UK retailers affected as consumers stockpile

Retail experts say the impact on the industry of the novel coronavirus could last until the end of the year and that it will take some time before it is "business as usual".

"Global supply chains will be severely impacted," said Karl McKeever, a retail analyst and director of retail agency Visual Thinking.

The extended factory shutdown in global city hot spots will have caused immense problems in supply chains, he said.

According to a new survey from consultancy Retail Economics and global law company Squire Patton Boggs, almost a quarter of the United Kingdom's retailers surveyed－in sectors including food, fashion, health, and beauty－say supply chain disruption is having a significant impact.

However, around 7 percent of them have supply chains that are flexible enough to allow them to switch suppliers.

"Whilst there is stock 'in the system' for now, summer and autumn ranges will clearly be a scramble to pull together," McKeever said. "Fast-fashion retailers will be particularly vulnerable as their lead times are shorter and they rely on more precise and reliable continual supply lines."

He noted that now is a "key time", as orders are confirmed for production of Christmas goods.

"On the upside, there is likely to be a windfall boost for the UK or other local-to-market suppliers, operating closer to home, whose operations are currently unaffected and supply lines can be immediately accessed and new relationships formed," he said.

Worries spread

Consumers have also been rushing to stockpile goods because of the outbreak of the virus, and the COVID-19 respiratory disease it causes. More than a third of consumers are worried about product shortages, and one in 10 consumers have started to stockpile, according to the survey.

McKeever described COVID-19 as "the biggest test to global retail marketing we have seen", but in order to mitigate long-term effects, McKeever believes retailers should act "fairly and responsibly" and not seek "to benefit from the problems".

Meanwhile, the Association of International Retail, or AIR, has launched a plan to boost the future recovery of the British retail sector.

"While the outbreak has hit international travel from many countries, our retail recovery plan focuses on restoring and growing Chinese visitor numbers as the most effective way of repairing any economic damage," the association said.