Thousands of merchants forced to digitize to survive
The Covid-19 crisis has caused a major change in the functioning of the business world, particularly in its digital dimension. More than two-thirds of merchants found themselves without activity due to a lack of digitization . It is considered that they have seen their annual turnover decrease by more than 30% . According to many specialists, a leap forward of several years has been made, whether in the implementation of teleworking or in the digitalization of business sales processes.
- What solutions have traders put in place to limit the losses of their business?
Double containment: an obstacle for thousands of traders
The confinement two (between) March to May, was terrible for the traders. Six out of ten merchants have lost more than 70% of their turnover. It is actually the reconfinement of November that has the most impact on their activity. Indeed, the end of the year period is a crucial moment for some businesses. These last two months sometimes represent more than a third of the turnover for the year.
The closure of shops means a stop to on-site sales : the only solution, online or take- out sales. However, some businesses were not ready to carry out this accelerated digital transition , and do not have the knowledge and the means necessary to carry it out. According to the government, only:
- 37% of VSEs and SMEs have a website
- 9% an online store
- One in two companies consider that they lack the time and budget to embark on a “digital transition” project, according to a study conducted by Ipsos on behalf of Facebook
In addition to a difficult digital transition , merchants are suffering from increased competition that continues to grow.
- There is international competition . The rest of Europe is not experiencing the same psychodrama as France. Indeed, abroad, some merchants are more prepared for this rapid digital transition. 70% of physical shops are digitized in our German neighbors.
- This crisis benefits the big web giant , GAFAM. They took advantage of the boom in telecommuting , e-commerce and digital entertainment to post record sales. The latter jumped 18% in the first quarter with a 31% increase in profit . Amazon is among the big winners with a turnover of 96 billion dollars in the months of June, July and August.
However, actions have been put in place to help traders and try to save them.
Traders can rely on aid from communities and the state .
At a national level , the government is offering 500 euros to craftsmen, traders and self-employed left out, so that they start an e-commerce strategy and avoid bankruptcies.
In addition, traders can take advantage of state-guaranteed loans (PGE). As of June 19, 458,000 VSEs have obtained a PGE , for a total amount granted of 42.3 billion euros . The retail sector is the main beneficiary of the system (25% of the amounts) and the one with the highest intensity of recourse (amount/added value).
Regionally , some cities grant a budget in the form of gift cards. In the city of Terrasion , a budget of €20,000 has been allocated, ie 2,000 €10 gift cards , which the fifty or so merchants taking part in the operation can in turn offer to their customers. These vouchers will even be usable in restaurants if they can open. Finally, there are plenty of free trainings that can help them become more efficient. They are given in the form of a “webinar” on the sites of the CCIs, service providers or support networks.
Finally, traders tried to solve the problem by adapting their production . One of the first reactions among traders was to adapt the products . Lockdown has given rise to new modes of supply and consumption. Some offer to vacuum pack their product in order to facilitate the work of certain customers who wish to stock up and do not want to go out for fear of being contaminated. Others use new raw materials that will allow their product to be kept longer. They can also bet on 4 digital solutions :
- Thanks to the creation of a website : The owner of a ready-to-wear shop located in the city center was one of the first to get started: ” I took advantage of the first confinement to create my virtual store. And, surprise, as soon as the deconfinement ended, online sales continued . Indeed, e-commerce is a major issue . Especially for consumers because orders are faster , more convenient thanks to the 24-hour accessibility of the site and comfortable since it saves customers a trip.
- By improving their communication : The challenge is to keep the link with their local customers. Most of them post messages on their doors. An effective way would be to create a Facebook or Instagram page of the store.
- Marketplace : Without an online store, you can still get started on virtual marketplaces . An application like Epicery allows food merchants and artisans to sell their products online. The user of the service enters his address and discovers all the merchants accessible around him.
- Click and collect :
The solution of ESCadrille Toulouse Junior Conseil to help merchants in the digitalization of their activity
ESCadrille Toulouse Junior Conseil , provides support for the digitization of local shops. In addition, we collaborate with the Petit Tou, the reference city guide in Toulouse . We are committed together to provide assistance to Toulouse merchants. The objective is to support our immediate environment. Aware of all the difficulties faced by merchants, ESCadrille has thought about a tailor-made support that makes it possible to meet the challenges of the moment while offering support towards long-term digitization.
This support includes different aspects that can be modulated according to the individual needs of each merchant .
• Initially, we propose a digital audit of the existing system : the objective being to assess the level of digitization, and the weaknesses that will have to be worked on. We will analyze the actions already implemented in terms of digital communication and sales processes.
• We will then be able to propose a digitalization strategy based on an audit of the existing system, documentary research and also an analysis of the competition. This will involve targeting the marketing tools best suited to the merchant’s needs.
• We can also guide you in finding the grants and aid you have access to during this period. We can also carry out, if necessary, an oral defense of our study with financial organizations.
• Finally, we can also carry out training on the digitization of the activity and on the various tools necessary for its transition.
So, if you are a merchant or know people who could need our support, do not hesitate to contact us. The ESCadrille team, with 43 years of work alongside merchants, will support you in your digitalization project .
Article written by MAXENCE RIVOIRE, 2021.