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As lockdown 2.0 struck on 5th November in England, the retail industry was once again left with a lingering feeling of uncertainty.
Retailers adapted to the new normal, got ahead of major panic buying, and made sacrifices to help with the reduction of coronavirus cases, with many non-essential shops having to close their doors once again.
Some are still worried about panic buying, having seen the effects that hysteria caused back in March. But will we see the same thing again over the next few weeks? SalesOut, a wholesale data analysis company, predicts that there will be some panic buying, but not to the same extent that we saw in the initial weeks of the first lockdown earlier this year.
Kirsty Harris-Clarke, managing director of SalesOut, said: “Although there will be panic buying in certain areas of the country for items in particular categories, as consumers now know what to expect and this has become the ‘new normal’, this will be significantly less and more manageable than in March.”
SalesOut, amongst others, also said that retailers are expecting Christmas shopping to be brought forward earlier because of lockdown, meaning that sales could spike slightly.
The British Retail Consortium launched a national advertising campaign, ‘Shop early, start wrapping, enjoy Christmas’, urging people to spread demand and avoid putting last-minute pressure on retailers’ delivery networks.
This is supported by SalesOut figures that showed turkey sales were up 150% in the first lockdown week (until 6th November) in comparison to the week previous. SalesOut says that people may be wary about leaving it too late to purchase in the period between lockdown ending and Christmas Day.
Kantar has released data showing that the latest grocery market share figures reveal that take-home sales rose by 9.3% during the 12 weeks to 1st November 2020. Kantar says that in Britain as a whole, a record of 5.9 million people purchased groceries online in the month of October.
The CEO of British Independent Retailers Association, Andrew Goodacre, said: “We can expect to see more customers go online, and already Tesco are having trouble meeting the demand for online orders at Christmas.
“We will also see customers focus on those shops that are allowed to open, many of whom sell some food (but not a significant amount) as they start to think about buying certain ‘essentials’ in advance of the festive period.”
SalesOut provided figures in some areas that have been impacted by the second lockdown. A few of the categories that saw notable sales growth in the first week of lockdown (until November 6th) versus the week previous (until October 30th) in retail were: biscuit assortments (+355%), chocolate boxes (+80%), pickled and preserved fruit (+78%), shortbread (+63%) and lemon curd (+37%).
SalesOut predicts that outside of turkey sales, retailers can expect to see sales growth in chilled products as we approach the end of lockdown, and a clarification that will hopefully come from the government with regards to consumers’ Christmas Day plans.
Non-chilled products have also been performing well as consumers are stocking up early or thinking about ideal food gifting.
However, the company says that those fine food retailers that are involved in the foodservice hospitality sector with cafés or restaurants won’t see much positivity in the coming weeks. The BRC believes that this second lockdown will have a staggering adverse effect on the non-essential retailers, costing the sector around £2 billion a week. Although, this time around non-essential retailers are able to conduct a click-and-collect service, potentially enabling many to operate their store as distribution hubs or ‘dark stores,’ which will present an opportunity for some.
But it is not all doom and gloom. The FSB noted in their New Horizons report, that acts of kindness from small businesses are perhaps the most common stories emerging from all parts of the country. For example, 30% of all small business owners prioritised and supported vulnerable customers, with 19% offering free home deliveries, and 57% of small firms were carrying out community roles during the crisis.
Having an effective online presence is now essential for retailers to be able to respond quickly to changes in demand and adapt their digital outlets to cope with unplanned circumstances, and the FSB also found that 16% of small businesses developed a new online presence or increased their current digital presence, including delivering their offering online, during the coronavirus lockdown. For those businesses that expected to remain open, that figure rose to 21%.
It’s fair to assume that Christmas isn’t cancelled, but retailers will have to adapt to these new shifting trends, particularly building their online presence, in order to make a success of the festive season.
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