What the Return to Retail Could Look Like
The roll out of vaccines in key markets has retailers taking a more serious look at what retail may look like as lockdowns are lifted and socializing becomes less distant.
There’s much debate about what consumers will do – when given a choice.
One camp is betting that having gotten used to e-commerce they’ll continue to opt for online shopping.
On the other side, people predict a surge in foot traffic as consumers return to physical stores – not just because they like the IRL shopping experience, but because it’s a touch point with ‘normal’ or ‘better’ times.
But from a consumer point of view, physical retail and e-commerce aren’t necessarily seen as two competing channels but simply as part of the overall retail landscape.
Who will benefit from a return to bricks and mortar; How e-commerce could evolve
Even a week after Chinese New Year, exports are still at peak season levels, causing continued havoc at ports in the US and Europe.
LOGISTICS
- Surging U.S. demand is keeping ocean rates near $5,000/FEU and West Coast ports swamped with inbound cargo.
- Rates to Europe fell 2% in the past week, but still exceed $8,000/FEU – up 409% year-on-year.
- Many Chinese factories did not close during Chinese New Year, keeping outbound exports at peak season levels.
- Shippers are being advised to divert to alternative ports as it is unclear when the West Coast ports might be cleared.
RETAIL FINANCE
Frasers Group (UK) expects sales to take a hit of more than £100 million after the government said non-essential retailers in England would have to wait until April 12 at the earliest to reopen.
US retail sales could rise 6.5% – 8.2% percent in 2021 on the back of the vaccine rollout according to the National Retail Federation. Retail sales grew an estimated 6.3% in 2020, how much of the growth was in non-apparel categories.
Macy’s (USA) fourth-quarter net income of $160 million. Sales slid nearly 19% year-on-year to $6.78 billion in the quarter ended Jan 30.
TJX (USA) said net sales fell to $10.94 billion in the quarter ended Jan. 30, from $12.21 billion a year earlier. Net income fell to $325.5 million, from $984.8 million a year ago.
RETAIL EXPANSION
Heyday (USA) is planning an agressive brick-and-mortar store expansion via franchising.
- The skincare and facial treatment company closed a $20 million series B round of funding led by Level 5 Capital Partners (L5). L5 has committed to opening 40 stores in the next 5 years, part of growing the retailer’s physical footprint to hundreds of stores during that time frame.
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