“We have spent time over the last three months scaling up our operations to be able to handle an increase in volume. We have found ways to be prepared for rapid increases in throughput,” Luke James, the director of supply chain at BoozeBud, told Inside Retail.
While bottle shops can remain open, James is anticipating an uptick in online orders of beer, wine and spirits over the coming days, similar to what happened during the lockdown last year.
“We expect the average basket size to increase for our new customers who are using the service for the first time, while our existing customers who are familiar with our speed of delivery and comfortable with our service performance will place smaller, more regular orders,” he said.
BoozeBud has reintroduced its contactless delivery service in lockdown-affected areas to support customers following the government’s advice to stay at home.
“We are ready for whatever is thrown at us and will respond rapidly and successfully to the changing environment,” James said.
Back to dark stores and social distancing
At Booktopia, the return to lockdown has also been fairly smooth from an operations standpoint.
“Everyone just got into the groove of a lockdown,” Tony Nash, Booktopia’s CEO, told Inside Retail.
“The distribution centre knows what they have to do in terms of social distancing, wearing masks, cleaning their workspace, etc, [and] the office staff are already set up for working from home. So all in all, it is a smooth transition for Booktopia.”
The implementation of new systems to handle remote working and increased order volumes in 2020 has also made things easier this time around for online craft beer specialist Beer Cartel.
“We had a management meeting over the weekend and had a game plan worked out by Sunday which we’re now executing,” Richard Kelsey, co-founder and director of Beer Cartel, told Inside Retail.
Similarly, Superdry is switching its Sydney store network back to dark stores or mini distribution centres.
“We have become well versed with these lockdowns now. We will implement the same processes as we have done previously, with our Ship From Store functionality pointing to these stores as a priority,” Antony Hampson, general manager of ANZ for Superdry, told Inside Retail.
“Staff will then be focused on ensuring the higher volume of online orders we receive are dispatched in a timely manner.”
Hampson plans to adjust Superdry’s promotional calendar to drive higher conversion through its online channels to mitigate the overall sales fallout that he expects to see during the lockdown period.
St Frock founder and CEO Sandradee Makejev is also adding an extra promotion and increasing her marketing spend over the next two weeks after learning in the last lockdown that staying connected with customers is the most important thing.
“A lot of people pulled back media spend,” Makejev told Inside Retail.
Not St Frock, an online women’s fashion brand based in Sydney: “Facebook is at the centre of our strategy.”
Continuing to advertise despite the drop in consumer sentiment last year was “the best thing we ever did,” she said. “When [our customer] came back she started shopping with us right away.”
Potential impact on the supply chain
But while many retailers have been able to switch on remote working, click-and-collect and contactless delivery relatively quickly, they remain wary about the potential impact of the lockdown on their supply chains.
“It doesn’t directly impact us, but our suppliers range from niche boutique distillers and craft breweries all the way up to major multinational organisations,” Boozebud’s Luke James said.
Depending on the length of the lockdown, smaller operators may not be able to maintain their same production levels “as they will be seeing less customers on their own premises, meaning they may not have as much desire to stay open and keep producing to the same levels,” he said.
“Keeping our range topped up with fresh product and supporting our smaller industry partners are the biggest things for us to focus on right now.”
The potential fallout from an infection in the warehouse is another area of concern.
“The greatest risk is if someone in our fulfillment team was to become unwell and then force both themselves and those around them to quarantine,” Kelsey said.
“We’ve currently got a backup team in place as well as access to casual warehouse labour to mitigate the challenge of this if anything was to happen, but it still is a challenge that we’re very cognisant of.”
But the longer the lockdown goes on, the more problems retailers will face.
“Supply chain disruptions may occur if this goes longer than six to eight weeks,” Nash said.
“Everyone is watching the daily updates to see if we are getting on top of it or if this is bigger than we thought. Let’s hope we are on the front foot.”
What retailers want from the NSW Government
For James, the uncertainty in the leadup to the lockdown announcement and the confusion around the rules have been some of the biggest challenges this time around.
“A lockdown felt somewhat inevitable and it does feel like it took us a while to get there. This indecision is the hardest part, particularly when you have teams setting meetings both internal and external to carry on with projects,” he said.
“Maintaining a good line of communication with the team around government announcements was somewhat difficult. We work in Sydney LGA, but we don’t all live there, so we can’t come into the office, but can we still move around? This kind of messaging was hard to interpret for our team.”
Going forward, James would like clear communication from the government around the criteria that need to be met to exit the lockdown.
“Make us aware so that we know what to aim for. There’s no [information around] what will keep us open or what will keep us closed. It impacts how we market, what messaging we send to people, what we do on-site,” he said.
He also called for greater support for the hospitality sector and small businesses.
“We really feel for our colleagues in hospitality who once again are bearing the brunt of it. The impact of lock down on small businesses is enormous and we just hope we can support them more through this time,” he said.