Paper on impact of covid on retail sector in India

Abstract

The composite effects of COVID 19 would be that of the league of oil price shocks in 1970s. We can definitely see a large demand shock due to lockdown at such a large scale. The behavioral effect would be that people will defect from their original ways of spending. It can be reasonably predicted that there will be deviation for sure. One side effect would also be in the form of negative supply effect on oil prices due to weak oil demand. The supply shocks will be minimal as soon as businesses find ways to live with the COVID-19 and adjust using creative methods of selling themselves. Like redesigning the workplace with inclusion of more private offices to provide for social distancing, providing emotional support to employees, adjusting for lack of househelps, and lastly, developing an agile working environment for the operations. Mckinsey identified five qualities a business should have to turn around a business during covid and they are: resolve, resilience, return, reimagination, and reform. As we moved through covid, some businesses flourished, others perished. More than 22 crore UPI transactions were recorded within the country during 2020-21 as the entire nation was in the grip of covid. While the hotel industry saw a large lack in business due to absence of movement throughout the country. But despite the slowdown, the economy is expected to rise at 9.5% in 2021-22 and 8.5% in 2022-23. Driven up by high disposable income, rising urbanisation, increased digital connectivity, the economy is expected to show good spend in consumption. This is despite the online and offline models of businesses being employed. Retail growth in metro cities is exploding at a high rate. The firms like ABFRL and retailer Shopper Stop are engaging in omnichannel solutions where the goods are provided through different media, with this system getting encouraged during covid. The exhaustive network on Kirana stores, with the rising collaboration with Kiranas and firms like Reliance are also an encouraging sight to see. The current retail sector is abuzz with positive sentiments such as Reliance’s bid to engage with Kiranas and building a network of 5 million+ by 2023. Due to the new work from home culture, new trends are emerging such as rise in demand for comfortable clothing. International brands like Shein from China are trying to make inroads to India, viewing this positive sentiment in the public. Consumer confidence is going to be high in the third quarter of 2021, viewing the strong and merry holiday season.