eCommonSense Comment: Q1 2020

Andy Scothern, Managing Director eCommonSense is BMBI Expert for Website & Product Data Management Solutions

The far-reaching effects of the coronavirus pandemic will have lasting impacts on all sectors of the economy, including builders’ merchants and their suppliers. Those not planning for the permanent changes in buyer behaviour will be at a significant disadvantage, or worse.

The builders’ merchant sector was already undergoing massive structural changes due to the changing demographics of the UK workforce and increasing digitalisation. The coronavirus pandemic is accelerating that transformation, with online trade predicted to increase from around 3% to 20% by the end of 2020.

Continuing to trade while keeping employees and customers safe has persuaded many builders and DIYers to find other ways to order building products, which are delivered without them needing to go into the stores.

Merchants with integrated websites that include merchant services and organised product data are experiencing record-breaking online sales. Some have seen their website become the highest revenue generating part of their business overnight. Merchants without a fit for purpose digital platform, are having the opposite experience. Phone lines are unable to cope with high call volumes, while sales are lost as customers find merchants with a better online service.

Retail is already undergoing profound changes, and Covid-19 is accelerating these trends. In response, many retailers and merchants are revisiting their digital strategy and investments to provide customers with a compelling omnichannel experience.

Thomas O’Connor, a senior analyst at Gartner, said: demand is shifting from physical stores to the online channel as consumers avoid public places under government restrictions on the movement of citizens. Many retailers are laying off staff as sales volumes decline, while the retail giant Amazon has launched a recruitment drive to hire an additional 100,000 staff in its fulfilment centres.

With their customers looking for frictionless ways to buy online, Builders’ merchants need to secure their future. But it won’t be one thing or another: creating a genuinely compelling omnichannel experience will be key to merchants’ success.

Things will never return to the old normal, so business models will need to adapt quickly to the new normal.

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Launched in 2015, the award winning monthly Builders Merchant Building Index (BMBI) report is the only reliable measure of repair, maintenance & improvement (RMI) activity in the UK. Filling an important gap, it can be widely used in construction, and by economists, Government, national media, commentators and influencers outside the industry.

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