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Jun 20, 2020

Indigo CEO: Feds must act amid COVID's 'seismic' threat to retailers

Indigo CEO calls for 'truly low-cost loans' from the feds for retailers

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The chief executive of Canada’s largest bookstore chain is urging the federal government to wake up to the magnitude of the pandemic’s impact on retailers, which has already forced Indigo Books & Music Inc. to shutter almost two dozen of its smaller-format stores.

Heather Reisman, CEO of Indigo, told BNN Bloomberg Friday that the situation is dire looking ahead to the key holiday season.

“The depths of the losses we are looking at are literally as seismic as this COVID event is to the world,” Reisman told Amanda Lang, pointing out she’s staring at the possibility of store traffic being only one-third of what’s normally a “chock-a-block” time of year.

Her comments come as the pandemic batters retailers across the country, with the latest data revealing a historic drop in retail sales in April amid nationwide closures of non-essential services.

Reisman said the crisis has forced her to make some “very difficult decisions,” including the closure of some Coles stores.

“We have closed 20 stores which were either not profitable or very, very marginal. That was a tough decision because in those communities, we were the only bookstore, and I suspect the only store that was willing to operate at a loss to serve the community,” she said.

Reisman also criticized what she describes as a lack of understanding on the part of the federal government when it comes to the current challenges retail CEOs are up against.

“What our Canadian government does not seem to understand is that the job of the CEO is to look forward and to manage ... the challenges coming at us in the best way,” she said. 

Reisman repeated her call for more aid from the federal government for retailers in the form of “truly low-cost loans” or a further extension to its wage subsidy program.

“What we need … is very affordable low-cost loans to get us through two years, which is a small give on behalf of the government,” she said.

“Or sustaining their current employer-employee top-up program, which allows us to bring people back to work.”

Reisman warned that the government risks stalling the country’s economic recovery if it does not provide more relief to the sector.

“If the Canadian government is cavalier about jobs at this moment, it will take a half a decade for them to come back. Half a decade,” she said. “So I’m pretty sanguine today. I’m a little bit frustrated.”