesn't make any sense if you're trying to restrict the spread of the virus".
All this has been pointed out in a detailed plan sent to the department of trade & industry (DTI) by the Liquor Traders Association, which proposes trading between 9am and 6pm from Monday to Friday, and from 9am to 4pm on Saturday, and easing the restrictions on how much can be sold to each customer.
Apart from facilitating the spread of the virus and creating the potential for violence and looting, allowing outlets to sell for only 12 hours a week will make it hard for them to be financially viable.
"There's going to be very significant demand in those 12 hours the government will allow, but you've still got your fixed overheads like rent and your staff complement, and all the other costs that would typically apply across a full week, not just 12 hours," he says.
"Some of our members have said they won't even bother opening if that's the situation because it wouldn't be financially viable."
Most outlets, however, are "desperate" to open even if it is for only 12 hours a week, because much of their stock is close to its sell-by date, after which it will have to be dumped.
"One of the big concerns is that we're going to have stock expiring soon in stores."
Craft beers and ciders that have a relatively short shelf life will begin to expire in the next month, he says.
"So they're desperate to start moving some of that stock to prevent the financial ruin that would cause."
Sitting on stock they've paid for that would have to be written off unless they've got agreements in place with their suppliers is "possibly the most pressing issue right now for independent retailers", he says.
"That would be catastrophic for most of the smaller independent stores."
Robinson says their proposal, which was e-mailed to the department, was ignored. There wasn't even an acknowledgment of receipt. He had to request one.
Eventually, they acknowledged receipt and said they'd respond to the proposals in due course, but they didn't.
"We've found it exceptionally difficult to communicate with the DTI since the lockdown began," he says.
So far, there has been "no engagement" with the department over their proposals.
"In spite of us trying to reach out and propose what we feel are real, workable solutions, we really are not sure if any of those proposals have been considered or are likely to change anything. We haven't had any feedback."
Meanwhile, D-day looms. But nobody, least of all Robinson and the industry he represents, knows yet when it will be.
There's no certainty when level 3 will happen, he says.
"We're relying on what President [Cyril] Ramaphosa said in his address, which was very vague. Hopefully, in early June we'll be able to trade but we don't have a date, we haven't been told anything specifically."
This is a growing concern, he says.
"It's obviously going to take some time to get ready for this opening day because the last day that we traded there was significant panic buying, with lots of people purchasing lots of stock."
Because of this and "substantial" looting during the lockdown, many stores will need to do major restocking, but can't move too soon because they could be saddled with prohibitive security costs.
"So we do need notice."
Robinson, 45, is joint MD with his brother Craig of the family-owned Ultra Liquors, one of the largest independently owned retail/wholesale liquor businesses in the country, with 30 stores and 40 franchisees nationwide.
They relied on the Unemployment Insurance Fund's Covid-19 Temporary Employer/Employee Relief Scheme to keep their more than 1,000 employees paid during the lockdown but haven't received a cent.
In spite of this, they managed to pay staff full wages in April and will pay reduced wages in May.
The longer the ban continues, the harder it will be to pay them anything, he says. This applies even more so to smaller businesses which have reached breaking point.
They urgently need to know when trading will resume, even if, thanks to Patel's restrictions, they still won't be able to cover their costs.