Retail has been hit hard by the pandemic and the on-going economic turmoil. The industry has had to adapt to new ways of working to survive, including exploring the new technology available. Rob Shaw, SVP Global Sales at Fluent Commerce, delves into current trends impacting the industry and what’s next for retail.
It’s been far from plain sailing for the retail industry over the last couple of years. A global pandemic coupled with on-going economic instability has seen many longstanding retailers shut up shop for good. Some high streets have become ghost towns with nothing replacing the empty lots where the likes of Debenhams, Laura Ashley and Topshop used to stand. On the other hand, luxury brands, value-based companies and DIY stores are booming. Coupled with the unprecedented rise in e-commerce, new jobs and opportunities have arisen across these categories.
The way people like to shop has invariably changed with today’s consumers expecting more convenience and reliability, next day delivery and environmentally friendly options. Those retailers that have successfully adapted their offerings have been able to reap the rewards. But how can they bring this forward in 2023?
- Recruitment and tech talent
Recruitment trends such as The Great Resignation have impacted businesses across industries, with retail being no exception. In the early stages of the pandemic, it was hard to find people who wanted to move jobs because they valued security over new opportunities. As the world stabilised, this turned on its head. Salary demands went up and people looked elsewhere as they saw green shoots of recovery, while businesses wanted to hire quickly to expedite this growth. Fast forward to today and there is a reset happening. As economic instability has taken its toll, major retailers from department stores to direct-to-consumer brands have cut staff. It will be a difficult few months but the market will start to rebound and unemployment levels will rebalance. Those companies looking for sustainable ways to manage staff levels will flip the other way.
As evolving technologies transform the industry, new opportunities will be created. According to recruiter, Robert Walters, the emergence of technology in all its forms – from apps and online to VR, financial and deliveries – has given Britain’s largest single industry a well-needed facelift, with tech roles now representing a quarter (24%) of all new job vacancies in the sector. Retail is now one of the biggest UK recruiters for tech talent due to increased prevalence of automation, Augmented and Virtual Reality and buy now pay later schemes in the industry, and this will continue to drive new hires over the next 12 months. Technology professionals are enabling the industry to meet the expectations of today’s digitally savvy consumers.
However, as IT skills gaps threaten to hinder retailers’ Digital Transformation plans, HR teams must step things up to attract and retain crucial tech talent. Building a strong company culture with good benefits is paramount. Teams should prioritise flexibility, a strong diversity, equity and inclusion (DEI) strategy and training opportunities to ensure the workforce is adaptable to change, flexible and has the right skills to cover gaps as they arise. Post-pandemic, success for future employees looks different than it did before with salary only forming a small part of what they are looking for.
- Fulfilment focus
The economic recession has been a burden on many businesses over the last few months with a slow start to 2023 for many. Staffing and cost of retailing itself has been heavily affected by inflation – with cost of goods and supply both increasing. As a result, many retailers are now taking a more cautious approach to fulfilment. Typically, retailers have looked into the future and bought large numbers of stock in advance, predicting what demands are going to look like 12 months out.
However, this approach has left many retailers with an excess of stock they are struggling to sell, causing ‘inventory bloat’. Retailers are under a huge amount of pressure to clear stock, release capital and reduce spend on warehouse storage. As a result, increasingly across the industry, procurement teams are being more frugal about how far in advance they’re buying stock. They are creating scarcity of product so things will sell out rather than go to sale.
Only retailers who have an accurate view of where and how much stock they have in each location are in a position where they’re able to sell it. And, more crucially, ensure they’re not overselling, leaving customers disappointed. With regular stock checks, up-to-date sale channels, improved planning and a modern OMS, retailers can have a real-time view of inventory which helps them sell stock in the most efficient way. This will help retailers respond and adapt much faster to their customers buying behaviour in the future – readily prepared for another exercise or home improvements frenzy.
In a difficult economic climate, many retailers are struggling to balance sustainability with business needs. However, while the cost of living crisis is influencing spending habits, the environment remains important to UK consumers with 65% still prioritising sustainability when shopping. There’s a drive from today’s consumers to be more environmentally friendly. There is a number of steps that retailers can take to spur this into action. Supermarkets have led the way with initiatives like bags for life which are easy to roll out and quick to become behavioural. Businesses must find a way to provide convenient and fast shopping experiences while keeping costs low – and achieve that in a sustainable way.
Technology offers some of the obvious solutions. Investing in the latest order management software for example allows retailers to ensure they have an accurate forecast of demand and can buy or manufacture the correct amount of stock to avoid waste. It will also enable them to ensure the delivery process is as efficient as possible. For example, it can make it easy to group products together to avoid multiple trips or to ensure that products are sent from the closest distribution centre to reduce miles in transit. Technology also enables retailers to offer multiple delivery options, such as click and collect, that can save a home delivery altogether.
Offering sustainable shopping and delivery options can make a huge difference to the reputation of a brand, while having a minimal impact on business processes. This will result in huge financial gains in the current economic climate, where brands must find a way to differentiate themselves.Click below to share this article