THE CHANGING NATURE OF THE GLOBAL

docx

School

Karachi Institute of Economics & Technology, Karachi (City Campus) *

*We aren’t endorsed by this school

Course

1110

Subject

Business

Date

Nov 24, 2024

Type

docx

Pages

Uploaded by CorporalHeatGazelle13

1 The Changing Nature of the Global Landscape in 2023 of Retailing sector in UK [Module name] [Student ID:] [Student name] [Date]

2 Introduction People have seen the global business environment experience significant changes throughout time due to a variety of factors (Ghauri et al., 2021). The landscape in which modern enterprises operate is more unpredictable and competitive than it has ever been. Numerous causes contribute to this, such as the influx of new global rivals, the impact of evolving consumer preferences on markets, and the ongoing advancement of technical solutions that place pressure on companies to satisfy their clientele. In addition, the UK retail industry is negotiating a challenging environment in 2023, much like its international rivals (Harper, 2023). Even if there are many obstacles, there are also many fascinating chances for those who can create and adapt. This literature review will evaluate all sides of the argument objectively and highlight the main points using relevant examples. Key Challenges and their Impact on Business The retail industry is experiencing a significant shift due to a number of factors, including the changing needs of consumers, technological improvements, supply chain disruptions, Brexit, and digital disruption ( Upadhyay et al., 2021). Traditional merchants are under pressure to change as a result of shifting consumer attitudes, demography, and purchasing patterns. These days, consumers place a higher importance on experiences and sustainability. The UK's retail is undergoing a radical makeover, with prominent trends influencing both the competitive dynamics of the market and customer behaviour. With over 50 million users by 2023, online marketplaces like Vinted and Depop are prime examples of the growing popularity of pre-owned clothes (Martos Crespí, 2021). These platforms, which have benefited from the desire for inexpensive and sustainable design due to the rise in environmentally concerned Gen Z and millennial consumers, are expected to contribute £18 billion to the valuation of the UK used clothing industry by 2026, according to a recent GlobalData analysis (Yoon and Kwon 2021). Concurrently, e-commerce has had a profound impact on the retail scene, making up more than 30% of all retail sales in the UK in 2023 and predicted to reach 40% by 2025 ( Vyas et al., 2023). Traditional merchants are forced to restructure and close their physical locations as a result of this exponential expansion. Well-known names like Debenhams and House of Fraser have folded due to shifting consumer preferences, while well-established companies like Marks & Spencer have had to close a significant number of stores in order to adjust to the changing retail landscape.

3 This change has an influence on consumer behaviour and preferences in addition to numbers. When it comes to non-essential commodities in particular, online marketplaces such as Vinted and Depop provide considerable pricing benefits over traditional merchants ( Borges, 2023). This pricing disparity would be made clear by a comparison chart that shows the average costs of popular apparel goods in both online and offline channels. Furthermore, convenience is crucial, as internet buying provides convenient browsing, home delivery, and accommodating return policies. This ease is a major motivator for customers, reinforcing the online advantage, especially when it comes to non-essential transactions. A deeper understanding of the processes at work in the changing retail landscape may be possible with the help of qualitative insights gleaned from a study investigating the reasons underlying customer preferences for online shopping in the non-essential goods category. Consumer buying habits are being impacted by economic uncertainties resulting from the global economic slump and the cost-of-living problem in the UK (Lapavitsas et al., 2023). Retailers' profit margins are being squeezed further as a result of cautious purchasing habits brought on by inflationary pressures and lower disposable incomes. The recent move by Primark to increase prices, which breaks a 14-year trend, is an example of the difficulties brought on by the present state of the economy (Ezkieta Mendiburu, 2023). Global events like as the COVID-19 pandemic and geopolitical conflicts have caused supply chain interruptions that have shown weaknesses in the purchase of commodities, transit delays, and demand fluctuations. This calls for a review of supply chain plans and the implementation of agile techniques in order to reduce risks and improve adaptability to unanticipated difficulties. Brexit, the United Kingdom's withdrawal from the European Union, has complicated and added uncertainty to trade relations for merchants (Ghauri and Ott, 2022). Tariffs, customs laws, and possible delays in cross-border transactions provide difficulties that call for supply chain managers to make strategic adjustments. To ensure smooth operations, major merchants such as Tesco and Sainsbury's have had to manage these new trade dynamics (Jones et al., 2020). For conventional shops, technological innovations like automation and the growth of artificial intelligence (AI) provide both benefits and difficulties. Although technology has the potential to improve consumer experiences, it also carries the possibility of job displacement, which makes training and technology adoption extremely important. In order to be competitive in a market

Your preview ends here

Eager to read complete document? Join bartleby learn and gain access to the full version

