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EDITORIAL How is Covid-19 accelerating change in retail?

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EDITORIAL How is Covid-19 accelerating change in retail?

In many eyes, Covid-19 is speeding up the pace of change across society. We’re seeing that in retail too, where high street shops are now closing faster than ever. This week administrators said they could not find a way to keep Oasis and Warehouse running as a going concern. Their shops and concessions are now closing for good, with the loss of 1,800 jobs, adding to the growing total of shops that won’t open again after the lockdown. That’s a direction that we’ve seen developing over recent years, with 10,000 shops estimated to have closed in the UK in January 2020 alone, before the coronavirus pandemic emerged.

 

At the same time, sales are moving online faster than they ever have. Sainsbury’s, which reported full-year results this week, has expanded its delivery capacity by about 50% and it expects to grow it still further. eBay says lockdown has meant a boost for its marketplace sales.

 

This pace of change has come at a high cost. Online retail giant Amazon says even though its sales are growing, its shareholders should not expect to share in any profits in the short-term since it is spending billions on raising wages, protecting staff and ensuring that customers still get served. Similarly, Sainsbury’s has also warned of higher costs. eBay, meanwhile, says that its marketplace business is growing, but its classified advertising business is slowing.

 

Forrester is predicting a double digit drop in UK retail sales in 2020, slightly higher than the expectation that world retail sales will fall by 9.1% over the same period, as we report in our rolling coronavirus round-up.

 

From here perhaps it’s possible to start predicting how things will change in the future. We already know that social distancing measures are likely to slow the bricks and mortar store experience significantly, with customers likely to continue to need to queue to get into shops. That should mean online becomes an even more convenient option by comparison – as long as retailers can expand their capacity for home delivery. In today’s rolling coronavirus story we report as small businesses move their focus towards online.

 

Today’s guest comment comes from Derek O’Carroll of Brightpearl who advises on why retailers now need a long-term IT strategy - and on how to implement it – and we also report as AO introduces address mapping technology to reduce its failed deliveries.

 

 

Image: Adobe Stock

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