{"id":1906,"date":"2020-05-13T20:51:00","date_gmt":"2023-09-04T20:51:32","guid":{"rendered":"https:\/\/www.salesforce.com\/?p=1906"},"modified":"2023-11-04T12:02:21","modified_gmt":"2023-11-04T12:02:21","slug":"how-do-retailers-respond-in-a-covid-19-world","status":"publish","type":"post","link":"https:\/\/www.salesforce.com\/eu\/blog\/how-do-retailers-respond-in-a-covid-19-world\/","title":{"rendered":"How Do Retailers Respond in a Post COVID-19 World?"},"content":{"rendered":"\n

A mere three months ago, the word \u2018Coronavirus\u2019 was not a part of the national vocabulary. In the world of retail, we were discussing a record-breaking digital holiday period, analysing peak performance, and thinking about the impact of Brexit negotiations on the supply chain.<\/p>\n\n\n\n

However, since the outbreak of the COVID-19 pandemic, the virus has dominated news headlines and impacted all of us, in large and small ways. As a sector, retail has been hit hard, but has also risen to the challenge, from grocery workers at the front line to luxury brands donating masks, gowns, hand sanitiser and repurposing factory lines to support government efforts.<\/p>\n\n\n\n

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Retail has been hit hard<\/b><\/span><\/h2>\n\n\n\n

Ever since the UK government mandated the closure of non-essential businesses on March 26th, retail has been hit significantly (with the exception of grocery). Retailers have seen a fall in their revenues, due to store closures. Luxury and clothing are hit the hardest, with clothing recorded at a 35% drop, according to the Financial Times<\/a>. Some retailers like Laura Ashley, have sadly gone into administration.<\/p>\n\n\n\n

In April, the Office for National Statistics (ONS) revealed a 5.1% drop in retail sales in March. The ONS figures are the first hard indicator of the period partially covering the lockdown- and the highest drop ever recorded by the ONS since it began nearly 30 years ago. Customers are spending much less, and with the resulting impact on the UK economy predicted, consumer confidence is low, and retailers are going to have it tough.<\/p>\n\n\n\n

In addition to the financial impact, Retailers have also undergone significant challenges in terms of operations, supply chain, fulfilment, and stock-outs.<\/p>\n\n\n\n

There are some positives: online retail, grocery, home improvement<\/b><\/h2>\n\n\n\n

On the flipside, online retail has been growing. UK digital revenue is up 17% across Q1<\/a>, outperforming even the 2019 peak shopping period in terms of orders, revenue, and unique shoppers, according to the Salesforce Shopping Index. As the virus spread, so did the move to online shopping, with the surge larger in the last two weeks of the quarter. Several retailers have also started releasing their annual reports showing the impact of the peak.<\/p>\n\n\n\n

Particular categories, unsurprisingly, like grocery, athleisure, home improvement and toys and games were showing particularly strong performance, and we expect to see that continuing as people adjust, things stabilise, and warmer weather in Q2 leads to more spending in outdoor. Leading grocers like Tesco and Sainsbury have seen growth in grocery and essential categories spike in March and April.<\/p>\n\n\n\n

In the short term, retailers need to continue stabilising and then focus on recovery<\/b><\/h2>\n\n\n\n

We can look to China for learnings since they are 6-8 weeks ahead of the UK in the crisis. Chinese retailers started preparing for store reopening even while their stores were being closed. They reset their thinking completely and changed their business plans.<\/p>\n\n\n\n

UK Retailers need to focus on a few things over the next few months, in order to stabilise and recover:<\/p>\n\n\n\n