25 Mar 2023 00:00:00 AM Breaking News
UAE: Public holidays announced for National Day, Commemoration DayCoronavirus: UAE reports 1,491 Covid-19 cases, 1,826 recoveries, no deathsUAE health alert: Can you cope with masks for long hours? Should mask breaks be introduced?Breaking: UAE lifts all movement restrictionsLife after COVID-19: Retail Industry witnesses shift towards e-commerce globallyCOVID-19 impact: Yes, it’s time for Dubai business to restartCOVID-19 response: DIFC to gradually reopen businesses from WednesdayCOVID-19 response: DIFC to gradually reopen businesses from WednesdayDubai 22K gold price touches Dh200 a gram for first time in nine yearsCoronavirus: UAE announces 624 new cases, 11 deathsCOVID-19: UAE announces 462 new casesCoronavirus: UAE announces 549 new cases, 9 deathsSmall group of employees behind fraud at NMC Health, says B.R. ShettyCOVID 19: UAE announces 4 deaths, 518 new coronavirus cases and 91 recoveriesUAE announces 490 new coronavirus cases, three deathsCoronavirus: UAE announces 432 new Covid-19 cases on WednesdayCovid-19: UAE announces 300 new cases of coronavirusCOVID-19: Disinfection drive extended to 24 hours in DubaiUAE announces recovery of two new coronavirus patientsPanasonic CEO vows to ‘eradicate’ money-losing businessesEmirates to carry over 6,500 passengers to Dubai for Amway’s largest leadership gatheringTrading of Emirates NBD Bank’s rights issue to take place this NovemberSelling pressure on Emaar drags DFM 1.3% lowerEmirates NBD hires Standard Chartered's Patrick Sullivan as CFOWorld Bank chief asks India to reform financial sectorEarly settlement charges on home loans in UAE reducedBreast Cancer Awareness: How to do a self-exam and why it is a mustDFM surges 4.8 percentageas Emirates NBD hikes foreign stakes limitMcDonald’s enlists Alexa and Google to help with its hiring84-year-old Indian man goes skydiving in DubaiUAE in Space: Have questions for Hazza on the ISS?Indian minister seeks direct flight between Bhubaneswar and DubaiExpo 2020 dome now complete, marking new milestone for UAEEmirati astronaut Hazza Al Mansouri undergoes final test as lift-off nearsSoftBank triples net profit in Q1Microsoft 'listens' to conversations, but only with permissionChina warns India of ‘reverse sanctions’ if Huawei is blockedStocks, oil edge higher as trade-war panic easesTens of thousands losing jobs as India's auto crisis deepensSerena again tops Forbes list of highest-paid sports womenDubai equity traders get a reason to cash out ahead of holidaysRight time to invest? UAE equities attractive on low valuations, positive indicatorsIndian rupee hits 19.21 vs UAE dirhamHumid and dusty weather in UAE until Eid weekendHeathrow airport strike: Emirates issues travel advisoryEid Al Adha 2019: Four-day holiday in UAEEid Al Adha to be celebrated on August 11 in UAENissan, Renault eye restructuring for Fiat merger: report Nissan controls 15 per cent and has no voting rights in Renault

Life after COVID-19: Retail Industry witnesses shift towards e-commerce globally

A report by Dubai Future Foundation foresees the future of retail post COVID-19

Duba: Online retailers and e-commerce platforms experiencing drastic growth as consumers avoid shopping malls in response to COVID-19, according to a new report‘Life After COVID-19: Retail’ by Dubai Future Foundation (DFF).

The report, launched within the Foundation’s ‘Life after COVID-19’ series and includes eight reports to date, tackles the different challenges and opportunities that the UAE and the Arab world will face in the aftermath of the global health crisis.

The report acknowledges the need for shutting down malls in the UAE from March 25 to April 25 amid the global health challenges to protect the general public’s health and safety, and to lessen the spread of the virus. Similar measures have been taken throughout the MENA region. Due to the digital infrastructure that Dubai and the UAE offer, an abundance of online retailers delivered throughout the country to a digitally enabled population, most of which, uses the internet, according to the jointly issued report by Visa Middle East and The Department of Economic Development (DED).

Online on the rise

The report highlighted examples where online sales are on the rise. Dubai-based Majid Al Futtaim (MAF), which operates 24 shopping malls, such as Mall of the Emirates, has seen a surge in online sales, with a 59 per cent year-on-year increase in online customers in March 2020. Saudi Arabian retailer BinDawood Holding has seen a 200 percent increase in its online sales since the escalation of the COVID-19 crisis.

Report findings reveal that shifting businesses online requires significant investment from brick-and-mortar retailers facing a cash crunch. However, retailers can be spared such expenditures should existing and new e-commerce platforms provide access to their platforms for their products. Dubai-based real estate company Emaar, for example, has set-up a simulated Dubai Mall on noon.com for customers to shop virtually at many of the mall’s well-known stores.

Global trend

The report discusses the forced closure of brick-and-mortar retailers globally, as a result of COVID19, with consumers switching to online shopping. Moreover, it addresses the effects that the pandemic has had in the United States. To date, nearly 630,000 outlets have been forced to close and it is unclear how many of them will reopen. According to The Financial Times, UK clothing retailers – Debenhams and Oasis – have entered administration in recent weeks, and many in the industry are expected to experience more financial distress after lockdown than during it.

On the other hand, some e-commerce retailers are on a hiring spree. According to a recent article by Thomson Reuters, Amazon, the American multinational conglomerate technology company, has hired 175,000 employees to cope with the demand. Instacart, a North American grocery delivery and pick-up service, announced hiring 300,000 full-service shoppers in March, and a month later it announced plans to hire an additional 250,000 to meet increasing customer demand for online grocery delivery and pickup in the USA and Canada.

New opportunities

The shift to online shopping has created tremendous opportunities for e-commerce retailers and the logistics and delivery services that cater to them. However, it is not yet at a level playing field, and a significant number of retailers remain offline. In turn, this creates an opportunity for governments to ensure that smaller retailers with limited online presence are not left behind by providing an e-commerce platform for them.

In the short-term, the report indicates banks should restructure maturing loans in the retail sector, providing a lifeline to an industry suffering with low revenues. Waived rents to retail tenants could be offered during lockdown, provided by shopping mall landlords. Employees can be reshuffled and reskilled, allowing growing sectors to manage the surge in demand, and preparing employees for new roles.

Back to malls

In the long-term, it is estimated that shoppers will return to the malls, though not at the same levels as before, with online habits having become more routine. The report suggests introducing tax-free shopping at malls to encourage shoppers to return. Shopping malls could also benefit from being certified as ‘COVID19-Free’ by relevant authorities and can further be maintained by testing every visitor prior to entering. Lastly, the increased popularity of touchless shopping experiences can be catered to with self-checkouts, and the avoidance of touchscreens.