Quarterly Trends Report

Q1 2020: How supermarkets are digesting the COVID-19 shock

  • Multi Asset
  • Consumer
  • Global

Supermarkets around the world have been swept off their feet as customers filled their trolleys to the brim in anticipation of lockdown measures. And with no clear end in sight, some erratic behaviours are still being observed. Sales are up because of COVID-19, but there is a bigger picture to consider. Third Bridge Forum spoke to a number of executives to gauge their views on the situation.

It’s too early to assess the full financial impact of COVID-19 on supermarkets, but the disruption caused is plain to see: shelves empty only seconds after being restocked and long queues to get into stores and pay. It has been, and continues to be, chaotic to say the least — and behind the scenes is no different. 

COVID-19 is having a material impact on business operations, disrupting supply chains, influencing customer behaviours and stretching workforces. UK-headquartered Tesco estimated that the impact on its retail cost line will be circa GBP 650m-925m — depending on the scenario — and cited significant cost increases in payroll, distribution and store expenses. But while supermarkets share the same fundamental building blocks, no two business models are identical. Although each player is encountering its own challenges — and relative opportunities — some common themes have emerged in Interviews with industry experts.

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