Post-disaster recovery of retail business | Sunday Observer

Post-disaster recovery of retail business

Coronavirus is a global crisis and the whole world will most likely be plunged into a recession.
Coronavirus is a global crisis and the whole world will most likely be plunged into a recession.

Late Milton Hershey, the American chocolatier and founder of one of the largest chocolate manufacturers in the world, The Hershey Company, once said that he believed that his business is recession-proof and depression proof.

It is time that the retail sellers in Sri Lanka also take the cue out of Hershey’s quote and decide what to sell and how to sell to a literally depressed and cash strapped majority clientele in the country. The general world trend is that consumers prefer lower priced goods and services immediately after a short term natural catastrophe irrespective of the socioeconomic status of a country.

Sri Lanka is facing a crisis, no doubt. For retailers, effective crisis management, irrespective of whether the business is small, medium or large, will be the key to success or failure.  By focusing adequately on the future and accepting the crisis as an opportunity, they have a fair chance of recovery, even growth. It’s not going to be easy with slow sales, reduced foot traffic and low cash circulation. However, the retailers must try to capitalise on the conception that customers always like to shop personally because of the sense of control they acquire when purchasing retails, especially consumables. 

First and foremost, the retailer must prepare and devise a plan to restart after the panic passes. Sooner or later the situation will undoubtedly improve as was in the past. Retailers will have to make up for the lost business in order to recover fixed expenses during the closure. Therefore, it is sensible to research how or whether the merchandise possibly can be altered to meet the new situation. Depending on the result of the research, the owner must make a plan to convey an effective message to the clientele, both existing and prospective, through the most suitable relevant medium

The retailer can effectively apply social media, hand outs, point of sale advertisements or simply a street promotion drive near the store. In my personal opinion, a creative, strong and properly updated face book account can be the key approach to communicate with customers for a small or medium size business.

Moving outdoors is a good strategy at a time when the retailer looks for more foot traffic, the general purpose of retailing.  By entering into a nearby sidewalk with an attractive slogan, may be related to the existing circumstances and can be thoroughly effective. When the goods are moved out with a well created outlook, people may become curious and will want to check it out.  This may attract even the customers who usually ignore the store as well.  

Creating an event in the store will produce amazing results. Invite your customers and appeal for their help. They will not ignore or abandon you. Customers who were indoors for a long time with restricted movements will love to move around in a stimulating and vibrant environment rather than going to the same gloomy day-to-day store. This is successfully done as a practice by many retail stores in dead months to draw customers. The vendor can also offer a suitable promotional item, ideally suited to the prevailing situation, to make the event more attractive and to encourage more visitors.  

Take the advantage of this lull to redesign the store. Customers who patronised the store will appreciate and admire a brand new set up and a livelier outlook. You do not have to be a creative designer to introduce novel decorations or arrangements to the store. Simple things such as shifting furniture, changing wall colours, adding flower pots and so forth will be sufficient.  As you had been in business in the location previously, you have a good understanding about the general behaviour of customers. The public in general are looking for novelty after a strenuous period in time. Hence, you can take the full advantage as a smart retailer to increase patronage.    

As you have already suffered due to the public panic and the long closure, a simple short term financial plan must be   devised to overcome the immediate concern. President Rajapaksa has already ordered many useful financial concessions through Banks and other financial institutions and other packages to the benefit of small and medium size businesses. This is a terrific consolation to businessmen of all sizes. 

Retailers can make the maximum use of these facilities, concessions and special considerations offered by the Government. In addition, there are other programs planned by the Government that can be of assistance. Hence, it’s good to be vigilant about all related state aid projects which will be in place to combat the economic issues when the pandemic threat is over.         

Renegotiating the rate with your merchandise suppliers under the new situation is a good idea. Retailers must remember that they are also affected and looking forward to re-establish themselves. Therefore, treat this as an opportunity to renew the prices where you can pass on a part of the additional benefits to your own buyers, if you succeed. In a similar tone, the retailer may strike a bargain with the service providers for equipment rentals, store rent, insurance premiums and janitorial fees to reduce costs of operation. 

In Sri Lanka, employers do not lay off workers in a situation such as this, as is done in many so called developed countries.

Therefore, an attempt must be made to use the workers  to participate in something productive from home, to be used when the locked down period is over. Of course, you can discuss and get their opinion to cut costs temporarily to survive with shared burden. No employee would want to leave a job at this juncture as work is scarce in this crisis. Hence, reasonable adjustments also can be made with the existing staff.   

Coronavirus is a global crisis and the whole world will most likely be plunged into a recession. Therefore, all retailers must be mindful that the best weapon to win this battle is to focus on the future.

Your preparations and planning for the immediate future is utterly important to make the fastest recovery. Contribution of every business entity, big or small, will decide how fast the already ailing economy can be placed back on its feet. Particularly, this contribution is vital at this crucial time where the economy is almost at the bottom of the pit with failed past few years with awfully low growth rate and the Government is struggling to make the ends together.