Getting Retail and Wholesale back to business

Could the pandemic reshape retail business, from markets and the high street to specialist outlets? Barclays has supported UK retail for more than 300 years and its national network of specialist teams now support a significant market share. Head of Retail and Wholesale for Barclays Corporate Karen Johnson shares her views on how businesses have adapted to new challenges, the support available to the sector and how the consumer landscape could change.

Retail and Wholesale insights

The retail sector comprises over a third of all consumer spending in the UK, but the lockdown prompted by the coronavirus pandemic resulted in the closure of the non-essential stores, which make up 70% of retail units, for 11 weeks. 

Supermarkets and pharmacies had to swiftly adapt to unprecedented circumstances, implementing new social distancing measures, and many other businesses pivoted to online order and collection services.

Meanwhile, wholesalers have faced different challenges, from social distancing and hygiene measures, to delayed overseas supply chains. There’s also a new need to predict rapidly evolving consumer demands.

Financial support has been vital in helping businesses maintain cash flow while navigating these obstacles: government schemes like CBILS, CLBILS, and the Coronavirus Job Retention Scheme are available, alongside 12-month business rates holidays, protection from eviction for commercial tenants and options to defer VAT payments

Barclays is also offering educational resources to support businesses through challenging times, from weekly client calls and newsletters to online webinars. Karen Johnson, UK Head of Retail, Wholesale and Healthcare at Barclays Corporate Banking, advises that keeping clients informed is essential as they adjust to the “new world” of retail, after Covid-19.

Over the last three months, more people have switched to buying online and have got used to having their purchases delivered to their doorstep. To survive, businesses will have to adapt to a more digital world going forward.

Resetting Retail

Many retailers have started to reopen following the Government announcement in June, albeit with changes to their ways of working.

“Over the last three months, more people have switched to buying online and have got used to having their purchases delivered to their doorstep. To survive, businesses will have to adapt to a more digital world going forward.” This could result in extended returns policies, an expansion of well-established home delivery and increased use of ‘click and collect’ services: “There will be more online transactions, but there will also be more places to go and pick up goods at your convenience.”

The pandemic has also accelerated the use of card payments, a trend that Barclaycard innovation could help facilitate.

Johnson says we have seen businesses adapting and thinking more creatively to cater to their audience, placing a greater emphasis on experiential elements in their stores: “With a reduced need for people to visit the high street to purchase goods, retailers have to give reasons for them to make the effort. Retailers need to reflect on what people will have missed during lockdown and try to present some of this within their new store propositions, whilst also adhering to government re-opening safety guidelines.” 

“Consumers will reset their relationships with brands post-coronavirus,” she adds. “They will align with those behaving responsibly when spending their money. How businesses treat employees, suppliers and their role in the community will be important. This doesn’t just call for a marketing change – but a change in how retailers conduct business.”

The specialised industry knowledge of the Corporate bank’s relationship team will continue to be an asset for clients. 

The bank is well placed to help businesses move forward: “Our leading digital solutions, as well as market insights and thought leadership, are key to helping our clients adapt and adjust in these unusual times. They benefit from having a Relationship Director who understands the industry and is on hand to support them.”

How will Barclays help businesses prepare for future changes to the sector?

It is estimated that covid-19 has accelerated existing digital trends by three to five years. Barclays is providing help and support to retailers of all sizes and across all channels to prepare for the ‘new future’.

Evolution of card payments
The Barclaycard team is not only dealing with the current situation – for example, increasing the contactless payment limit and moving card terminals to support social distancing – but also looking to the future and how clients can enhance their e-commerce platforms and exploring alternative in-store payment methods which reduce the need for contact.

Processing of cash and cheques
Whilst usage has decreased significantly, stores need to be re-cashed and their employees are seeking safe and efficient ways of handling cash and cheques. The Barclays cash team has a variety of solutions that support efficiency as well as security.

Trade and supply chains
The pandemic led to many supply chains being disrupted, and new supply chains evolving. Barclays is supporting clients with this transition through working capital analysis tools, innovative funding structures and risk mitigation solutions, while continuing to digitalise our processes.

Operational efficiencies
Barclays has provided a range of digital solutions to support retailers’ finance teams working remotely, as well as guidance on how to protect the business from fraud. As these teams return to offices, our colleagues are communicating with our clients, to implement new and more efficient ways of working. 

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