Why Starting a Grocery Business is profitable during COVID-19?

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Why Starting a Grocery Business is profitable during COVID-19?

TABLE OF CONTENTS TABLE OF CONTENTS Your Retail Coach

01

Introduction

02

Mode of Businesses

Challenges

04

05

06

Benefits

Opportunities

03

Summary

INTRODUCTION MISSION STATEMENT Your Retail Coach Since the onset of COVID-19 early this year, grocery retailing has presented immense growth opportunities. Consumer behaviour has quickly shifted to contactless and hassle-free purchase of grocery products, which along with medicines, form the bedrock of human survival.

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01

Mode of Businesses Table of Contents

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Offline – Brick & Mortar: ●

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These are traditional grocery businesses which consist of physical stores in one or multiple locations, where customers can browse items and buy in person.

Examples : Big Bazaar, D Mart, Spencer’s Retail, Star Bazaar, Reliance Fresh, etc

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Online – Local Grocery App/Webstores :

With the grocery business model having undergone a transformation, smaller physical stores are now reinventing themselves to compete with bigger brick & mortar outlets and established online supermarkets.

Examples : Big Basket, Grofers, Amazon Pantry, Flipkart Grocery and Nature’s Basket Table of Contents

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02 Challenges Table of Contents

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Inefficient supplychain management Shopping malls were closed due to which hypermarkets with higher inventory levels have been affected.

Effect of sales on IT products and consumer durables Sales of seasonal products like airconditioners have been severely affected, with the summer months clashing with the initial days of the pandemic.

Logistical issues Other significant challenges faced by product businesses during COVID-19 include lesser workforce, delivery delays due to logistical bottlenecks and negligible in-dining numbers.

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03 Benefits

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Steady High-Volume business A viable grocery strategy initially entails being a low-margin, low-price highvolume operator and then if successful, evolving into a more conventional retailer offering more services with higher operating costs, margins and higher prices.

Essentials not requiring a sales push Grocery stores generally sell essential items for everyday use.With no window shopping done by potential buyers, little or no sales push is required. All these lead to low startup and overhead costs.

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Online Advantage After the online revolution, internet is now easily available and m-commerce is widespread. With work-from-home becoming popular during COVID-19, online grocery shopping has become the norm and an absolute must in every buyer’s to-do list.

Digital Groceries – Easy to set up Instead of a physical store, a warehouse and reliable suppliers are required for a digital grocery. Retail consultants can also serve as useful guides facilitating the entire startup process.

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04 Opportunities

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1. Fluid and Safe Formats embracing the new normal Retail grocery formats should be easily adaptable, focusing on consumer needs and preferences.

Reallocation of space, downsizing of stores and developing new formats would become the order of the day. Strictly adhering to hygienic sanitization and disinfection practices, social distancing and re-evaluating how people check out and pay by offering self-checkout kiosks and touchless technology will also be in vogue.

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2. Making your Business Model Tech Enabled and Future Proof Business models have to be rejigged and made more agile.

Stores could be cashless or virtually cashless, with replenishment processes automated. Machine learning could also be used to forecast supply chain anomalies.

Other technology enablers could be implemented in merchandising, e-commerce, and the remote digital office workplace.

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3. Shift from Mass to Targeted Digital Promotions In order to handle sudden demand changes, targeted promotions tailor-made for online channels and considering specific consumer preferences will be more popular.

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4. Innovations in the COVID19 context – ‘Contactless groceries’ The concept of ‘ghost kitchens’ could spawn the growth of ‘contactless groceries’, i.e. stores that are contactless pick-up and delivery hubs without letting in customers inside. 30-minute deliveries will also become widely prevalent, with drone deliveries taking care of the ‘disease safety’ aspect.

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5. Unique Customer (Shopping) Experience fortified by AI Online groceries would harness the power of AI to personalize the entire customer experience journey.

Whether it is the answering of routine questions or store checkouts through chatbots, everything will be AI-automated. This would pave the way for more meaningful human interactions, say for complex issues or getting customized product recommendations, thereby striking an optimal balance between the two.

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SUMMARY MISSION STATEMENT Your Retail Coach Omnichannel grocery retailing promising a consistent, seamless shopping experience is here to stay. Now and in the future, brick & mortar stores will continue to coexist with digital groceries, as buyers will still crave for a personalized face-toface shopping experience, trying out new apparel and ‘touch and feel’ for expensive electronics. As a result, food and beverages, electronics, health and personal care, and general merchandising products will continue to show promising sales.

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SUMMARY MISSION STATEMENT Your Retail Coach Groceries will remain profitable, as long as relevant market research is undertaken to provide a granular view of the local market, employees and customers are protected, and a stable continuity plan and infrastructure maintained. Supply chains also should be diversified to build resilience against shortages, and effective digital marketing strategies embraced, to add more value than ever before.

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To know more about "Grocery Business", visit: https://www.yourretailcoach.in/digital-transformation-in-retail-industry/ For India & South Asia: https://www.yourretailcoach.in/ For Dubai & Middle East: https://www.yourretailcoach.ae/ For Africa: https://www.yourretailcoach.africa/ Business Process Xperts: https://www.businessprocessxperts.com/