In its daily update on COVID-19, the World Health Organization said it was “encouraged” by lower rates of new infections in Italy and a stabilisation in mortality in Spain. Regional director Hans Kluge said this may indicate peaks will soon be reached in some countries, although he cautioned it was too soon to say whether the worst had passed.
France: Leading operators are continuing to play a key role in helping consumers and the authorities through the crisis, and today concerns of agricultural suppliers are being addressed. Fresh produce has been among the hardest-hit categories and leading French retailers are now unilaterally seeking to promote homegrown fruit and vegetables to ease supplier pain points, with some, like Leclerc, making much of their replacing foreign-sourced lines with local assortments.
Germany: Consumer confidence has unsurprisingly fallen in the past month by 5.6pp to 2.7 for April, according to GfK. This is the lowest since the 2008 financial crisis, when it reached 2.6 in May 2009. Job insecurity is the chief cause, causing a falloff in discretionary spend despite food sales spiking 14% YoY in late February. Fears over employment are highlighted by a survey from trade body Handelsverband Deutschland showing 90% of all retailers expect to rely on state aid in the short-term. German retailers, meanwhile, are showing appreciation of workers’ efforts during the crisis, with Schwarz Group joining Rewe and others in rewarding employees.
UK: Shoppers appear to be coming to terms with new in-store realities, although debate today centred on those operators forced to go online, with unions questioning whether fashion pureplayers should be demanding staff to process orders in DCs. Retailers have pledged to work alongside government on initiatives to assist protection of those most at risk, while all leading retailers are now implementing new in-store procedures. The drastic impacts across distribution have thrown up some intriguing new alliances, with Sainsbury’s at the fore, teaming with food service wholesaler Brakes to fill its shelves.
Spain: Chiefly active in Spain and the UK, mall group Intu faces a cash crunch after receiving only 29% of rent due this year, heaping further pressure on already pressured shopping centre sector. A key occupant of many Spanish malls, El Corte Inglés, has become the latest retailer to file an ERTE to protect 25,000 workers.
Italy: The country’s suppliers are joining forces to ensure supermarket shelves continue to be stocked. Leading manufacturer association Federalimentare claims 75% of all raw materials are produced in Italy and that sufficient imports of the remaining 25% are arriving to make up the shortfall. Scarcity is visible in some categories, but with retailer and manufacturers of all sizes working together, essentials should not run low.
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Rest of Europe
In Russia, the capital Moscow has imposed strict regulations on stores permitted to remain open, although holding off a total lockdown as yet. The leading retailer in Romania, Kaufland, is offering local suppliers shorter payment terms to secure their business and paying workers EUR1.7 million in bonuses. Panic-buying is causing problems in Sweden, with leading retailer ICA suspending online operations due to huge demand.
Rest of World:
The administrative confusion that derailed ecommerce in India seems to have lifted, with Flipkart back in business along with Amazon, which has said it will focus on essential items in a mirroring of its strategy seen elsewhere in the world.
Hear More: Podcast: What is the impact of COVID-19 on grocery and retail?
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