Access to all documents
Unlimited textbook solutions
24/7 expert homework help

4 that is changing quickly, retailers must strategically integrate technology while taking into account any possible risks related to the use of automation and artificial intelligence. Opportunities for Businesses Survival in the ever-changing retail industry of today depends on the skillful fusion of online and physical encounters, or omnichannel experiences (Zaki, M., 2019). Click-and-collect options, technologically customised in-store experiences, and loyalty schemes Creating a bridge between the digital and physical worlds is essential to increasing consumer interaction and building brand loyalty. John Lewis is a prime example in this area, having effectively connected its online platform with physical locations, providing order monitoring and in-store click-and-collect options to provide customers a seamless and improved shopping experience. Retailers are adopting innovation at the same time to remain ahead of the competitive industry. Technological innovations present promising prospects, such as personalised suggestions made by artificial intelligence, streamlined processes through automation, and improved in-store experiences through augmented reality. Tesco's use of AI-driven robots to choose online purchases is one example of how these technologies may increase productivity, which in turn raises consumer happiness (Nguyen et al., 2022). In the changing retail market, a compelling trend is the strategic focus on fostering community and values. Customers are more likely to choose brands that share their beliefs and encourage a feeling of community. Embracing social responsibility, ethical sourcing, and sustainability into corporate operations builds a strong brand identity and draws in and keeps repeat consumers. A notable example of values-driven branding is Lush, which emphasises plastic-free packaging and ethical sourcing while also having a vibrant online community. One of the key characteristics of the modern retail industry is the expansion of e-commerce, which offers businesses in the UK a significant potential. Retailers are improving their digital presence as a result of consumers' growing preference for the ease of online buying. It has cemented its dominance, accounting for more over 30% of all retail sales in 2023 and expected to rise to 40% by 2025 (Roper, 2023). A recent Barclaycard poll highlights this change, showing that 63% of UK shoppers rank convenience as the most important consideration when choosing a retailer (Dada, 2022). Retail performance has shown to be greatly influenced by the digital environment, with major players in the sector setting the standard for technologically advanced strategies. Having over 23 million active consumers in 2023, ASOS, the massive online apparel

5 retailer, is a prime example of this trend (Leal Filho et al., 2023). Personalised suggestions, sophisticated data analytics, and smooth multi-channel experiences are the reasons behind its success. By utilising its effective logistics network and Prime membership programme, Amazon maintains its dominance in the e-commerce market and sets the benchmark for quick and dependable delivery. Retail success now strategically depends on e-commerce to foster global expansion and cross boundaries. According to Burberry's 2023 Q3 Results, the company's successful entry into China and other Asian regions drove a 35% increase in e-commerce revenues in 2023 (Okhmatovskiy, 2023). An established business, Marks & Spencer, showed that it could expand internationally through internet channels by registering a 20% rise in foreign online sales in 2023 (Roper, 2023). An increasing number of environmentally concerned consumers have made sustainability an attractive prospect in the retail sector. 66% of worldwide customers are prepared to spend more for sustainable products, according to a 2023 Nielsen study (Šálková et al., 2023). Budget- friendly apparel retailer Primark has increased its efforts in response to this demand by introducing a sustainable clothing line made from recycled materials. This tactical decision highlights how sustainability has the power to influence customer decisions in the retail sector and is in line with the company's commitment to satisfy the growing demand for eco-conscious solutions. Overcoming Challenges in Retail Sector Critical evaluation

6 UK retailers need to do a high-wire performance to succeed in this ever-changing retail environment, balancing on a tightrope that is suspended between possibilities and obstacles. On the one hand, e-commerce behemoths are threatening to overshadow conventional retailers due to their digital disruption of established patterns. Another degree of complication is added by the threat of economic instability, with inflation eating away at customer confidence and profit margins (Harper, 2023). But among these dangers are brilliant rewards waiting for those brave enough to claim them. The secret to opening the trove of opportunities is innovation. Retailers can set themselves apart from the competition and create seamless shopping experiences by utilising cutting-edge technology like AI-powered personalisation and augmented reality in-store experiences. Through the smooth merging of online and offline touchpoints, omnichannel integration promotes ease and consumer loyalty, turning the shopping experience into a comprehensive trip (Savastano et al., 2019). But technology is insufficient on its own. 21st- century retail success requires a commitment to values-driven strategies. Consumers now want sustainability; it's no longer a fringe issue. A rising number of environmentally concerned consumers are drawn to products that include eco-friendly methods into their supply chains, operations, and product development. Establishing fair labour standards and conscientious manufacturing methods through ethical sourcing also fosters trust and brand loyalty. In the end, the stores that build real relationships with their clients will be the ones who prosper. It's critical to comprehend how their wants, values, and tastes are changing. Brand advocacy and a feeling of community are fostered via social responsibility, community-building programmes, and personalised marketing. Customer interactions in this environment are partnerships based on respect and shared ideals rather than transactions. Therefore, it is not for the weak of heart to navigate the UK retail scene. It requires dexterity, bravery, and an acute sense of both the bright spots and the storm clouds. UK merchants may thrive in this constantly changing and dynamic market by adopting innovative strategies, integrating omnichannel operations, values-driven business practices, and cultivating strong customer connections. Conclusion In conclusion, the retail industry in the United Kingdom has a combination of possibilities and problems in the worldwide market in 2023. Strategic innovation and adaptability are required due to the dynamic interaction of digital disruption, economic concerns, and altering customer preferences. The three pillars of resilience are values-driven initiatives, omnichannel integration,

