The pandemic has had an impact on brick-and-mortar retail, but its difficulties have been exacerbated by known competition from e-commerce sales. However, recent data reveals that brick-and-mortar retail is demonstrating an extraordinary level of resistance to this threat. Despite the challenges that brick-and-mortar stores face, people still prefer to shop there. Although eCommerce is growing, many people still prefer the in-store shopping experience, where they can touch and feel a product before taking it home. Whether a business is brick and mortar or strictly online, retail shopping is a thriving industry. The Brick-and-Mortar store exists at the crossroads of what the Customer wants and what the Retailer wants!
The global retail market generated sales of more than 26 trillion US dollars in 2021, with sales expected to exceed 30 trillion US dollars by 2024. Though the numbers are impressive, we still need to recognize the problems and risks, the brick-and-mortar stores are facing. One biggest problem is eCommerce competition. Most physical retailers are still catching up to the massive shift to e-commerce, which has accelerated during the COVID-19 pandemic and may account for one-third of all retail sales by 2030. Even in this day and age of E-Commerce, the vast majority of retail sales are still conducted in person in a physical store. Even Millennials visit a physical store 50% of the time. Customers prefer an Omni-channel experience rather than a single channel experience.
Many retail chains began to address the supply chain issue a few years ago by shifting significant inventory to their stores, effectively transforming them into mini-e-commerce order fulfilment centres. Stores can act as fulfilment centres and hubs that are much closer to customers than Distribution Centers can ever be. This allows stores to provide more shipping/pickup options while also increasing network capacity, supporting growth, and even lowering shipping costs. Customers can have their goods picked up or shipped locally in whatever manner they prefer. Retailers can make more goods available to customers faster by leveraging inventory in and across stores.
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