Disruption continues for business post-Covid

Whilst the worst of the pandemic appears to be behind us, it would be naive to think the business impact is over.?

We have now entered an unprecedent period of global economic uncertainty due to the Russia-Ukraine conflict and Australian retailers are navigating the implications of a war on the other side of the world. At home, the floods have displaced thousands of people, destroyed businesses, and impacted the movement of essential goods, resulting in product shortages and price fluctuations.?

And of course, climate change is gathering pace as the greatest disruptor we’ve seen.

We are now living in an ongoing period of disruption. To succeed in these intense times, government and industry must draw on the lessons and skill sets developed through the pandemic.

In truth, disruption has been a constant for the retail sector over the last few decades with the pandemic being one of the most intense pain points, severely impacting business’ ability to trade. Most recently, weaknesses have been exposed in our supply chains and staff shortages remain an ongoing workforce concern.

There have of course been great learnings and some silver linings from the pandemic.?

Covid has revolutionised retail for the better in several ways with accelerations in technology and innovation driving efficiencies and improving the overall customer experience. Businesses that were hesitant to leap into the digital space had their hand forced by Covid as lockdowns prevented trade from physical stores. Contactless shopping, direct to boot deliveries, click and collect and augmented reality were in their infancy before Covid but have been embraced by businesses and consumers alike. E-commerce is on an incredible trajectory with online sales up 28% compared to a year ago and businesses are continuing to direct their resources into data and digital innovations that will keep them at the forefront of new and exciting consumer trends.

However, the pandemic also highlighted faults in the way federal, state and territory governments work together and treat businesses. We need a unified approach between governments, business, and industry during times of crisis, not a disjointed one like we saw during the worst of Covid. Lockdowns, hot spots, and category classifications like ‘essential retail’ meant different things in different jurisdictions and there were many inconsistencies across the country that made little sense.?

During the Delta lockdowns, the same ‘type’ of shops that could stay open in Sydney had to close in Melbourne. There was no nationally consistent definition of what ‘essential’ retail was, which led to mass confusion for businesses with a national footprint. All of this hampered agility and business confidence – both costly to business during a period when they could least afford it.

Government consultation with industry is key in all of this, and many of the problems we saw during the worst of the outbreaks could have been avoided with a few phone calls before drastic decisions were made by state and territory leaders. There were many circumstances during the snap lockdowns last year when governments could not explain their own restrictions, and businesses were left on hold for days trying to get answers. The absence of a national framework was debilitating.?

The fundamental lesson from all of this is that governments need to work with business and consult during times of crisis and unprecedented disruption to ensure that jobs are not impacted. And this is more important than ever as we navigate the global economic uncertainty stemming from the Russia-Ukraine conflict and the impacts of climate change.?

Supply chain disruption, inflationary pressures, skills shortages and impacts to global energy supplies are all taking a toll. Retailers do their best to absorb these costs as best they can, but things eventually reach and tipping point, and there is no option left but to pass on these costs to consumers. With every price increase, a retailer risks losing a customer.?

Tackling any sort of crisis requires a collaborative approach, and the solutions sit jointly with government and industry. Businesses will underpin the economic recovery and need to be empowered by governments to get us on a path to prosperity.?

With recent unprecedented bushfires, floods, and pestilence - the effects of climate change are a true reality and growing in importance. Let us hope we can capitalise on key lessons from the pandemic.