Retailers Association of India (RAI) along with Trust for Retailers and Retail Associates of India (TRRAIN) organized a Webinar on ‘Retail 2020: Reset. Recover. Revive’, the third in the series of webinars focused on impact of COVID-19. Following are the key takeaways:
Impact on consumers
Drastic Change in consumer behaviour
There was an initial assessment that Covid 19 will not necessarily impact the consumer behaviour. However, the industry has been witnessing the drastic shift in consumer behaviour. Now consumers are pulling back in order to save enough to get through this.
Food will continue to remain strong category
Initially Covid has caused panic buying for food and other essential items right from China to Europe and then United States. Then, ecommerce crisis across the world adds the fuel. Now experts are predicting that shopping pattern will change conspicuous consumption will disappear, food will remain strong,
Online will get better traction
Consumers are changing and they’ve started to realize the importance of retail. More consumers are adopting ecommerce and this change could have lasting effects.
Impact on Retail Businesses:
Non-food Retailers can see bankruptcy
A survey conducted by RAI predicted that 20-25% of retailers will not be able to survive even the next three months of closures. There was more than 1500 retailers were the part of this survey. On the non-food side, stores have been closed for over 3 weeks. Wealthiest countries are predicting 30-40% bankruptcies.
Emphasis on cash and rethinking businesses
Survival is the critical issue for all of retail right now, particularly small businesses and non-essential retailers. And to them, Survival means cash. Across the globe, right now emphasis is on cash and rethinking businesses.
Mid-sized retailers are worse hit
The retailers in the middle have the biggest problem at hand, because the smaller retailers can potentially expect help from the government and the larger corporations can take care of themselves. Those in the middle are stuck with no backing or ability to help themselves.
·Guidelines for Retailers
Focus on building Trust
Communicating is extremely crucial.
This is also the time that brands can really build value for themselves. For instance, brands helping the community by making asks or some other assistance will go a long way in creating value in the minds of consumers.
Keeping the supply chain going is extremely important for retail companies.
What America did for its retailers: Payments to consumers and unemployment support through existing system. Support to small businesses. Today, a official note from RAI reads as, “ The banks are not giving any kind of finance to retailers although RBI has stepped in. It is not happening on ground.
The way that the developed economies and the larger economies have treated in terms of relief packages and fiscal policies with retailers and SMEs is different from emerging markets like India and South Africa.
Defining the term ‘essential’ is extremely crucial. Restricting it to just food and pharmaceutical products is not the right way to go about it.
Most retail bodies across the globe are asking governments for a gradual opening up of non-food essential stores.
Everyone is going to pull back from their consumption. And for those at the low-income level we will have to create a kind of demand to get the economy moving. It’s going to be about stimulus. Stimulating the economy is going to be the next phase. Right now it’s about relief.