A well balanced article on retail during recession5 Aug 2022 12:22
I like this bit think it reflects thg uite well apart from the eyecare example and thg were born during the 2009 recession
Ecommerce during the recession
Expect competition. During the global economic recession in 2008-09, traditional retail brands embraced ecommerce as a recovery strategy. Ecommerce was seen by many as a quick way to increase productivity, slash costs, and increase competitive advantage.
Ecommerce actually grew during the Great Recession. If you operate in a space where incumbents have been slow to embrace ecommerce, expect a downturn to accelerate the entry of new competitors. Be wary of increased market competition that could further fragment market share and lead to irrational pricing behavior.
Business model flexibility
Examining your business model is always smart business. Structural changes often result from economic crises, so you need to consider how they might impact your business. For instance, the COVID-19 pandemic may make lasting changes to how people work and from where, if remote work (distributed teams) proves its value to many traditional businesses. A global shift toward remote work would have major implications for the office building and office furniture industries.
The economics of business may also change because of increased competition, changing input costs, government intervention, or new trade policies. For example, companies in adjacent markets may opportunistically enter your market and compete directly. These changes may already be underway and accelerate during periods of economic decline (the trend toward cloud computing, SaaS, and streaming content, etc.).
There’s no crystal ball: Assessing how the world will look following an economic decline is difficult. Furthermore, repositioning your company for what’s next is something you may have to do multiple times.
For example, Warby Parker removed the friction of buying eyeglasses online by sending customers multiple pairs to try on and keep only the ones they like. Within 48 hours of launching in 2010, Warby Parker sold out immediately and wound up with a 20,000 person waiting list. It meant the company hit its first-year sales target in just a few weeks.
In the years following the recession, Warby Parker pivoted both its technology and business model to disrupt incumbents. The company experimented with virtual try-on technology to make home try-on redundant and reduce shipping costs. Warby Parker also expanded beyond ecommerce to open new physical shops housed within boutique retailers. Later, it evolved to enter a new $5 billion market by offering customers digital eye exams.
https://www.shopify.co.uk/enterprise/retail-during-recession
Sign In
Follow the stocks
