As we verge closer to the second anniversary of the Covid-19 outbreak, we’re finally able to start really seeing the effects the pandemic has had on various sectors. Retail, specifically, may have changed for good, in more ways than one. Three nationwide lockdowns have meant all non-essential shops have had to close three separate times, and even those that continued to operate were faced with reduced hours, reduced capacity, and a wildly different way of doing business.
But now things are starting to open back up, what changes can we expect to continue into the future? Industry trends are already pointing towards a new day for the retail industry.
Rise in ecommerce
Ecommerce was already increasing at a steady rate before 2020 but, by the time the pandemic hit the world, the worth of ecommerce sales worldwide rose from £2423bn to £3091bn. Global lockdowns no doubt had a role in this extreme boom, with more and more people shopping online for anything they could possibly need — whether that was groceries, new clothes or even gym equipment. And now we’re used to the convenience of shopping online, chances are that more people will continue to shop this way, even when Covid-19 is a distant memory.
This rise in online shopping also comes with a greater expectancy of fast shipping at a reasonable price. A study found that the two most common reasons shoppers abandon their carts is due to the delivery options — either the cost is too high or the expected waiting time is too long. For a retailer, investing in delivery options and prices may well be the aspect that encourages new customers to shop with them, and keeps them coming back for more. Working with a dedicated courier service, rather than relying on the often slow Royal Mail delivery service, could work in their favour. Almost all courier companies, such as CitySprint, offer next day delivery as standard, at an affordable price. This means customers won’t be put off by any extortionate prices and wait time is kept to a minimum.
As well as being generally faster, contactless payments eliminate the need for dealing with physical cash, which is notoriously filthy. So rather than having to wash notes and change, and constantly sanitise hands after use, it makes much more sense for consumers to stick to one card that doesn’t leave their hands. In 2020, the total number of contactless payments made in the UK rose by 12% to a mighty 9.6 billion payments, accounting for more than a quarter of all payments made in the country. As well as this, more people are relying on smartphones and watches to make their payments, providing yet another cashless alternative.
And this trend for going cashless is extending from grocery shopping to wherever you can possibly make a purchase — including festivals. Pre-covid, theft was touted as being the biggest safety concern amongst festival-goers, who would often carry enough cash to see them through the entire duration of the festival. But the gradual move into a more contactless society is seeing even the biggest festivals, such as Reading & Leeds, switch to a completely cashless event. Any retailer must start looking at offering a seamless switch from physical cash payments to a contactless experience — and preferably one which doesn’t require a minimum spend.
Diversified supply chain
The pandemic saw the different countries lockdown at various times and at multiple points since the virus first broke out. This massively disrupted the world’s supply chain across almost every industry. Factories had to shut down due to local lockdowns which meant both raw materials and specific parts couldn’t be processed, manufactured, or even shipped out to other countries. This led to postal services being under pressure to deliver the goods, causing a huge delay in shipping times. But by having companies diversify their supply chain, these problems may be avoidable in the future.
Diversification requires reassessing supply networks, ensuring they meet the challenges that Covid-19 triggered. This includes aspects such as “near-shoring” which uses suppliers closer to home rather than on the other side of the world, and “on-shoring” which moves supply chains within domestic markets. These are especially helpful for UK retailers and business owners dealing with the aftermath of Brexit and navigating through the various restrictions now in place.