Coronavirus outbreak accelerates retail technology revolution

15% of UK retailers have created roles specifically to cater to an increase in digital sales and boost online capacity, according to research from Barclays Corporate Banking.

Over 300 senior retail executives were surveyed for this. Confidence is high, with home improvement/DIY firms most upbeat about growth, followed by health and beauty retailers.

And many retailers are looking to localise supply chains and increase support for communities. 39% experienced supply chain disruption during lockdown, and 27% are looking to move to suppliers based closer by as a result, with the number rising to 38% for larger, 500+ employee businesses

26% believe the pandemic has accelerated a technological revolution in retail due to a shift to online shopping. 32% said they have also started to accept a broader range of payment methods to maximise income.

It's entertainment retailers (38%) that are most likely to have made changes in this area. Upgrades here could include everything from accepting mobile wallets – such as Apple Pay and Google Pay – for the first time, to accommodating new consumer finance options and rolling out biometric payment technology.

26% have embraced data analytics technology for the first time since the coronavirus outbreak began. Electronics retailers (39%) lead the way in taking this step. More generally, 29% have invested in new technology to accommodate more sales through digital channels, with smaller retailers (40%) – those with between 10 and 49 team members – most likely to have done so.

Other developments include: 26% of businesses selling more through social media channels, with fashion retailers (37%) in first place for this development; 26% rolling out more personalised customer offers, with home improvement/DIY retailers (33%) most likely to have implemented this change.

24% are offering Click and Collect for the first time; again, it’s home improvement/DIY retailers (40%) that are in top spot for making this adjustment.

With homeworking set to continue for many people – in parallel with concern about public transport and busy shopping areas – the research shows a move towards more localised business operations.

For example, one in seven retail businesses plan to reduce the number of physical stores they have in urban areas close to office buildings within the next year. Health and beauty retailers (28%), supermarkets (19%) and food and drink retailers (18%) are most likely to do so in the next 12 months.

We could also see the number of urban outlets fall further in the longer term, with one in five of respondents telling Barclays Corporate Banking they see the future of the physical retail industry on local high streets rather than in city centres.

"I don’t remember a time in retail quite like this. I’m not sure anyone does. It was inconceivable at the start of the year that nearly every high street store would close for three months, but it happened," says Karen Johnson, Head of Retail and Wholesale, Barclays Corporate Banking.

"And as retailers adjust to a post-lockdown period, one in which many people are still concerned about contracting Covid-19 and have less disposable income, there is a general acceptance that the landscape has changed inexorably. Businesses are past the preservation phase and are now thinking about longer-term trends and how they can compete in the new normal."