The Retailers Association of India (RAI) hosted a webinar titled ‘Retail Business Roadmap: From Survival to Revival’ as a part of its ongoing ‘Coping with COVID-19’ series.
The panel comprised top retail executives including Ajay Kapoor, President-Retail, FAB India; Amit Kumar Sirrohi, Head – Retail Business, Raymond; Bhupesh Dinger, Director, Enrich; Sumit Dhingra, Managing Director- India, Sri Lanka & Nepal, Crocs; and Sumit Ghosh, Director, Fossil India. The panel was moderated by P Viswanath, Executive Director, KPMG India.To track all live updates from the coronavirus pandemic, click here…
The webinar touched on various aspects of the business like inventory management, cash reserves, shareholder outlook, adoption of technology and more, in the light of surviving the current crises and reviving from it.
Drawing focus to the safety aspect in a post-COVID retail ecosystem, panellist, Sumit Ghosh, Director, Fossil India, said, “The most important thing for malls and stores to do is to create an environment of safety and win over the first few customers that come back. Then word-of-mouth will spread. More and more shoppers will become comfortable and the business will revive.”
Sirrohi from Raymond is of the view that retailers need to revise their plans based on the changed consumer behaviour. “This is the first time in our lives where all of us, our families, have been confined to the four walls of our houses, this changes a person, the person’s outlook towards life, we’ve reprioritised. And this is going to reflect in our shopping behaviour too,” he added.
Speaking about the key theme of these times—change—Bhupesh Dinger, Director, Enrich said, “It is important to think about what will not change. From a consumer point of view the need for looking and feeling good, the need for social interaction, focus on health and wellness. From a company point of view, your reputation, the trust and processes you’ve developed, the customer base you’ve built over a time, your vendor support, the great people that are in your system. These things will not change, so take these strengths and address the things that are going to change.”
“The world is not going to be the same one we are used to. The coming times are going to be about unlearning what we have learnt and learning the new dynamics that we are supposed to get used to,” stated Ajay Kapoor, President-Retail, FAB India.
- When the economy opens up, the initial shoppers will be millennials going for revenge buying, discount seekers and bargain hunters.
- The reason for going to a mall is going to change significantly. And so are the reasons to shop.
- Consumers are increasingly adopting ecommerce and this change will have certain lasting effects.
Effects on businesses
- Although all businesses are in the same storm, they are not in the same boat. Every retail business is in a different boat as each business has a different cost structure, inventory position, need for cash and so on.
- Margins will get diluted as discounts will be used to ignite demand.
- Shareholders and organisations will now start looking at cash reserves differently.
- Long-term contracts will become a rarity for some time.
- Promotions will be very critical in the recovery story.
- Newer business models will emerge.
- End of season sale will be about liquidating excess inventory and not pursuing excess sales.
- Revenue share models will become commonalities.
- Shopping by appointment might become the new norm.
- Preference will shift to standalone stores.
- Health and safety are going to be the primary differentiators.
- Brands with strong credibility and a loyal customer base will be the first ones to bounceback.
- The crisis has taught businesses to look at cash reserves differently.
Guidelines for retailers
- Cash should be the priority for businesses.
- Create both short-term and long-term plans.
- Create simple and easy to follow SOPs.
- Retailers and mall owners will need to look at each other’s cost structures and come to common consensus for survival.
- Inventory efficiency and optimisation are of utmost importance.
- Demand-led models need to be adopted.
- Businesses must adopt an Omni-channel strategy to remain relevant.
- Organisations should look at risk-modelling for extreme scenarios such as no supply from vendors for two months.- Create better experiences for whatever limited consumers you do get in your stores.