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Impact Of COVID 19 On Retail Sector & Key Learnings For The Future
Consumers are staying home and from shoes, clothes, to groceries, and everyday use items, they are relying on e-commerce and brand websites sites to make their purchases.
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COVID 19 has transformed our lives, the world we live in forcing governments across the world to implement lockdown. Pushing us indoors for month, the health crisis has adversely impacted businesses triggering a global economic slowdown. Needless to say, people-facing sectors like retail witnessed an immediate slump. With shops being closed to ward off the crisis, sales and manufacturing have plummeted to an all-time low. In the first two months of lockdown the organized retail sector has borne losses to the tune of ₹90,000 crore. While revenues have been nil expenses like EMI, rent, staff salaries etc. added to the woe.
Fortunately, the lockdown is easing in several parts of the country and non-essential shops are getting back in business. However, it will take a while for the retail sector to get back to ‘business as usual’. According to Ernst & Young perspective on the key retailer issues and the resilience strategies, to mitigate the disruption caused by this crisis, Indian retailers will need to devise strategies for the “now”, “next” and “beyond”. While they need to manage their costs through operational improvement and by valuating the store portfolio, they should also invest in service, experience, and omni-channel to serve the new consumer.
This pandemic has changed the consumer behavior. Health concerns have compelled people to live differently, think differently and in many ways buy differently. Consumers are looking at products and brands through a new lens. The factors that influence brand decisions are also changing as “Buy Local” trend accelerates. In fashion category for the time being, retail stores will see moderate customer footfall but there will be a surge in online sales which is already evident from the current situation. Online adoption will continue to accelerate beyond the crisis as well.
Health and safety concerns are predominant in consumers mind leading to a boom in online marketing and e -commerce activities. Consumers are staying home and from shoes, clothes, to groceries, and everyday use items, they are relying on e-commerce and brand websites sites to make their purchases.
These are challenging times indeed and retailers need to take these actions immediately to navigate through this unprecedented situation:
- Adopt a flexible and agile retail model
- Shift from Business Continuity to Crisis Management
- Manage the supply constraints
- Deal with the decline in consumer confidence and try to infuse confidence
- Cope with staff shortages and drop in demand
- Plan for the long haul
While the situation on-ground is evolving every day, we must work together, put the consumers’ interest first and hope to come back to normalcy soon while riding this wave with extreme precaution. This pandemic should act as a trigger for the retail sector to focus on building flexible and agile business and operational models that can counter such disruptions in the future. This would also mean increased focus on digital and online models going forward. We should now focus on moving ahead of the crisis and building more resilient organizations.
Being a homegrown company, how Red Chief is supporting the campaign ‘Vocal for Local’ Our end- to-end process from footwear design, procuring raw material and manufacturing using state of the art technologies, everything is done in India. Our design team is well equipped with world class design studio where a team of experienced national and international designers are constantly working together on modern and technologically advanced software, to develop better and innovative designs.
Further to support local for vocal – we are also engaged with local suppliers and manufacturers. We have partnered with them to fulfil our business requirements along with educating and developing them to achieve fast, cost effective and best quality output.
Our Distributors and Retailers pan India is now successfully dealing with the crisis by taking good care of customer health concerns while following all desired safety measures which is boosting customers confidence and they are also getting footfall back from their loyal consumers.
For the weeks to come, our objective is to resume business operation in full swing while maintaining the safety of the staff and customers as top priority.
Disclaimer: The views expressed in the article above are those of the authors' and do not necessarily represent or reflect the views of this publishing house. Unless otherwise noted, the author is writing in his/her personal capacity. They are not intended and should not be thought to represent official ideas, attitudes, or policies of any agency or institution.