subject: What impact has the recession had on the retail market? [print this page] The retail market was just one of the industries hit by the global economic downturn, as shoppers were forced to limit their spending and consumer confidence was shaken by the collapse of retail giants. With the retail market finally getting back on its feet in 2010 particularly the online sphere, where UK web sales reached an all-time high of 5 billion in July one of the most pressing issues is whether there will be long-term effects on consumer confidence and spending.
A 2009 study by Roland Berger, titled Retail and the Recession, identified three key areas of the retail industry that are expected to experience lasting effects from the recession namely consolidation, structural shifts in the supply chain and an increased focus on value retailing as consumer spending is more driven by deals. More than half of retail leaders surveyed said they expect to see long-term, fundamental changes to the industry as a result of the recession.
Consolidation was indentified as a major focus of the retail market in the coming years, due to consumer wariness over buying from lesser-known companies. With many retailers shutting up shop no sooner than they have begun, analysts expect that the next few years will see 'big players get bigger,' as the supply base becomes more concentrated.
Rationalising the supply base is one step retailers can take to optimise their supply chain structure, cutting costs in more areas of the business, while two-thirds of those questioned by the study said they believed discounted goods and services will continue to play an even bigger role in consumer demand, as the recession leaves a more money-savvy customer base in its wake.
Evidently, it's not just prices that appeal to UK shoppers in the new financial climate; reliability and security are playing a larger role than they did pre-recession too, as shoppers who have been personally affected by, or heard stories of companies closing down, are now more likely to turn to big names that they can trust.
This not only means making sure their goods arrive safely, but also taking optimum care of what they do have, such as taking out home contents insurance UK to cover their belongings against damage, loss or theft. With today's consumers being less eager to splash their cash' on every new gadget that comes their way, the focus is instead on choosing products that boast reliability and lasting value.
What impact has the recession had on the retail market?
