Online retailers concerned in run-up to Christmas

93% of online retailers in the UK are concerned about labour shortage and supply chain issues affecting the upcoming Christmas season while 88% had to alter their key growth markets

  • Nationwide representative B2B survey reveals that only 7% of UK online retailers are not concerned about labour shortage and supply chain issues ahead of the Christmas season and early 2022
  • 73% of the UK online retailers have already increased prices over the past 12 weeks due to rising costs as a result of the feared energy crisis and supply chain issues, while another 22% have plans to do so shortly. 
  • 63% of the UK online retailers believe that a winter of discontent such as empty shelves and delayed delivery due to HGV driver shortage and the global supply chain issues will hit the UK shoppers harder than forecasted until now
  • 88% of the surveyed online retailers had to alter their key growth markets as a result of recent events, with the most popular areas now being Germany followed by France
  • 31% of British online retailers said they have already started hiring additional staff (between 11-25 people) 
  • 86% of retailers state they are concerned over labour shortage and supply chain issues affecting them beyond early 2022, however 84% also said they were optimistic about what lies ahead in 2022. 

 Scurri, the software provider that connects and optimises the eCommerce ordering, shipping, and delivery process has released the results of its nationwide representative B2B survey among 350 retailers across the entire UK. The findings reveal the level of key concern felt by retailers leading up to the festive season. The study also looked at how supply chain complications have caused changes in online retailers’ key growth markets and their feelings going into the New Year (2022). 

“Supply chain disruption is at a crisis point. HGV driver and CO2 shortages, inflated shipping costs and commodities prices, sustainability issues, financial strains and greater ESG regulations for sourcing and manufacturing goods are just some of the many challenges retailers are facing. As we approach one of the busiest shopping periods of the year, it’s therefore critical for retailers to reflect on how they can respond to their concerns through their own campaigns and strategies. Retailers have no choice but to turn this disruption on its head by kickstarting Christmas marketing earlier than usual to keep customers happy”, says Rory O’Connor, founder and CEO of Scurri. 

HGV driver and staffing shortages at a crisis point, Northern Ireland Protocol and resulting complications among main retailers’ concerns

With more than 9 out of 10 online retailers saying they are concerned or very concerned (93%) about labour shortage and supply chain issues ahead of the Christmas season, only as little as 7% of retailers say they are not really concerned.

The greatest cause of supply chain issues during this time are felt to be driver and staffing shortages (22%), the Northern Ireland Protocol and resulting complications (21%), China’s factory slowdown (20%), continuing COVID-19 complications (19%) and Brexit (17%). 

As a result, many retailers are experiencing consequences in the form of half-empty shelves in their stores and major shortages. In addition, retailers are concerned about the golden quarter, saying pent-up shipping demand will continue to impact product availability. 

“Add inflated shipping costs and commodities into the mix – alongside the possibility of greater environmental, social and governance regulations for sourcing and manufacturing goods – and it is clear retailers face great turbulence”, adds Rory O’Connor. “The only way to get out of firefight mode is to really accelerate digital transformation and improve supply chain visibility. Putting data at the heart of supply chain resilience allows a company to orchestrate disruption and constraints of the supply and demand.”

Increased prices and additional hiring of staff before the shopping bonanza will start

Additionally, in order to combat these shortages and worries, online retailers have hiked up their prices, with only 4% of retailers having no plans to change them. Over 95% of online retailers have or will increase their prices – 73% having already increased their prices and 22% not yet having increased their prices but with plans to do so shortly.

Additionally, retailers are planning to hire more temporary staff this year than previously to ensure the stocking of shelves and a smoother flow of operations. Only 2% of retailers said that they did not have plans to hire any additional staff, while almost three quarters of retailers have already begun this hiring process (74%). 

Looking to the future – shifting of priorities for online retailers

When it comes to looking to the future, UK online retailers are confident about what is in store for 2022. While concerns regarding the supply chain and resulting complications may still prevail, 84% say that they are optimistic about the new year. Things have changed however, and priorities for online retailers have shifted:

  • 46% of retailers said advancing their sustainability agenda to reduce impact on the planet is their priority. The majority of British consumers pay attention to the sustainability and environmental efforts of retail brands, with customers searching for more sustainable retail brands online.
  • Other top priorities include investing in digital retail technology (46%), cross border expansion (44%), Covid-19 recovery and return to pre-covid levels of business (42%), as well as winning new business (41%).

Alteration of key growth markets

Additionally, 88% of the surveyed retailers (308 out of 350) had to alter their key growth markets as a result of recent events, with the most popular areas now being Germany (38%), followed by France (30%), Belgium (29%), The Netherlands (28%) and Ireland (27%). For those retailers who did not alter their key markets, the most popular regions that they continue to focus on are much the same as retailers who refocused, including Germany (33%), Switzerland (33%), The Netherlands (29%), France (29%) and Ireland (26%). 

While the strong majority of online retailers remain optimistic for the coming year, there are still worries. 86% of retailers state they are concerned over labour shortage and supply chain issues affecting beyond early 2022. Overall it is fair to say that when looking past this busy retail season and into the near future, there is a sense of cautious optimism by retailers. 

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