For eight Sundays, between 22 July and 9 September, shops with a floor space of over 280m2 will not be subject to the traditional “Sunday hours” restrictions.

For eight Sundays, between 22 July and 9 September, shops with a floor space of over 280m2 will not be subject to the traditional “Sunday hours” restrictions.

Legislation dating back to 1950 stipulated that shops were to be “closed for the serving of customers on a Sunday”, which then reflected the mood of the nation. All changed in 1994, when small shops had the restrictions removed, while those with floor space over 280m2 were restricted to opening for a maximum of six hours between 10am-6pm.

The latest change is intended to maximise the opportunities that the Olympics present, and to show visitors that the UK is “open for business”. It has also reopened the debate as to whether the traditional restrictions are out of kilter with today’s 24/7 retail world.

A 2006 Government-commissioned DTI cost-benefit analysis on relaxing the Sunday trading laws firmly rejected any change, citing no substantial consumer demand. Further policy consultations and a bill placed before parliament last year had no success. The Business Minister, Mark Prisk, stated that the latest relaxation “is a temporary measure and not a test case for a more permanent relaxation of rules in the future”. Many believe however that this will actually be a testing ground for more permanent change and battle lines are already being drawn.

In the meantime, what will the impact of the change be? London is likely to have a different experience to the rest of the country. Olympic visitor numbers must mean an increased footfall to our capital’s shops and longer trading hours will almost certainly be of benefit - increased sales are estimated at £220m. Outside London, while consumers may welcome extra choice, actual sales may not increase proportionately to the cost of keeping the stores open longer. Shops not benefitting from visiting “Olympic” custom may face the problem that, with disposable income under continued pressure, footfall and spend may simply spread out over the extra hours available, rather than increase.

Retailers will need to consider carefully the added administration and running costs of extended opening hours for one day - energy use, unpredictable waste from perishable goods owing to the novelty of the situation, and staff costs. Similar issues faced the pub industry following the relaxation of licensing laws a few years ago but, at least in that case, the change was permanent.

The relaxation of “Sunday Hours” also brings a host of employee considerations - standard employment contracts may not allow an employer to require staff to work outside the usual 10am-6pm Sunday boundaries, so work-arounds may be necessary. Staff in stores affected by the change also now only need to give two months’ notice (it was previously three) of their wish to opt out of Sunday working for the Games period, being able to give such shortened notice at any time up to 9 July. Employees employed prior to 26 August 1994 cannot be forced to work on a Sunday in any event.

Property elements should also be considered around restrictions in leases on opening hours, obligations to trade during hours specified by shopping centre management etc.

So, to open or not to open? That is the question.

Will the decision to extend opening hours during the Olympic period solely rest on a cost/benefit analysis of the actual cost of opening vs sales increase at that store? Can it be that simple an equation?

For example, will the increased hours also feed online sales (extra opportunity to touch and feel goods before purchasing online, or widening the click and collect net?) or simply enhance brand over and above the competition by providing the more convenient shopping experience for the customer? Further, research into shopping habits on Sundays has shown a tendency towards leisure shopping, rather than targeted purchases.

Will the prize be worth the pain?

  • Andrew Shufflebotham, Partner and Head of Retail and Consumer at Addleshaw Goddard LLP