Your preview ends here

Eager to read complete document? Join bartleby learn and gain access to the full version

Access to all documents
Unlimited textbook solutions
24/7 expert homework help

7 and embracing technical improvements. Retailers may succeed in this changing climate and overcome obstacles by developing a deep grasp of client demands and genuine connections. The key to success in the cutthroat retail industry is the capacity to handle complexity with dexterity and innovation while maintaining a customer-focused, long-term strategy.

8 References Borges, M.S.M., 2023. Luxury that lasts: rise of second-hand fashion and consumer experience according to the purchase channel (Doctoral dissertation). Dada, A., 2022. Exploring The Influence of Electronic Word-Of-Mouth (eWOM) On Intention to Share-Wallet: A Study of UK Retail Banking Customer Using the Theory of Planned Behaviour (TPB) (Doctoral dissertation, Cardiff Metropolitan University). Ezkieta Mendiburu, A., 2023. Fast fashion industry and the sustainable development goals. Ghauri, P., Strange, R. and Cooke, F.L., 2021. Research on international business: The new realities. International Business Review, 30(2), p.101794. Ghauri, P.N. and Ott, U.F., 2022. Post-brexit Trade Policy and Its Impact on United Kingdom’s Economy. In Global Trade and Trade Governance During De-Globalization: Transforming Trade Policy for Not-So-United World (pp. 109-121). Cham: Springer International Publishing. Harper, A.L.E., 2023. Practice Briefing The future of the UK turnover-based lease in the world of omni-channel retail. Journal of Property Investment & Finance, 41(3), pp.319-332. Jones, P., Wynn, M. and Comfort, D., 2020. SDG 12, Sustainable consumption and the UK’s leading retailers. RESPONSIBLE CONSUMPTION AND PRODUCTION, p.7. Lapavitsas, C., Meadway, J. and Nicholls, D., 2023. The Cost of Living Crisis:(and how to get out of it). Verso Books. Leal Filho, W., Dinis, M.A.P., do Paço, A., Herédia-Colaço, V., Veiga Avila, L., Dennis, K., Tyler, D., Neiva, S. and Liakh, O., 2023. COVID-19 and sustainability in textile, apparel and fashion use: an assessment of trends. Textile Research Journal, 93(3-4), pp.674-690. Martos Crespí, C., 2021. A study of the internationalization strategies of the new business models in the fashion industry: second-hand, rental, subscription and interchange. Nguyen, M., Chen, Y., Nguyen, T.H., Habashi, S.S., Quach, S. and Thaichon, P., 2022. Artificial intelligence (AI)-driven services. Artificial Intelligence for Marketing Management. Okhmatovskiy, I., 2023. Metaverse in Luxury E-Commerce (Doctoral dissertation, Nova School of Business and Economics). Roper, J., 2023. The Rise of E-Commerce: From Dot to Dominance. Pen and Sword History. Roper, J., 2023. The Rise of E-Commerce: From Dot to Dominance. Pen and Sword History.

9 Šálková, D., Hes, A. and Kučera, P., 2023. Sustainable Consumer Behavior: The Driving Force of Innovation in Retail. Sustainability, 15(24), p.16648. Savastano, M., Bellini, F., D’Ascenzo, F. and De Marco, M., 2019. Technology adoption for the integration of online–offline purchasing: Omnichannel strategies in the retail environment. International Journal of Retail & Distribution Management, 47(5), pp.474- 492. Upadhyay, A., Kumar, A. and Akter, S., 2021. An analysis of UK retailers’ initiatives towards circular economy transition and policy-driven directions. Clean Technologies and Environmental Policy, pp.1-9. Vyas, S.K., Vyas, L., Singh, S. and Joshi, M., 2023. Future of E-Commerce: A Robust Review. In Intelligent Sustainable Systems: Selected Papers of WorldS4 2022, Volume 2 (pp. 697-710). Singapore: Springer Nature Singapore. Yoon, S.P. and Kwon, H.Y., 2021. Analysis of the Global Data Law & Policy and its Implications: Focusing on the cases of the United States, the United Kingdom, and the European Union. Informatization Policy, 28(2), pp.98-113. Zaki, M., 2019. Digital transformation: harnessing digital technologies for the next generation of services. Journal of Services Marketing, 33(4), pp.429-435.

Your preview ends here

Eager to read complete document? Join bartleby learn and gain access to the full version

Access to all documents
Unlimited textbook solutions
24/7 expert homework help

THE CHANGING NATURE OF THE GLOBAL

Related Documents