Our predictions for how COVID-19 will change the retail industry

This year has seen significant change across global markets with retail being one of the most deeply affected. From coping with the uncertainties that the pandemic created to adapting to changing consumer behaviour, there are many ways in which COVID-19 has been the trigger for change. These are our predictions for how this change is likely to pan out in the coming months and years.

The e-commerce boost – While e-commerce was already very much a feature of retail before the pandemic it has now become an essential resource for many consumers. This is particularly so when it comes to grocery retail – being able to get hold of food and household goods without shopping in-store is going to remain essential.
A new approach to supply chains – Prior to the pandemic, China was the world’s largest exporter and the source of a third of manufacturing worldwide. When Chinese factories and industries shut down many international retailers were left in a difficult position. This has resulted in a shift in the approach to the supply chain with many countries looking to establish more local options and remove reliance on China.
Contactless payments become the norm – According to one survey earlier this year 22% of connected customers globally were already using digital wallets for payments. This was a pre-pandemic figure and is now likely to be much higher. Some card providers have increased their contactless limits to facilitate the need for more – and greater – payments to be made this way. It’s likely that the need for social distancing will continue to keep contactless retail at the top of the agenda for some time to come.
Reshaping the retail landscape – One very obvious trend that has resulted from COVID-19 is the rise of big-name retailers. Amazon, for example, had to hire hundreds of thousands of new staff during the pandemic as spending shot up by 35%. This has made these huge brands even more dominant which – combined with smaller retailer closures – could create a very different retail landscape in the years to come.
A greater choice in last-mile delivery options – Thanks to the ongoing increase in online shopping there will be more pressure than ever before on retailers to offer a wider range of last-mile delivery options. This will not only mean that retailers have to factor in the impact of customers no longer browsing in stores but also balancing costs of delivery that could significantly reduce margins.
Tech-driven changes – Technology was a real lifeline during the pandemic, making it possible for retailers to continue to reach customers and find new ways to keep income streams open. It is likely to continue to be a crucial component in survival and also offers an opportunity to enable a business to thrive. Already we are seeing the use of robots – autonomous vehicles being used to make deliveries – and augmented reality has provided a simple way for consumers to browse products or properties that they can’t actually get to as a result of the current conditions.

COVID-19 has already forced retailers to reconsider supply chains, integrate more technology, and make digital shopping and efficient delivery a priority. If you are looking to update your retail space to allow it to become more functional during this current climate, then please do not hesitate to contact one of our specialists here at Cumberland Group.

Our predictions for how COVID-19 will change the retail industry

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