Regional Insights from UK & Europe, February 2021
This month we hear from Kea’s UK & Europe Regional Director, Sara Fogarty, who shares her insights into the market trends she’s seeing.
January 2021 hit hard. Although the grey days are getting longer and a flush of snow has brought some joy, we are all feeling the effects of Covid-19 groundhog days/weeks/months/quarters. Stronger measures imposed by Governments around UK & Europe have seen retail and hospitality sectors closed (except for some takeaways and home deliveries). Schools remain closed to all but essential worker children, and parents are not only juggling their own virtual schedules, but those of their children. Work days are longer, where we have no commuting time, this has been replaced with more ‘e-meetings’. Parents are playing catch up on either side of the day with missed hours trying to navigate and fulfil their small people’s needs.
We now have an established habit of buying online and direct from producers. We dearly miss the ability and option of browsing in stores and aisles, discovering new products, range extensions, and seasonal offerings. Digital presence and cut through is paramount.
57% of consumers now order at least some items direct from producers – a trend that will remain beyond Covid-19. “85 million parcels have been delivered direct to customers by manufacturers this year and that volume will grow almost 30% by 2023” Lee Collinson, Head of Manufacturing, Transport & Logistics, Barclays
D2C will remain key for many and having a clear strategy to support this, difficult whilst being so many miles away for Kiwi businesses, but vital if you want to drive revenue streams from this region with so many retail and wholesale options limited.
Supermarkets continue to see steady growth. Specialist online retail is also increasing at around 34%, with food and drink retailers enjoying a boost. Unsurprisingly travel has been hit, but some early bounce back with confidence of the vaccine rollout and look to summer holidays/staycations.
Brexit has also brought about much confusion and frustration around the country, and also for our exporters as everyone tries to get to grip with what new requirements, labelling and logistics changes there have been. Difficulty is emerging with movement of products to Europe from the UK and best ways to navigate this. Time for our exporters to be even closer to their markets and partners and they’re understanding that things will take time to resolve.
It may be appropriate for business operations to be reassessed, explore new opportunities, evaluate where you operate from and how you go to market. Focus on your end customer and who they are, what their buying journey is and try to understand what they are facing in their day to day lives. The reality of the deal means that yes Brexit negotiations are officially at an end, but the UK & EU will now be engaged in negotiations of one kind or another for some years to come across many sectors.
Its not surprising that the sentiment is of frustration here and there is no clear end in sight. Dates are swirling around of a ‘hope’ to a return to school and some easing of restrictions on the 8th March in the UK. A dangerous date given its International Women’s Day, there could be the wrath of all mothers!