Retail is changing. And it’s changing at an accelerated rate because of COVID-19. It’s vital for anyone wanting to buy a retail franchise to familiarise themselves with the current, and future state of play.
Two reports suggest what’s important for retail post-COVID.
In a 2020 industry report Where next for retail and consumer? professional services network PwC sets the pre-COVID scene, citing key Australian retail industry figures from the Australian Bureau of Statistics 2019. Consumers spend about $300 billion (2019) and the retail sector contributes about $75 billion gross value added (GVA).
According to its own analysis, PwC estimates the sector accounts for about 15 to 17 per cent (2019) of Australian jobs.
But everything is changing through COVID. PwC’s report highlights three crucial areas that under lockdown faced intense pressure and revealed weaknesses and strengths in each system:
- physical stores
- digital infrastructures
- supply chains.
In an industry outlook video alongside retail webinar Retail 2021: Home, but not alone! global professional services and accounting firm KPMG points to the swift disruption to traditional stores.
“Rigor mortis store formats were already being challenged,” Paul Martin, global retail lead and UK head of retail, KPMG UK, said. “Consumers were already becoming digital natives and online commerce was growing, he points out. “In effect we are seeing five years of disruption within three months at the same time for everyone.”
Purchasing patterns – the what, how and where we buy – have changed from the beginning of 2020, with speed and safety a crucial element of a good shopping experience.
In the video Matt Darby, head of retail, KPMG Australia, comments “The consumer now shops in a parallel universe. A local village where we buy groceries and other products just down the street and a global village which is a deep online pool of the best in class retail experience.”
And those retailers who had invested in data and digital pre-COVID, were best placed to take advantage of the accelerated shift.
So, of course, strong digital strategy and implementation remain fundamental elements of forward-looking retail. There are other elements to identify in a retail franchise too.
The top five influences on retail are:
- digitisation
- safe physical environment
- product and pricing
- resilient supply chains
- organisation.
These five elements PWC believes will see retailers emerge stronger for future success.
This story first appeared on our sister publication Inside Franchise Business
