Today, inflation has hit the highest level in 10 years. And with consumers noting price rises across fast fashion, fuel and food, today’s figures will no doubt add to the woe of the hard hit retail sector.
In the midst of peak shopping season, it’s another huge blow for retailers already facing off major challenges of supply chain challenges and labour shortages. These harsh market conditions and the change in customer expectations – with retailers forced to invest to keep pace with the rise in digital behaviours – have all posed major challenges to the sector.
For retailers, inflation represents another hurdle in a long list of recent volatilities. The most sophisticated retailers are listening to their consumers and using the best analytics, strategies and AI platforms to find that delicate balance between supply and demand in a rapidly evolving retail landscape. One of the ways that many retailers in the UK have improved their position in the market is through a greater focus on local and ‘Made in Britain’ products. Not only has this helped with supply chain issues and sustainability messaging, but it has also led to some increased demand.
A regional and localised approach is also important. Inflation, consumer demand patterns and supply chain challenges are not the same across all regions and all channels. What is right for an online shopper in Brighton may not be optimal for an in-store shopper in Liverpool – and yet, some UK grocers still use a simple solution to a complex problem.