Navigating retail in the post-Covid-19 era: Welcome to the Paranoid Economy

THE Covid-19 pandemic has exacerbated the disruption retailers both big and small have been facing for some time now, due to e-commerce, digitalisation, changing behaviour and shopping preferences of consumers. The writing has been on the wall for more than a decade as iconic, established department store retailers such as Neiman Marcus, Macy's, Nordstrom and Robinsons struggle to re-invent the in-store shopping experience and seamlessly integrate online shopping and fulfilment while managing the high costs of their brick-and-mortar retail operations.

GlobalData Retail reported that more than 190,000 stores accounting for nearly half of retail square footage in the United States have closed due to the coronavirus crisis. Many of these that are non-essential stores may never re-open. Some of the established chains such as Neiman Marcus, J. C. Penney, Pier 1 Imports and J. Crew have filed for bankruptcy. Closer to home, Isetan shuttered its store in Westgate mall in Jurong this year, and Robinsons will close its department store at Jem in August.

On the other hand, discounters and big-box retailers that carry both essential and non-essential products such as Walmart, Costco and Target have transitioned successfully to an omni-channel (online and offline) retail business model offering convenience, variety and value by leveraging on their extensive physical-store network and providing O2O (online-to-offline) services such as order online and pick-up, return or exchange at the store in addition to home delivery to boost store sales.