Retailing amidst crisis
On February 11, 2020, the World Health Organisation (WHO) announced the name for the new coronavirus disease – COVID-19. Since then, COVID-19 has become the most used term in our daily life and, by far, proved to be one of the worst health crises of recent times.
According to the Worldometer website1, as of April 5, 2020 morning, there are 1,203,188 coronavirus cases, of which 246,760 have recovered, while there were 64,747 deaths. What started in China’s Wuhan province, spread like wildfire engulfing countries, individuals and businesses. Among countries, the US, Italy and Spain are the worst affected ranking above China now. In the GCC, Saudi Arabia is dealing with a maximum number of COVID-19 cases, followed by Qatar and the UAE.
As medical systems and economies are buckling under pressure, the International Monetary Fund (IMF) has outlined some “wartime policy measures.” These include the absolute necessity of functioning of essential sectors such as healthcare and food production; guaranteeing enough resources to people impacted by the crisis; and preventing total economic disruption.
To tackle the on-going crisis and ‘flatten the curve’, many countries around the world have implemented complete or partial lockdown, while encouraging social distancing.
Currently, the impact on most businesses around the world is severe. Several global companies are undertaking austerity measures, so we can only imagine the plight of small and medium-sized enterprises (SMEs).
However, to curb irreparable damage to economies, businesses and individuals, countries – globally – are announcing stimulus packages. Case in point: the US has announced $2 trillion stimuli; India has pledged $22.6 billion to assist poorer communities affected by the coronavirus lockdown. Meanwhile, the UK Government has announced financial support towards “retained employees who cannot work with an 80% subsidy up to £2,500 a month.”
Within the GCC, the Kingdom of Saudi Arabia (KSA) has pledged SAR120 billion to overcome economic impact as a result of the COVID-19 outbreak.
The UAE Central Bank has approved an approximate $70 billion stimulus package to support the economy. The emirates have announced several support measures – such as rent and fee relief, payment deferment; waiving of fines, to name a few. Several public and private organisations in the UAE have joined the fray.
Moving over to the impact of COVID-19 on retail businesses, suffice to say that the sector is seeing a
‘new normal’.
During a crisis, no one is a winner! However, some segments within retail – such as e-commerce, food and grocery – hypermarkets/supermarkets; pharmacies and consumer electronics – are seeing a spike. While shopping malls, food service, traditional entertainment as well as fashion are among the worst hit.
The crisis has already driven home a few critical messages. There is a need for ‘real’ digital transformation because omnichannel isn’t an option anymore and leveraging technology isn’t a choice. There is a clear need to protect and upskill people to quickly redeploy them in new roles. Importantly, standing together is one of the most potent ways to face and overcome the on-going crisis. It is the time to stand out by being pragmatic, empathetic and safe.