A new Fashion concept store in China
Crystal Balls….the next panic buy .Toilet rolls, Pasta then Crystal Balls. Our fellow Europeans must be somewhat perplexed when reading that the first food us Brits, who elected to leave the EU , decided to stuff our cupboards with, was pasta. What’s that all about? What happened to Chicken Tikka Masala, Roast Beef and fish and chips. Since when have we become a nation that relies upon pasta to keep us going ?
None of us knows what retail will look like PC(post covid). However, there are some certainties (as much as there ever can be ) in some of the changes that are inevitable
Why talk about this type of retailer? Unfortunately these have been on the decline for at least three years. Because for a long time they have been the cornestones of major shopping and town centres. Both Debenhams and the House of Fraser are financially on the brink. The latter is , of course, part of the Sports Direct Empire, but I can’t see them hanging onto them for long unless there are some major changes. John Lewis has already announced they will close some stores. None of this is news nor is it constrained to the UK (Nieman Marcus the oldest department store group in the USA has just filed Chapter 11). They are losing their USP, and they are also loosing many of the concesssion brands they all use to fill the stores. Warehouse and Oasis, Cath Kidson and Laura Ashley in the UK , J.Crew in the US (inc 500 stores), to name but a few, are the latest.
Major Shopping Centres
The likes of Westfield, Hammerson,Intu and others are facing the perfect storm (always find that slightly contradictory, perfect for who?). Huge downward pressure on rents, multiple retail failures, and now the complete closure due toCovid. It is likely they will not be allowed to open for some time owing to the large number of visitors they attract, and going forward I can see many consumers avoiding them quite literally like the plague. To survive in the long term, they really need to find their Mojo. They will have to reinvent or die.
Independant High Street Retailer
During the crisis, unfortunately the shopping that has occured has been online (apart from food,where independents in the main have done well) . Consequently more consumers have got used to going online. However, the consumer has missed going to a ‘shop’. But that feeling wont last long. For those retailers that went into lockdown in a reasonably healthy position there will be the opportunity to regrow and take advantage of the weaknesses left by failing multiples . But that will need innovation, creativity and the development of their own web presence. Those retailers that were struggling , will continue to struggle if they survive at all. Even within my own industry (party) there have been casualties who have closed down already. There will, undoubtedly, be more.
I know that a number of online operations who have been active from the beginning have had a great time. Stretched and stressed because they were working with a much reduced work force but successful nevertheless. For right or wrong , depending where you sit, their futures, especially in the short to medium term, look bright. They have been ably served by Amazon, in that Amazon were focusing on the essentials market for the first few weeks, and were for a time longer there as a competitor. On the other side of the coin , those Amazon resellers that only sold on Amazon, were scuppered. Ebay, on the other hand , I suspect, enjoyed a resurgence, that may or may not continue depending upon the consumer’s experience.
The biggest unkown in all this. How will they behave ? Whilst a lot of High Street retailers will wish their shop manners will improve, they maybe whistling in the wind. As to how they will spend their disposable income, is a far more serious question and a really difficult condundrum. Those still in a job, will probably have temporary additional spending power as it is likely they have been spending little whilst locked away. There is a strong possibility that they may rethink about how they spend their money. I have not bought this for some time, I have not missed it, do I need it? The response will probably be one of the most important factors for the Retailer in modern consumer behavioural activity. Those who will have lost their jobs will not be spending.
The only defintive is that there will be change. And it will be pretty major. What that change will be take some time even when ‘normality’ is resumed. The only action that can be taken in the immediate future , is looking at one’s own operation, look at the changes you think it needs, then be very aware of what is happening around you and adapt to meet those changes. So very easy to say……Just dont think that things will go back to normal.