COVID-19: How will the retail sector survive the new normal?

The retail industry, one of the biggest sectors in most industrialized economies, has been deeply impacted by the COVID-19 pandemic. With lockdown restrictions and a decrease in consumer buying power, retail businesses around the world are struggling to survive in the new normal. Howard Saunders, Retail Futurist and Consultant at 22and5, shared his insights on the future of the retail industry in both South Africa and the U.K in a recent interview with CNBC Africa. Saunders highlighted the catastrophic impact of the pandemic on the hospitality industry, describing it as the heart of the economy. He emphasized that the global community has had its heart ripped out due to the closure of restaurants, bars, and social spaces where people typically gather. The unprecedented nature of the global economy being switched off almost instantly has led to high levels of unemployment and economic uncertainty. Saunders pointed out that in the U.K, the furlough scheme has delayed the inevitable rise in unemployment levels post-pandemic. However, as businesses start to reopen, many are facing challenges such as adhering to social distancing regulations and reduced capacity. In the hospitality sector, the two-meter spacing rule poses a significant threat to small restaurants and cafes, making it difficult for them to operate profitably. Saunders discussed the possibility of relaxing these regulations to one meter, which could help businesses adapt and innovate in the face of adversity. Despite the challenges, Saunders expressed confidence in the industry's ability to evolve and find solutions to navigate through these turbulent times. He acknowledged that there will be job losses in the retail industry, particularly in cities where remote work and flexible hours have become more prevalent. As a result, there will be a shift in the workforce as businesses adjust to the new normal and consumer behavior changes. While the road ahead may be challenging, Saunders remained optimistic about the industry's resilience and adaptability. As businesses continue to explore innovative ways to connect with customers and streamline operations, the retail sector will undergo a transformation that could shape its future for years to come.