We explore which sectors will be most challenged by the COVID-19 pandemic, and it was apparent from our Interviews that those involving leisure would be among the worst performers. One example of a suffering subsector is gym operators: in addition to revenue drying up from frozen direct debits, customers may potentially downgrade from premium and mid-tier operators to budget brands. Meanwhile, the casual dining industry could also be in trouble, with an estimated 50-80% drop in revenue for US casual and fast casual dining operators, depending on their takeaway business size.
Consumer staples and grocery retail are among those recording a better performance, however. In what one specialist dubbed “revenge of the processed foods”, people are buying canned products for the first time, with categories such as frozen food and pasta also being stripped from shelves. Hygiene products, like hand sanitiser, disinfectant wipes, antiseptic surface cleaners, toilet paper and tissues, are also clear winners. And with people spending more time at home, there was a surge in demand initially for certain electrical appliances, such as soup and bread makers.
How sectors could mitigate the damages wrought by revenue shortfalls was also discussed, including the potential for renegotiating rent. One specialist notes that the larger, commercial landlords tend to be more supportive. Meanwhile, a range of aspects to take into consideration during the recovery, and how these would affect businesses, were examined. These range from long-term social distancing regulations to supply-chain disruption. Finally, we take a look at potential long-term changes to the consumer landscape, including shifting consumer habits and higher e-commerce uptake.
Click here to access all the insights from the consumer-related coronavirus Forum Interviews in Sector Spotlight: COVID-19 – Implications for the global consumer landscape.
The information used in compiling this document has been obtained by Third Bridge from experts participating in Forum Interviews. Third Bridge does not warrant the accuracy of the information and has not independently verified it. It should not be regarded as a trade recommendation or form the basis of any investment decision.
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