“Nobody can deny that throughout the value chain the initial shockwave and concomitant aftershock of Covid-19 and the global lockdown was akin to a deer caught in the headlights,” he adds.

But what seems like a paralysing surprise at first is likely just an acceleration of what was to come, notes Nichas. “The way we do business has been fundamentally flipped in a really short time, and it’s the decisions and new momentum during this period that will determine survival. Difficulty can tap unexpected strengths in us all.

With a looming global recession on the heels of the pandemic on top of the step-change, “the next while will be a litmus test of determination and innovation,” he says.

10 key industry shifts

Nichas believes that there are ten ways in which the retail and related food and beverage industry will fundamentally shift.

1. Last-mile economics will no longer be the domain of large online retailers. From restaurants through to boutiques, grocery stores and department stores must plan now to create and implement delivery services and a significant online retail presence.

2. Concomitant to an accelerated digital revolution in the middle- to upper-income sectors, so we may see the evolution in retail accelerate. Floor space may very well shrink and generalist department stores will likely see a trend continuation and either change the way they do business or disappear altogether. Think Garlicks, Stuttafords, Greatermans and John Orr’s that have all disappeared in the past two decades already. Boutiques and specialist or bespoke retail with a smaller footprint and lower overall overheads with business agility will likely see a comeback.

3. It will be a tenant’s market. With a significant supply in retail space in South Africa coupled with an instant contraction forced by circumstance, high rentals and an ivory tower landlord perspective will leave a lot of empty spaces in months and years to come unless conversations are had now about saving both sides of the tenant-landlord value chain.

4. Supply chain and origin of goods will become important not only for consumers as an act of conscience and perhaps a newly embedded fear, but localised sourcing and manufacturing or widening a supply chain may become critical for business continuity just in case a similar threat to Covid-19 lies in the near to medium-term future.

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