Retail trade during the coronavirus crisis
Perishable goods. For companies selling perishable products such as dairy products, meat and fish, cheese, fruits, vegetables and others, the inventory process is extremely important. Expired items must be removed from the shelves, and discounts may be provided for items near the expiration date.Early autumn 2020: the coronavirus epidemic in Ukraine is gaining momentum. The autumn-winter period is the traditional peak of the spread of respiratory diseases. Therefore, it is logical to expect a significant increase in the number of COVID-19 cases and the introduction of new quarantine measures.
How will this all affect retail? Based on the experience of the epidemic in Europe and the USA, the main factor that will influence consumer behavior is the fear of infection in a public place. People will want to spend significantly less time in grocery stores, which reduces the time it takes to make a purchase decision.
In this article, we want to highlight the main conclusions that retailers and suppliers made during the first wave of coronavirus in Europe and the United States.
When the restrictions began to be canceled, many consumers in Europe returned to stores, and some people happily began to line up before being allowed inside. Shopping has become one of the few socialization options available, as there are still restrictions related to overseas vacations, cultural activities, and the fact that most people still work from home.
Even as restrictions are being eased and businesses are reopening in many countries, according to Kantar's study, 66% of people globally say they will continue to avoid high traffic areas, making physical commerce difficult.
Now is not the time to apply standard rules to assortment planning. COVID-19 has revolutionized consumer needs. Therefore, it is necessary to rethink the merchandising plans that may have been before the pandemic. The first thing to do is look at the data and analytics. For example, if you've sold online before, look at the categories or products that generate the most traffic, sales, and profits, and then use that data to form your assortment of goods in the store.
Make “hot” products more accessible. Once you understand which product is generating the key profit, allocate appropriate shelf space for that segment. During the COVID-19 era, this means you will have more space for your high-demand items than for displaying multiple product lines on the shelf. This goes beyond the traditional foundations of retail merchandising, placing more expensive products at eye level and taking advantage of opportunities to diversify and showcase multiple products. Now it is necessary to allocate the largest area on the shelf specifically to goods with high demand, so that buyers can quickly find and put in the basket the goods they need, minimizing the time spent in a public place because of the health safety.
Instant offers and discounts. It's important to rethink and update your sales strategy. Concepts such as discount coupons for future purchases will not be as effective as it used to be. It is important to increase customer loyalty, for example, through immediate or short-term discounts, since many shopper decisions will be determined by the “here and now” criterion.
This is a misconception that with store openings the consumer will buy more than ever. Shopping habits have changed and we are in an economic crisis. In this regard, permanent inventory is more important now than ever before, there are several reasons for this:
- Delay in the sale of certain categories of goods. Faced with stockpiling due to insufficient consumption, retailers and product manufacturers must use data analytics to identify delays in sales in a timely manner. Based on the data obtained, marketers can develop flexible and individual solutions taking into account the characteristics of various categories of goods.
- Perishable goods. For companies selling perishable products such as dairy products, meat and fish, cheese, fruits, vegetables and others, the inventory process is extremely important. Expired items must be removed from the shelves, and discounts may be provided for items near the expiration date.
- Timely replenishment of top-selling items. During the outbreak, some scarce goods such as disinfectants, semi-finished products, and toilet paper were snapped up before they could be restocked. Management must create a timely and effective feedback mechanism in which all departments, including sales, logistics and purchasing, can interact.
At the time of the coronavirus phenomenon, the importance of assessing and monitoring realograms, its comparison with the planogram, has grown exponentially. This is due to the fact that the time spent by the buyer at the point of sale is now falling significantly, so empty facings should be minimized as much as possible and their liquidation should take place promptly.
Due to the fact that stabilization and alignment of the market is still unlikely, at least until the end of the epidemic, we should expect constant fluctuations in supply and demand. Picsell can provide retailers with an efficient way to automate the shelf monitoring process for:
- obtaining timely real-time data in order to make effective decisions regarding the supply of goods to retail chains;
- improving the quality of customer service due to the fulfilling of the shelves;
- monitoring demand for specific categories of goods, the ability to quickly respond to changes in it;
- reducing the time the merchandiser stays in front of the shelf, which, in turn, frees up space for the flow of customers.