The impact of COVID-19 on the Asian retail sector has been significant. The implementation of isolation measures led to many traditional retail businesses standing-down staff or closing. At the same time, other retailers experienced spikes in ecommerce orders and struggled to meet this unexpected demand.
As restrictions on retail trading are being eased in many countries across the region in line with economic recovery plans, many retailers will be uncertain. After all, reopening physical stores for business while COVID-19 is still active in the community presents a considerable number of operational challenges. So, what should retail industry professionals understand ahead of reopening, or scaling up their operations? What will be the new ‘normal’ in a post COVID-19 lockdown world?
Increased use of Mobile POS to eliminate customer bottlenecks
Given social distancing measures remain in place for many countries across Asia, eliminating areas where people concentrate instore must be a priority. One of the largest bottlenecks of people within a retail store is the check-out counter, where customers must line-up to be served. While marking floors with safe-spacing points for customers to stand while waiting to be served may help at a rudimentary level, retailers should move away from fixed POS terminals that require customers to queue. Additionally, self-service POS may not be the answer either as they require customers to touch the same device over and over, and often don’t work when customers are using gloves. Mobile POS technologies built into mobile computers allow retail staff to assist customers with product information, stock availability and on-the spot transactions from anywhere in the store, eliminating the need for check-out lines or use of self-service.
Retailers to take control of their reverse logistics operations
Customer returns became more complicated for retailers when purchased items couldn’t be returned to stores due to closures and this resulted in larger volumes of mail-returns. Mail returns are often managed by reverse-logistics providers, who were themselves disrupted by COVID-19 social distancing rules for warehouse operations, which has led to lengthy delays in retailers receiving the stock again for resale. And if the stock being returned was seasonal, these third-party reverse logistics delays could result in products not being able to be resold at all. To ensure full control over the sales and returns supply chains, retailers should take control of their own reverse logistics operations to speed the time in which they receive returned stock for resale.
Investment into inventory visibility needed
Retailers operating across Asia cannot sell what they cannot see. Online order levels grew to record highs over recent months and many retailers were simply unable to keep up with demand, or find the right inventory to fulfil new orders. This resulted in many retailers resorting to cancelling sales, or only partially fulfilling them. The common cause for these issues is that the retailers’ own warehouse management systems (WMSs) were telling them that they had stock to sell, but because of the massive volumes going through their Distribution Centre (DC), often by the time that orders were ready to pick-and-ship, the inventory was no longer available. This false record of inventory arises when an older WMS is in place that does not update inventory levels in real-time. Asian retailers need to upgrade to a WMS that models demand and instantaneously updates inventory details to ensure an accurate picture of stock on hand for sale and shipment every time.
‘Fulfilling from store’ is the new standard for retail flexibility today
The consumer behavioral shift to online shopping , which has been accelerated by COVID-19, has increased the business case for an expansion of hybrid fulfilment methods that blend ecommerce and store resources. Hybrid fulfilment offers retailers increased flexibility enabling them to pivot, scale, adjust and respond as things change and return to normal. Fulfilling online orders in retail stores is a by-product of this new economy. Customers enjoy picking up online purchases in local stores, which satisfies their insatiable demand for immediacy and flexibility. Further, ship-from-store is vital in an age where ecommerce orders are booming and bricks and mortar operations are operating at much lower levels. Technologies exist today that support underutilised retail staff to handle store order picking, staging, packing, shipping for fast delivery and customer pickup.
Learn, adapt, grow in a post lockdown world
The Asian retail sector has faced immense challenges through the COVID-19 period. Many businesses are now trying to answer the question of how to deliver high levels of customer service while practicing social distancing and protecting staff, and those that closed their physical stores temporarily will be faced prospect of reopening with out-of-season stock. However, in every crisis there are learnings, trends and innovation. It will be those retailers that seek to understand and adapt that are best positioned to create better customer experiences, capitalise on opportunities and grow.
About Manhattan Associates
Manhattan Associates is a technology leader in supply chain and omnichannel commerce. We unite information across the enterprise, converging front-end sales with back-end supply chain execution. Our software, platform technology and unmatched experience help drive both top-line growth and bottom-line profitability for our customers. Manhattan Associates designs, builds and delivers leading edge cloud and on-premises solutions so that across the store, through your network or from your fulfillment center, you are ready to reap the rewards of the omnichannel marketplace. For more information, please visit www.manh.com.au.
Written by: Richard Wright, Managing Director Southeast Asia, Manhattan Associates