Covid-19 News

“What if there is no tomorrow? There wasn’t one today!”- Phil Connors, WPBH-TV Pittsburgh

Has the Christmas classic “Groundhog Day” just got real for retailers facing a second lockdown?

In the film Groundhog Day a hapless weather forecaster, Phil Connors, finds himself reliving the same day over and over again in a small town in Western Pennsylvania named Punxsutawney.

Ultimately Connors, played by actor Bill Murray, after initially being driven to despair over the repetition resolves to use his knowledge of what happens in the town on that day to create the best possible version of it, for both himself and others.

So the question is, will retailers contemplating the second lockdown approach it in the same way as before, or learning from the previous iteration will they make the second experience a better version of the first for all stakeholders?

For many the challenges will seem familiar. However, this lockdown is not as extensive as the previous one with non-essential retail remaining open for delivery to customers and click-and-collect.

Last time it emerged that an unexpectedly high number of stores were no longer feasible under a lockdown regime. However, this time around risk departments will have learned from previous experiences and more readily identify those stores that are not feasible. And restrictions under the second lockdown may not be as debilitating for some stores, especially where the property can potentially operate click and collect or customer delivery, or go dark to meet regional demand driven through online sales.

Inevitably some sites simply will not be able to operate under the new rules. However, if you are in a situation where closing premises is the only option, think long and hard about what the lasting image of your brand will be on the high street. Boarded up stores with paper hanging from windows and mountains of debris and graffiti are not going to make a good impression on shoppers. You could simply be storing up trouble for when you re-open in four weeks’ time.

Where stores are remaining open, it is vital that you continue to provide shoppers with a Covid secure customer journey. Of course, retailers have been operating these environments for some months. However, some stores can expect to suddenly experience huge demand if panic buying sets in and that, coupled with seasonal demand could put extra strain on queuing systems, social distancing measures and click and collect infrastructure.

Returns space will be a huge issue. Online is expected to go crazy owing to a combination of physical shopping restrictions that push shoppers online plus seasonal sales and demand. It is fair to say that a month’s worth of returns added to the seasonal demand of shoppers, when finally they can go out and shop, is going to create significant problems in terms of sheer numbers of people and quantity of goods. Not only do customers need a Covid safe journey, but all of those returns need to be quarantined then inspected and returned to stock with customers suitably credited. This is going to be a major challenge as we emerge from lockdown.

There will also be an increased opportunity for fraud associated with online as a result of increased volumes of transactions. For example, customers calling to claim items were missing from shipments. We have new technology that uses the receipt to instantly check back to the pick note, a video of the order being picked and sealed and despatch. This kind of innovative technology is going to be hugely important in mitigating risk of criminal loss in the future.

When lockdown was first introduced it was at a point where retailers were expecting Summer stock and were moving the last of their Spring stock to make way for it. This time we have the dual pressures of Winter stock and the Festive Season. Chances are that retailers have more stock in their warehouses right now than at any other point on the calendar. And that means the potential for stock loss is greater than at any time, either through theft, damage or administrative error.

So please make sure that your systems are in place for monitoring closed premises rammed to the rafters with stock. Do you have three local keyholders and do they actually have keys and codes. Are they contactable and have you checked with your third party security provider that the alarms are linking to the relevant monitoring stations/emergency services as you think they are and as they should be. Last time we were plagued by alarm situations with no keyholder available.

Lockdown is not all about challenges and threats. It is about opportunities too. Those retailers that have historically enjoyed significant market share through excellent instore retailing do not necessarily have the ability to provide the same experience online. And even if they do, can their systems cope with increased demand and still afford their customers the consumer experience they expect? Lockdown could again be a great opportunity for some retailers to steal a march on competitors better used to offline channels.

And finally I would add a further word of caution to retailers about the New Year. January could be dark. We have the dual impact of Brexit and an anticipated recession to factor in. Seasonal work will reduce. People will lose their jobs and have seasonal debt to repay. Consumer confidence may well be low and crime rates rise as people become desperate. Make sure that you take these factors into account when deciding your risk management strategy for the beginning of 2021.

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