Retail and restaurant companies must take an aggressive, multifaceted approach to health and safety.
That’s one of the recommendations of a new report by Cambridge Retail Advisors, “Adapting to the New Normal,” which said that C-level leadership — specifically a chief health officer — is needed to establish a vision for chainwide public health and ensure store-level initiatives are executed timely and effectively.
The report, “Adapting to the New Normal,” also said that retailers and restaurant operators need to prepare for longer store closures and potential future closures and develop action plans for rapid reopening when local restrictions are lifted.
The report fielded an online survey to mostly C-level executives at retail, grocery and restaurant organizations to identify how they were dealing with the key challenges related to the impact of the COVID-19 pandemic on their businesses.
The executives ranked technology (44%) as the top investment priority post-pandemic, followed by store/restaurant re-engineering (28%); sales channel expansion (27%), and pandemic preparedness (22%), store/restaurant count expansion (12%) and store/restaurant redesign (11%).
In other findings, most (83%) C-level executives believe that retail and dining will be changed forever due to the pandemic. And 56% feel that the pandemic will permanently change the way people shop and that most consumers will move exclusively to buy online, pick-up in-store (BOPIS), buy online, pick-up at curb (BOPAC) shopping.
In other findings, 65% of retailer and restaurant chains plan to reopen all their locations, while 25% plan to open a portion of their locations. Only 10% don't plan to return to the brick and mortar channel at all, with some adopting an online-only approach and some closing as a result of fallout from the current crisis.
“The impact of lost sales during the economic shutdown will have a lasting effect on the survival of stores,” the report stated. “Only the strong will survive.”
Other highlights from the report are below.
• Employee compensation and safety ranked as the top (86%) priorities during the pandemic, followed by BOPIS and BOPAC improvements (67%), shifting headquarters to work-from-home mode (62%) and deliveries (57%).
Since fielding the survey, however, Cambridge Retail Advisors said it believes that financial issues have become a higher priority as retailers and restaurateurs deal with the economic reality of lost revenues for several months.
“It’s time to clean up the balance sheet, apply for grants, renegotiate rents and look for equity investments, the report said.
• Sixty-five percent of survey respondents said they had not been offered rent relief by their landlords.
“There are few guidelines or clauses in present-day leases that outline what tenants and landlords should do during a pandemic such as COVID-19,” the report said. “Both parties, retailers and landlords, are strongly incentivized to negotiate a deal.”
• Inventory management ranked as the most important (56%) supply chain need as a result of the pandemic, followed by technology (44%) and consumer supply chain visibility (19%).
To download the complete COVID-19 Impact Study – Retail and Restaurant Market Analysis, visit cambridgeretailadvisors.com/covid-19-impact-study.