COVID-19 pandemic highly affects ecommerce industry, study shows

Friday 20 March 2020 08:14 CET | News

An Ecommerce Europe survey has revealed the impact of the Coronavirus outbreak on ecommerce in Europe, reporting that the current pandemic is already affecting online retail.

According to the survey, 65% of the respondents indicated that they or their members (online merchants) expect the pandemic to lead to a decline in sales and a release of staff. This decline of sales can already be seen in sectors such as fashion, travel and other service-based sectors. In contrast, industries such as food, healthcare products, products contributing to working from home (laptops, tablets, screens etc.) and being quarantined (freezers, etc.) have seen a steep increase in sales.

As a result of the focus on ecommerce in these growth sectors, some certain effects of the crisis on online retail are already visible. While 94% of respondents indicate that it is still possible to sell and deliver products in their own country and cross-border, members did stress that there are sometimes some practical problems depending on where online shops are selling to, for instance at the border, or which products they are selling. While delivery is thus still generally possible, between 55% and 60% of the responding members is currently dealing or expects to deal with delivery delays in the future.

Around 65% of the companies and national associations currently expects a partial or complete closure of their business or that of their members during quarantine. This is also linked to whether or not a Member State is in a far-reaching lockdown. For instance, in Italy, where the outbreak in Europe first hit, the closure of activities was declared already on 13 March, leading to strict restrictions to limit the movement of people. All trade and production activities that are not strictly necessary or not connected to the food and health case supply-chain were closed. Despite this, online shops (selling all kinds of products) continue to operate. To achieve this, workers inside the warehouses are adopting very serious prevention measures. In the logistics sector, there are many difficulties. As people are only leaving their homes if strictly necessary, there has been an exponential increase in the demand for logistics services. Especially couriers for ecommerce and food deliveries are no longer able to keep up with the demand, leading to many delays and cancellations of deliveries.

The situation in Italy gives an indication of what countries going into full lockdown could expect. In this perspective, notwithstanding the importance of ensuring that citizens do not spread the virus across Europe, it is imperative to keep the borders open to allow necessary cross-border product supplies and sales. Moreover, in instances of far-reaching lockdowns, the dependency on online retail becomes significant. Delivery operators and online retailers, especially SMEs, are going to need support from governments and authorities to fulfill this important function.

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Keywords: Ecommerce Europe, survey, COVID-19, retail, online merchants
Categories: Payments & Commerce
Countries: Europe
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