Many industries, barring a few like Pharma…, have been brutally hit by the Covid-19 pandemic. This pandemic has brought forth all the lacunae we had as a society.
We have enough and more experts pointing out why, where, how and who went wrong, but a very few have thought about what should be our way forward. And those who have, have not been able to break through the tip of the iceberg yet.
Here is my humble attempt to add value through the tools that will help us not only to break the tip of the iceberg but also the whole mountain, step by step.
It is common knowledge that the retail industry has taken a massive hit with this lockdown. Except for a few essentials, for which sales remained unaffected or in some cases – increased, many other retail products like Apparels, Cosmetics, Footwear etc., sales were forced to completely close or slow down.
Some days back there was an article published in Economic Times about the plight of small retailers post-COVID (like Kirana shops, smartphones shops etc.), and the article clearly stated the devastating effect this pandemic has had on these small-time retail shops and their owners. The article mentioned that over 6 lac Kirana outlets may have closed down during the lockdown due to liquidity crunch or return of owners to villages. The article also stated that even after the lifting of the lockdown on non-essential items like mobile & smartphones, 60% of these stores have not opened even after the sales were allowed.
These non-essential product business owners are now waiting in the wings to showcase a comeback. However, it will not be incorrect to say that the bigger brands, because of their available funds and a larger quantity of labour and of course latest technology, will still have it easy for them once they start their business outlets. They have their e-commerce, and discounts set up all ready to close the deal for them. The challenge will come for the local brands and retailers who were still trading in the same traditional ways.
What is typically considered as the traditional way of retailing?
- Real-estate heavy model – This typically happens when your modus operandi is in-shop sales only, you rely heavily on customers to come to your shop to purchase. You have overhead costs like rentals, electricity bill, water bill, maintenance charges etc., to pay for. The retail industry has now been aptly coined as ‘a six feet economy’ post- COVID, which explains that to keep running the retail outlets, shop owners will have to keep the strict regulation of 6 feet distance among customers, which will mean more space requirement by each customer, which will lead to more waiting period for a prospective customer, and with that lesser customer’s admissions in the shop on a daily basis
- Only cash dealings – This has been the norm with all small-time retailers as they live for the day and can’t get a rolling credit from their distributors and hence, can’t give any credit facilities to their customers in turn.
- People coming to the shop to do their purchases – When we are likely to have a work-from-home scenario in many industries (where work from home is a possibility), post- COVID it will become very difficult to rope in prospective customers to come to your shops
- Word-of-mouth advertisement –This has been the most effective tool for a small retailer. This will never lose its charm but will change from in-person communication to electronic communication method like WhatsApp, Telegram will become more prevalent
- Very less to no discounts – With lesser margin because of a real-estate heavy model and a high reliance for cash dealings, discounting is always a challenge
As I mentioned earlier, things have changed during this Covid-19 lockdown; majority of us have gone from an office going nation to a work-from-home nation. Hence that brings us to the topic of WHAT WILL BE THE WAY FORWARD FOR SMALL, LOCAL RETAILERs?
This is what I think will be the trend-forward post-COVID:
- E-commerce platform
- Electronic payments
- Shop going to people
- Digital marketing
- Can’t afford to survive without discounts
- WhatsApp, Telegram presence
- Good customer service
- Strong logistics network
This lockdown will force the traditional business owners to take a quantum leap for their businesses to survive the tidal waves of change post- COVID situation. Business owners will have to think out-of-the-box and quickly so now so that they have enough ideas ready before they set up shop again after the lockdown has been lifted.
Let’s kindle our mind to explore how we can solve the above challenge.
Q: Typically who do you think are the owners of small businesses?
A: Majority of them are from traditional business families
Q: What does the term Traditional means here?
A: Traditional = No, NOT OLD… but applying age-old methods to execute a sale
Don’t get me wrong when I say “traditional”, but the fact is that excluding a few unfortunate business owners, the majority of traditional business owners are people with a lot of profits under their belt. The only reason they are still working the way they work is that they DON’T LIKE CHANGE! And Covid-19 has done nothing else but brought about an enormous change in the way things will be done going forward.
Below is a list of things that have to be done to survive the aftermath of this pandemic, and the sooner they are done the faster businesses will get back on track:
- Take advantage of the gig economy – Off late, the market is flooded with people who work as freelancers. You have freelancers who are web designers, content writers, digital marketers etc., take their services wherever necessary to adopt technology
- Create a social media presence – Facebook has introduced the shop page, Instagram has a business page, Pinterest gives you the benefit to reach a variety of audience, take advantage of YouTube, TikTok also to reach out to your audience
- Communications now have different avatars – WhatsApp, Telegram… make your customer groups, send them offers, make it easy to buy, get them to resell your products or spread the word
- E-Payments – To receive and send payments has become extremely easy via the different modes like Paytm, G Pay, UPI, BHIM and soon there will be WhatsApp pay as well, take advantage of these modes of payments. You need to have a QR code that you can link to your business bank account and send & receive the payments hassle-free.
CHANGE! It is not only required, but it is now necessary for business owners to look at the NEW MODEL of retailing and embrace the #renewedsociety that we are progressing towards.
Image Courtesy: https://news.abs-cbn.com/
Economic Times: https://economictimes.indiatimes.com/industry/cons-products/fmcg/kiranas-in-crisis-disruption-tough-to-reverse-fears-fmcg/articleshow/76098644.cms