By Tejas Dave, Founder and CEO of eBusiness Guru and Avasam
It’s tough out there for retailers right now. Brexit is causing all kinds of concerns – just this week we heard of Domino’s spending £7 million to stockpile ingredients.
Whether you’re a leaver or a remainer, just the uncertainty is causing havoc with spending. In July, average retail sales to July rose by just 0.5% – and that’s a new record low.
Brexit aside, it’s still tough. UK spending growth is at a low, and companies are entering administration regularly – more than we expected possible. Even household names we might expect to be doing well are demanding reductions on their rent. Even Primark, which continues to thrive, is demanding rent reductions – though this is in response to those with CVAs.
Many media outlets are decrying eCommerce for the decline of the high street. eCommerce businesses can provide lower prices due to lower overheads, and greater convenience, with next-day home delivery in many cases. But eCommerce has been growing for over twenty years – it’s hardly a surprise that was sprung on the high street overnight. Not only that, some retailers continue to grow – Primark makes huge profits without even having an eCommerce presence. And consumers are in fact still spending – eCommerce sales are expected to exceed £184 billion in the UK in 2019.
So what’s the solution? With greater overheads, without cutting margins razor thin, how can the UK high street survive? Even without facing these difficulties, retailers needed to look to their future, by taking their cue from eCommerce. Going forward, eCommerce isn’t the enemy – and in fact, could be the saviour of the UK high street.
Taking a blended, omnichannel approach will help customers remain engaged with retailers. Even Amazon is working to create offline locations – just look at Amazon Go! We’re not saying that all retailers should try to emulate their business model – clearly that isn’t possible. But by increasing offerings and services, bricks and mortar retailers can remain popular with customers.
These partnerships can be mutually beneficial between online and offline retailers. Where high street locations aren’t economically viable for businesses, creating partnerships can enhance the customer experience and profits all round.
Consider a small high street retailer who partners with an eCommerce company that aligns with their brand values. They might keep very limited stock for certain items, with more stock available to be DropShipped directly to customer homes. The customer sees the item and decides to buy it. The store then places the order and takes payment. Their eCommerce partner sends the order the same day, to arrive the next day.
The customer benefits from the arrangement because:
· They’ve made sure they want the product
· They can speak to an advisor
· They know their order was placed successfully
· They don’t have to put their card details into a website
· They know which day their order will be delivered
· They don’t need to be confident with using technology
This arrangement is great for customers who prefer to shop offline. Both retailers benefit – and chances are, the customer bought another item while they were in-store too. Even if they didn’t it’s likely with a positive experience, they’ll return to make further purchases.
If the retail location can process returns too, they see increased footfall and in-store sales. Customers receive an enhanced experience from both brands, and the eCommerce company receives more sales, faster returns and reduced costs.
Further application of technology can provide bricks and mortar retailers with more options to increase footfall. Click and collect sales are expected to account for 61.2% of spend by 2022. Whether that’s through partnerships or through lockers in-store, that’s a lot of potential to work with.
Partnering with eCommerce businesses isn’t the only way retailers with outlets can diversify their offerings though. Consumers are becoming accustomed to ordering a wide range of products in one place. High street retailers can capitalise on this. A reciprocal arrangement might provide an EPOS point showing stock a partner across town has. The point might have various options – for click and collect, home delivery and different payment options.
There isn’t a magic solution to save the high street. But the government is aware, and is looking at changing the planning system to help. Brexit will happen, one way or another. But with the right application of technology, and thinking creatively, retailers can adapt and secure their growth into the future.
About the Author
Tejas Dave, Founder and CEO of eBusiness Guru and Avasam, has been helping eCommerce businesses worldwide since 2010. Evasam is a platform that allows wholesalers and sellers to collaborate. Tejas is revolutionising the shipping industry and creating a new level of financial stability with the aim of creating 5,000+ jobs within the UK. Tejas is using technology and automation to provide solutions to e commerce challenges by removing the limitations that are currently placed on what and where people can sell.