Executive Summary: Retail Lessons from Spain

Facing one of the greatest medical, cultural, and economic challenges of our lifetimes, our response to the current COVID-19 pandemic will have both an immediate and long-lasting influence on our communities, our businesses, and our personal and professional interests. Right now, we are making critically important decisions that will directly impact the outcome, and it’s essential that we get it right. This requires making informed decisions, using the best and most useful information at our disposal to choose a course of action that is both beneficial and responsible.

Currently, one of the best ways to accomplish this is to gauge the responses of other countries that are a few weeks deeper into the current pandemic to see how they’ve responded, and how those decisions have impacted the outcomes. Learning lessons from their decisions and how the retail community is currently dealing with the outbreak can help put us on a more successful path as we move forward.

To help us gain better insights, LP Magazine began this journey by speaking with our colleagues in Spain. Spain currently has the fourth largest number of confirmed cases of COVID-19 behind only China, Italy, and the US. With the impact to Spanish retailers starting several weeks prior to what we are currently facing here in the US, their response can provide North American asset protection and operations professionals valuable insights into how the pandemic has affected their stores and customers.

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Todd Hooper
Todd Hooper

With the generous support of our partners at ALTO, LP Magazine held a webinar discussion with ALTO Country Manager Todd Hooper, speaking to us directly from Madrid, Spain. Hooper is an experienced retail professional helping companies analyze and act on integrated data to achieve better results. Recently he was senior vice president of operations for Correos where he was the driving force behind the reinvention of the Spanish Post Office. Prior to that he was vice president of private label brands in Spain for European supermarket retailer Carrefour. As country manager for ALTO Spain he manages data integration, analytics, and operational actions for multiple Spanish retailers.

Hooper offered a first-hand account of how the response has unfolded in Spain, along with some suggestions for improving the US response in the days and weeks ahead. Among the topics discussed:

The entire country is on some form of lockdown. Non-essential businesses are closed, and given that retailers in Spain are dealing with the most advanced impact of the pandemic, their experience can provide guidance for markets that will likely reach this level soon

Companies are making hard decisions very quickly. Retailers have made swift decisions with unprecedented speed, as some shut down immediately at the first exposure to infection. These decisions are believed to have greatly reduced the spread of the virus.

Grocery sales are 70 percent higher than usual, though stores struggle to operate profitably due to extreme operating conditions. Retailers are strictly controlling the number of customers that are entering the stores.

Social distancing is strictly enforced and additional efforts are being made to control social behavior, to include police intervention and substantial fines for those that fail to follow these mandates.

Despite diligent efforts, supply chain disruptions are still significant. Suppliers are increasing production, but due to the extraordinary conditions, retailers say that they are receiving the wrong products and logistics have been unreliable.

Shrink from theft is high, with petty theft in categories like alcohol and various staple products. Significant internal theft is taking place, especially involving goods such as hard-to-find necessities.

Limiting exposure is the top priority for essential retail stores, forcing new customer service procedures and business model changes. Retailers are stepping up cleaning efforts, creating additional exclusive opening hours for high-risk customers, increasing delivery and curb-side pick-ups, re-merchandising departments to better manage traffic and handling concerns just to mention a few measures that are being taken.

Following the presentation Hooper also took a number of questions from the webinar audience, commenting on topics from e-commerce to the absolute necessity of acting responsibly and taking the current situation serious.

All of us are living through a time that will undoubtably change the way we live, the way we work, and the way that we shop. Only by learning the lessons of all of those around us will we find the answers that all of us want and need in the current environment. We then must apply those lessons in a way that implies both urgency and responsibility, showing the discipline to listen, speak, and act with integrity and a positive outlook for what we can accomplish as a result.

To learn these lessons first-hand, go to “COVID-19 Impact: Retail Lessons from Spain” to watch the webinar in its entirety, or listen to the podcast here.

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