The retail and hospitality industries are changing in big ways. We’re all aware of the worldwide move from high street retail to ecommerce, but this shift in favour of online consumerism is only in its infancy. In fact, according to Wolfgang Digital, online Irish consumers are expected to double their spend by 2021. This steep upward projection for ecommerce shouldn’t be a surprise to anyone, but there are some more nuanced trends we’ve noticed in the retail space that are worth keeping an eye on as well. Let’s take a close look at the top 4 trends to watch in retail and hospitality right now.
1. Simplifying complex systems for retail businesses
On the surface, running a restaurant or a shop might seem quite straightforward. No doubt, it is a challenging place to work with many time-sensitive demands and customers to keep happy, but it is not often considered an area that requires a complex infrastructure of systems. However, this is actually very much the case. Most restaurants and shops will have a Point of Sale (POS) system, a loyalty scheme, inventory, staff and accounts to keep track of and, unfortunately, often none of these areas communicate very well with each other.
The good news is there are many solutions out there that can simplify these complex systems and have them work harmoniously with one another. Xero is fantastic accounting software that works well within an ecosystem of systems, and this makes sense for retailers. There are also great new solutions coming through for cloud inventory management, cloud POS systems and cloud payments services. It is still a very young market, but everyone is seeking the same thing – an integrated solution set that works well together without costing the earth!
Ultimately, the only option is to rise with the tide of change or get left behind.
2. Reduced business costs with the cloud
This shift to the cloud is significantly reducing the cost of running a retail or hospitality business. For example, traditionally, a POS system could cost €15,000 – €20,000 for just one outlet, and most shops, restaurants and bars will need many more than that. It is a massive upfront investment and the product you get cannot be updated easily without more money being pumped in. But now, with the cloud, you can simply get an iPad and pay €20 a month for a cloud POS system. This immediately brings down the cost of setup, hardware and licencing while also giving you all the advantages of being in the cloud – such as usability, accessibility, security and extra functionality. The businesses that are going to survive and grow in the coming years will have streamlined processes that are lean and polished, which is exactly what the cloud is able to provide.
Xero is fantastic accounting software that works well within an ecosystem of systems, and this makes sense for retailers.
3. Retail and hospitality experience nurtures valuable transferable skills
With regard to customer service, expectations are high as convenience continues to reign king. Value-added services such as customer service chatbots, free returns, free delivery, next day delivery, free parcel tracking and 24-hour support do not delight consumers anymore. Instead, they are simply expected. In many cases, these expectations have been fostered by international online retailers and yet customers expect the same calibre of service not only from multi-national ecommerce companies, but from local shops and restaurants too. The upshot is that those who compete in this space recognise the necessity of training their employees to provide high-quality customer service.
As ecommerce grows and brick-and-mortar retailers diminish, these experienced service people will be reinventing themselves in the next few years with their goal being to enter other job markets. This is very interesting from our point of view because the result is a group of highly personable, hard-working and intelligent people making themselves available to industries that are crying out for these skills. We have direct experience of this at Beyond, as several individuals on our team originally worked in the retail industry, and it has been of great value to us. As technology has evolved, so too has our role as accountants and exceptional customer service is now, more than ever before, a vital aspect of our service. The same is true for all service providers competing in their industry, so we’d advise attracting this kind of top talent to your team.
4. Ecommerce means a change in how we think about retail
The great thing about ecommerce is that these days, with solutions such as Shopify and WooCommerce at your fingertips, it is easy to set up a website to sell goods and services. However, your website cannot exist in a vacuum. You have to drive traffic to it. This requires using the likes of Google Ads, Facebook Ads, Amazon sales and online listings. This is easier said than done if you are a retailer who is trying to make the move from brick-and-mortar to ecommerce or even if you are simply trying to grow your online business but find it difficult to keep up with the constantly shifting world of online advertising.
As ecommerce continues to grow and Irish SMEs are put in direct competition with large international companies, it will no longer be enough to throw up a website and an ad campaign and hope for the best. Instead, as a business owner, you have to get seriously savvy about the online business landscape. This competitive digital marketplace, with its bidding auctions and cost-per-click charges, often does not adhere to the traditional retail wisdom regarding business planning and cost-plus pricing. Ultimately, the only option is to rise with the tide of change or get left behind.
The real takeaway here is that retail has completely turned on its head, which for businesses means that there are equal amounts of threats to tackle as well and opportunities to take advantage of. There is no doubt that technology is what’s driving this change, but it’s also the very thing that will help you keep up with it.
Xero cloud accounting is one example of an exceptional product leading the way in this space because it is so easy to use and flexible. It is a very open product, making it easy to connect via API and seamlessly integrating with 700 different applications. If your retail business is starting to get more complicated than you would like, it might be time to consider a solution such as Xero to simplify things so you can get back to focusing on what you do best.