For retailers and consumer brands, changing consumer behavior, increased costs and margin pressure isn’t new. However, the events of the last few years have accelerated trends and created permanent shifts that require retailers and consumer brands to rethink their business models.
Looking ahead, retailers will need to focus on transformational change, corporate streamlining, business model optimization and more fully integrate digital technology and data to respond to shifting consumer demands and global events.
KPMG’s very first Global Restructuring Services webinar takes a close look at the key challenges facing retailers today and what lies ahead for the retail sector. The webinar is hosted by KPMG’s retail and consumer leaders, James Stewart, National Leader, KPMG Australia, Lisa Bora, Partner in Charge, Corporates, KPMG Australia, and Massimo Curcio, Associate Partner, KPMG Italy. Special guest, Sami Kahale, joins the panel to share his insights as the former CEO of Esselunga, the Italian supermarket chain and one of the most successful FMCG businesses in Europe’s retail sector.
Key takeaways from the session
- The customer experience demands an omnichannel approach. The pandemic has created structural changes to the ways consumers shop and engage with their brands. Online shopping increased 100 percent in many markets during the pandemic, however, the physical store remains a critical part of the overall experience. The challenge for retailers will likely be to enhance the value of their physical locations as part of a hybrid and omnichannel customer experience alongside online experiences.
- Supply chains should be just-in-case, not just-in-time. COVID-19 and current geopolitical events have created unprecedented disruptions to the global supply chain. As a result, costs have increased four-fold and lead times have doubled. To be successful retailers should strategically manage their supply chain, identifying the suppliers to trust and the places in the world where to best source supplies. Further, greater collaboration between retailers and brands can collectively drive down costs, while maintaining flexibility and service.
- ESG has been elevated from a “nice to have” to a “must have.” Prior to the pandemic, most consumers were focused on niche environmental concerns, such as the use of plastics. Now, the focus is broader and younger consumers are calling on retailers to demonstrate how they are challenging larger concerns, such as biodiversity or social concerns. To respond, retailers should declare ESG as part of their core strategy that impacts every part of the business from product design, material sourcing, the type of manufacturing facility, and so much more.
- Consumer-focused business models. Different business models can be successful in today’s environment. The key to success, however, lies in aiming to ensure that the customer is at the heart of all business decisions.
- Hybrid working models require new types of employees. — The pandemic has created a step change in the workplace that requires greater flexibility on behalf of employers, leaders and employees. Hybrid work is here to stay, and retailers should offer employees the opportunity to work beyond the office. In addition, retailers should reconsider the qualities and skills they need in employees, helping to ensure they remain agile and nimble to respond to change.
Watch the webinar
