World Retail Congress 2019

 

View from Italy: Richard Simonin

23 Apr 2020

View from Italy: Richard Simonin

Richard Simonin

Richard Simonin, turnaround retail CEO has provided his thoughts on the current situation in Italy, two weeks on from his first report.

To view the full second issue of 'The Retail World 2020: Retailing in a Time of Crisis', please click here.

Firstly, I don’t believe people are learning the lessons or studying the evidence from what has happened elsewhere, particularly China. There have been so many conflicting statements from experts and we are understandably focused on the economic impact and our desire to bring this crisis to an end. This could lead to a dangerous relaxation of the lockdown before it is proven there is a good level of control of the pandemic.

My conclusion is based on the best available data. It has taken Italy 44 days to reach R = 1 on April 21st despite still recording 107,709 active cases. “R” is the Effective reproduction number, numerator being Daily number of Newly Infected people, denominator being Daily number of Newly Recovered people.

Sources: WHO and https://worldometers.info/coronavirus

China - focusing on Hubei/Wuhan and surroundings with approximately 60 million people, comparable to the Italian population, reached R = 1 in 23 days with 58,016 active cases. China kept the FULL lockdown for an additional 24 days during which they have been keeping R below 1 every single day bringing down the number of active cases to 12,088 on March 13th, first day of a very cautious and progressive release. On April 13th, i.e. after an additional 31 days the full lockdown released happened with only 1,089 cases remaining.

In contrast, Italy wants to start the progressive lockdown release on May 4th i.e. only 12 days after reaching R=1 with an estimated number of remaining active cases in the range of 60,000 to 80,000? 

Italy is actively paving the way for a potentially dramatic second wave with much bigger potential economic and social consequences than the first one.

France and Spain are unfortunately following a comparable track.

If I am proved wrong, this will make me the happiest human being on earth.

As of today, Germany is the ONLY one of the main European countries which has the situation under control.  R=1 has been reached on April 8th and has been kept below 1 since then. 

May 1st, 24 days after reaching R=1, Germany will be at a comparable control level with China. This is the absolute prerequisite to starting a potentially successful lockdown release.

What does this all mean for retail business? 

As it is too late to postpone lockdown releases which have been widely announced by Governments, I would suggest we consider two options which we can address separately or together:

Option 1: Let’s pray, as advised by BS Nagesh in issue one of this report or,

Option 2: Mobilise strongly and immediately our teams to involve them in the preparation of a sound Plan B so that, if we see a tsunami-like second wave emerging, we can react extremely quickly and appropriately to avoid the worst-case scenario and minimise additional collateral damage.


 

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