Looking Ahead: Retail Industry Challenges and Opportunities in 2021

retail industry challenges and opportunities

In the face of an uncertain future, retailers need to find a sustainable solution for growth. The exact nature of the UK economy and consumer confidence remains an unknown commodity. However, what many retail brand owners recognise is that while customers will eventually return to the high street there are strong signs that pivoting to an omnichannel solution will be advantageous, and possibly essential, for a healthy business.

A New Normal: The Biggest of Retail Industry Opportunities?

Crucially, retailers may have to consider that the biggest retail industry challenges facing them may also be some of the biggest retail industry opportunities. The continuing rise of ecommerce is the overwhelming priority with large and small retailers recognising the value of an online and traditional storefront.

Lockdown conditions proved to the UK public that there is a world of retail beyond the high street. Many people who may not have shopped online before found themselves adding to virtual baskets and paying with e-wallets.  The consumer now understands there is abundant choice online with the added benefit of being completely safe and endlessly convenient.

Challenges facing retail brands include how to balance the high street channel with the digital channel.  Omnichannel systems are nothing new but pandemic conditions have forced the hand of many businesses over the past 12 months. There is now a critical need for the physical storefront to communicate and connect with the online storefront. Customers may choose to safely ‘Click and Collect’ items at a local store after browsing online, for example. Post-pandemic, this is likely to be one of the primary justifications for keeping bricks-and-mortar alongside ecommerce solutions.

One of the biggest uphill challenges facing retail in 2021 will be increasing demand. Sudden spikes during the early days of the pandemic lockdown caused mass stock shortages. Since that time, many retail businesses have worked hard to pivot online, with many looking at ecommerce for the long-term.  Distribution models also changed with many businesses selling direct to the consumer for the first time, instead of via a business.  Flour millers are one example; with cafes and bakeries closed, and the interest in home baked sourdough, artisan millers delivered direct to consumers, pivoting to smaller bag sizes, increased customer volume, lower order values and more.

Some firms have already started implementing retail software solutions to keep pace with the rise of ecommerce and the growing need for omnichannel sales. Omnichannel retail technology often begins with an EPOS system (Electronic Point of Sale) which seamlessly connects both online payments, till systems and the business management system together. If there is a significant lesson retail and distribution companies are learning in 2021, it is that seamless communication is the key to customer satisfaction. The ability to analyse consumer trends with the wealth of data that connected systems deliver, can be game-changing for retailers, from an efficiency standpoint as much as quality assurance.

Future-Proofing Retail

The solution to successful omnichannel retail lies with fully integrated business software to seamlessly blend multiple retail channels together. The aim is to develop a single, scalable business system which connects every part of the retail operation, from online orders and finance to purchasing and distribution. The key to the success of a single business management system is recognising that there is no off-the-shelf ERP system (enterprise resource planning) to meet the needs of an omnichannel retailer.

There must always be a fit-for-purpose ERP system at the heart of a retail business to which additional software products are connected. Each software product will perform a vital role and manage critical processes within retail operations, such as third-party courier software or automated ecommerce order processing. By connecting each product, you enable them to communicate with and update each other in real-time – this is what software developers refer to as ‘fully integrated’.

For example, CRM software (customer relationship management) can be connected to an ERP system, such as NetSuite or Sage, to bring all aspects of the customer journey into a manageable workflow alongside financials, supply-chain, and order fulfilment. A fully integrated retail ERP system effortlessly blends sales channels with the complex daily activities of the retail operation, in real-time, to ensure every aspect works and grows together.

Proven, Industry Leading Retail ERP Software Development

Kinspeed is committed to delivering industry leading excellence in integrated retail solutions. With a proven record of supporting some of the best-known retail brands, Kinspeed deliver scalable, bespoke software solutions to meet the challenges retailers face every day.

Discuss your retail industry challenges with Kinspeed today to explore how a forward-thinking software solution can deliver sustainable growth for UK retailers: email info@kinspeed.com or call +44 (0) 1246 437000.