Shoppers set to shun flimsy goods with homeworking likely to drive growth in suburban retail

The post Covid landscape is likely to lead to a ‘buy to keep’ mentality amid consumers, with shoppers likely to begin to shun flimsy and disposable products in favour of quality, one of the UK’s leading retail experts has claimed.

With large swathes of the British retail industry beginning to reopen open for business this month, Sue Richardson, head of retail for KPMG in the North, told The Yorkshire Post that the sector was in for seismic changes.

Ms Richardson said that the lockdown of more than two months had led to more older people beginning to shop online and that the the trend to digital shopping was now likely to accelerate beyond previous models.

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She predicted that the likely permanent shift to homeworking would continue after the lockdown ended and this in turn would also shake up the sector, leading to more retailers basing themselves in suburbs as city and town centre destinations see some demand dry up.

Retail set for big changes

Ms Richardson said there was a clear move towards “buy to keep rather than buying something to use once and throw or give away”.

“That is a huge concern for retailers and something that is very much on their agenda to be able to demonstrate their credentials in that area,” she added.

As retail and three million jobs it supports returns to business, the landscape is likely to be tough. In China, generally viewed to be two months ahead of where the UK is in terms of dealing with the coronavirus pandemic, retailers are only operating at about 30-50 per cent of what would have been expected.

Ms Richardson said: “From a demand perspective I do think one of the areas that is going to struggle is clothing and footwear and the reason that will be the case is that the driver of buying clothes is when we go out socially and when we go on holiday. If we are not able to do those things or are doing it a lot less it reduces demand.”

Sue Richardson - KPMG

She added: “The big concern that retailers have, that people just won’t want to go to shops and also that they won’t have the money, or the reason, to be buying. Larger out of town warehouse style retailers will find it easier but most high street retailers have a single point of entry and exist, presenting problems.”

Prior to the Covid-19 outbreak, modelling had suggested that 50 per cent of retail sales would be online by 2025. However, Ms Richardson said that this had now been brought forward to next year, largely driven by older people beginning to shop online.

“It has put a whole population of people online that were not previously,” she said.

“The way the channel shift was working before was that the older generation were not online and were not planning to. Whereas what you have got now is a population that have gone online that probably would not have done so before.”

Ms Richardson added that the trend of people working from home was “absolutely here to stay”.

“I don’t think we will all be holed away t home they are now but there will be a much bigger shift towards working from home and that in itself has quite interesting implications for retailers in terms of demand. If you are working from home more, you will need less places that sell you lunch or coffee in business areas and more lunch or coffee places in suburban areas.”

And she added that the retail talent and expertise in Yorkshire would help the region fair better than others.

"Unlike pretty much any other region we have two of the big four grocers headquartered here. What that means is that there is a huge amount of retail talent that has been developed in those businesses over the years and then often span out into other retailers in the region.

"There is a really high relatively speaking number of retail headquarters - those exciting tech firms are based in a great area."