Predictably, 2019 was a year in transition. There was stability in the positioning of the top five retailers and a few notable bankruptcies in different retail stores like Nakumatt Supermarkets and Ukwala Supermarkets. The emphasis on understanding what consumers really want continued to expand the gap between the leaders and everyone else who followed. For retailers, understanding how consumer expectations are evolving has never been more important, especially with the convergence of supply chain, digital technologies, and other innovations.
Come 2020, the covid19 shook the retail industry, many businesses and companies were closed, some went bankruptcy. According to the survey done by RETRAK majority of retailers are optimistic of the future growth in the industry as there are still pockets of growth, with a number of retailers looking to open additional stores and business units like Supermarkets, Mini markets, Restaurants, Pharmacies as well as venture into eCommerce to complement existing brick and motor stores.
With consumers buying patterns to online shopping, retailers have to rethink how to meet the demand for online buying. According to the survey, majority of retail businesses are implementing an eCommerce platform to reach consumers. However, the retail businesses find growth in the sector to have slowed down due to consumers selective spending and economic uncertainties.
Speaking at the launch of Retail Industry Survey, Mr. Sailesh Savani the CEO and founder of CompuLynx said that “Adoption of eCommerce to complement brick and mortar stores could be the difference between surviving and going under. He added that, with such tough retail environment and the internet will be a source of growth and retailers should leverage eCommerce, delivery units as well as big data to understand consumers better and generate more insights to improve business effectiveness and conversion rates, then adjust supply chain accordingly. IT providers such as CompuLynx offers such solutions”
In a 2020 retail industry survey conducted by CompuLynx in partnership with RETRAK, the projected average growth of business units in the next two years in retail sector is 20.78%. Retailers who were surveyed will be introducing cooked food and bakery which will grow fastest in the next two years both recording 38.46% and 25% respectively. High consumer demand for home consumption in the new normal due to covid19 restrictions on movement and social activities will lead retailers to expand their business activities to wines and spirit 16.67%, fruits and vegetables 16.38%.
Despite the poor economic conditions, and the covid19 pandemic, retailers have opted to open new stores to avoid industry shake-out. The expansion finds itself in a number of categories like saloons, Chemists, wines and spirits, grocery chains stores, and mini supermarkets.
“The retail business is grappling with Human Resource staff retention and turnover due to an undefined career path in retail sector, and to corporate governance due to weak governance structures especially in family owned business. This makes it difficult to attract funding or get credit and when time becomes tough it can lead to collapse of businesses, hence the challenge of financial capacity in the sector.” Says Wambui Mbarire, Chief Executive Officer (CEO) RETRAK.
In conclusion, Covid19 has presented the greatest challenges globally but most retailers are optimistic of the future as combined, the majority foresee constant growth with promising potential.
By Carolyne Rabut
Content Marketing – CompuLynx