Q4 Demands – Are You Ready?
There’s no doubt that 2020 has been a year of adapting and evolving due to the pandemic and the new ways of working, living and shopping everyone has had to adjust to.
In June 2020, analysts at Edge Retail Insights had noticed such a change that they amended their 2020 forecasts to accommodate the surge in online shopping, adding an additional £2bn to their original prediction on £29.1bn in UK sales before the pandemic. Specifically they adjusted their forecasts for ecommerce from 11% to 19%, for grocery shops from -0.8% to 3.3% and pharmacies and health retailers from -4.6% to 4.0% which can be seen as positive when so many other sectors have been predicted a decline. For example, the same report has changed the forecast of UK sales in beauty specialists down from 3.6% to 1.4% and department stores, a staggering -1.1% to -17.8%.
Another interesting change has been highlighted by property firm CBRE who state that they have seen a rise of 33% in new deals for warehouse square footage coming just from online retailers. In Q2 of 2020 CBRE reported that warehouse rental space had doubled compared to the same time in 2019 and by Q3 they continued with a record 13.3m sq. ft.
This is important for supply chains and logistics firms, plus those of us who recruit for them, as the increase in demand for online retailers exacerbates their needs for space and personnel. With this parallel growth, we are looking ahead to a very busy peak season in warehouses across the county. Black Friday and Christmas are always demanding however when traditionally high street shops would be recruiting temps for their stores, now they are closing and seeing footfall decrease, in August footfall for non-food stores was down by 34.8% nationally. With the three-tier lockdown system in place, localised areas will no doubt see footfall decrease further and those are tragic, but important gains for retailers who have established ecommerce trading in place.
However, this could spell disaster for any business not equipped for the increase in demand. Comparing Ocado and Tesco’s response to the surge in online grocery shopping at the beginning of lockdown is a really interesting example. Ocado use automation to pack the products for their online-only supermarket so when a rapid scale-up was needed, they couldn’t deliver. Tesco, on the other hand, became “the first retailer in UK history” to deliver over one million orders in a week after hiring 16,000 new staff.
Not every retailer has the capacity to increase their workforce so dramatically though (there are only so many people you can safely fit in a warehouse after all), which is where creative and innovative solutions are needed, from specialists who don’t just recruit people but know your business and can plan, execute and deliver the whole package; even put projects into place to monitor KPIs, reward, and therefore improve, efficiencies. Partners in your business who will help you adapt and thrive this festive season (and beyond into January sales and returns), keep your business capable of meeting new demands and continue to deliver the service and products your customers expect.