How retailers can minimise the disruption of Covid-19 on trading
By Duncan Licence, VP Global Product, Metapack
For retailers, there have never been tougher climates to trade in – physical stores have been closed, consumer confidence is low, and people are spending less on non-essential items.
With millions of consumers in quarantine, their increasing dependence on delivery and logistics services is beginning to show. Retailers are having to make decisions to firstly, and most importantly, protect the health of their employees and consumers, and also to cope with the rising pressure on their infrastructure and delivery services.
According to Metapack data, non-essential retailer verticals that are experiencing the most request for deliveries include toy and sports brands, with some experiencing as much as a 297% year on-year increase in shipments processed. In order for retailers to maintain continuality and minimise disruption they need to ensure their supply chains are able to cope with everything and anything.
Below are three trends that they need to consider implementing to minimise disruption in today’s challenging new reality:
Supply chain agility
Over the past month, grocery sales have reached a record £10.8 billion. The demand on essential items has been extraordinary, and with no clear end to the crisis, it shows no signs of slowing down.
In order to meet this demand, retailers need to ensure they can access their inventory. Warehouse and supply chain agility is critical, as any break in the chain will impact a company’s ability to run its business and service customers.
For those with distribution centres in higher risk regions the ability to access stock may be severely hampered. Retailers need to be agile and have a delivery network in place to efficiently access, divert and shift their stock between regions so they can get items to consumers quickly and safely.
Reinvention of physical stores: ship from store
With over half of all physical stores now closed, retailers are having to rely solely on e-commerce sales to keep afloat. However, in order to protect employees and abide by social distancing guidelines, the risk of warehouse closures, is fast becoming a real concern.
How will get access to stock? In order to maintain business continuity and outlast the crisis, retailers should consider transforming their physical stores into mini-distribution centres to fulfil e-commerce orders.
By transforming physical stores into mini distribution centres, they can keep trading should their warehouses close, have the ability to sell ageing inventory, reduce delivery journeys by using local stock and safeguard the wellbeing of their employees.
Reliance on carriers (Metapack Covid-19 Carrier Index and Heat Map)
With more people using delivery services there is more pressure on carrier services, who are working tirelessly to get consumers their items. Retailers with critical dependencies on individual carriers are at greater risk of suffering from major disruption as they’re unable to spread the load across multiple carriers.
Retailers need to integrate to more than one carrier to ensure business continuity. What happens if that carrier is unable to fulfil the delivery request? Multiple carrier integrations provide retailers with additional layers of protection, and enable them to access remote inventory, deliver goods efficiently, navigate cross-border concerns and help safeguard their delivery services.
Currently, we can only speculate what the longer-term impact of Covid-19 on retail and delivery will be? Have consumer shopping habits changed forever? Will physical retail every recover?
Only time will tell. However, in the immediate future, retailers need to maintain their infrastructure, remain agile and ensure they are flexible enough to meet the changing needs and habits of their consumers, in a safe, efficient and effective manner.
