In mid-March 2020, when the Prime Minister asked us to go into the first lockdown, we closed our Vancouver head office expecting to return in a few weeks. We didn’t even properly clean out the fridge.

We didn’t anticipate that almost a year later, like many organizations, we would not have returned and would still remain working remotely. We didn’t anticipate that the drop in our open orders would be so immediate, and last for such an extended period of time.

When it became apparent these weren’t temporary measures, we, like the service industries sectors we serve, weren’t certain we would survive. We consider ourselves fortunate that associations for those industries used their powerful reach to lobby hard. While it took longer than anticipated, our government stepped up with wage and rent subsidies that have helped save the day and bridge us to the other side of the worst of Covid’s financial impact. We know for the retail sector, many have not been so lucky. Some commodities like Food and Drug have thrived. Yet others like Apparel remain in peril, with the Apparel sector itself on track to see a 90% plunge in profit, according to the ‘State of Fashion’ report by The Business of Fashion and consulting firm McKinsey & Co. In every commodity, independent retailers have been the hardest hit with liquidity and supply chain issues that hinder their survival.

Almost 11 months into this crisis, Ontario and Quebec remain in lockdown, though reports are that Quebec is reopening some portions of its economy as of the week of February 8. Ontario, our biggest province, remains without a plan to end its full lockdown. The online publication Insolvency Retailer highlighted 244 insolvency filings in 2020, as the pandemic wreaked havoc on the financial viability of many companies in Canada. Unfortunately, retail led all industries. The costs of carrying inventory, even if retailers pivot to emphasize digital sales and curb-side pickup, are simply too high if you can’t have customers come through your door. Retailers with weak balance sheets and declining sales remain at risk.

2021 – The Year Ahead

Shifts coming in bricks & mortar

While we’ve seen major retailers like Aldo, Reitman’s, Laura, Le Chateau, Henry’s, and MEC go into bankruptcy protection and under the protection of CCAA, there has been an interesting shift of ownership as many landlords may make additional acquisitions of troubled retailers to avoid loss of tenant income, evidenced by their purchases of JCPenney, Forever 21, and Aeropostale. We have seen this as well in smaller markets with smaller or independent retailers.

And while many retailers are seeking to downsize their footprint with the consumers rapid shift to digital, Craig Patterson, Editor-In-Chief at Retail Insider says that “where rents are currently going down, some retailers are looking to find the right spot and are willing to do a lease deal.” He also reported that “2020 saw at least 13 international brands enter the country. While it’s the lowest number since Retail Insider began tracking international entrants in 2014, it’s still an impressive number given what has been a transformative year for the retail industry in Canada.” Ultimately, we know that landlords and developers will be taking a good look at their mix over the coming year. The shift towards non-traditional retail that started prior to this crisis will accelerate to include residential, fitness, entertainment, food service and institutional spaces in order to drive the foot traffic retailers need to thrive.

Digital will dominate and retail sales will rebound

The public is taking a wait and see approach to the return to their pre-Covid shopping habits. As a result, the shift from stores to e-commerce is expected to continue to accelerate in 2021, and over the past year, digital and omni-channel grew to become 50% or more of some retailer’s sales. Despite the very bumpy start of the vaccine roll-out, the HRC Retail Advisory suggested in a recent report that they expect the first half of 2021 to be a continuation of 2020’s acceleration toward digital and omni-channel, as most shoppers remain at home. In terms of results, they predicted “2021 is likely to be a good year for retail, with increased consumer spending in the back half of the year due to pent-up demand in categories that suffered the biggest declines in 2020.”

And many categories that haven’t declined as much during the pandemic are expected to continue to their relative strength. For instance, homebound and nowhere to go, it’s predicted that Canadians will likely continue to invest in upgrades at home, improving and updating their indoor and outdoor environment.

Needed skills will include technical & analytical, business/commercial and operational

The need to create and enhance digital capabilities, whether it means investing in processes, tools, or talent, will remain a critical priority in 2021. Taking business risks, innovating, rebuilding customer engagement and becoming truly “omnichannel” will be critical success factors for retailers.

With store traffic severely impacted and limiting their ability to communicate with customers in the same ways as pre-pandemic, retailers must find new ways of reaching consumers. Continued innovation to promote consumer confidence and trust in your business, as well as to increase overall productivity will be critical in the recovery. Ecommerce forecasts indicate pressure will increase on retailers with weak online and order delivery capabilities. George Minakakis, the CEO of Inception Retail Group Inc., recently wrote an op-ed that in response to these trends, “Retailers should continually upgrade and improve their e-commerce platforms and all other digital assets. Digital assets need to be refreshed more frequently than even a store front especially in keeping up with social media as a marketing channel.” Hiring teams with ecommerce, analytics, marketing and digital capabilities has never been so critical and the pool of talent is in short supply and high demand.

Organizations will also still need great operators to lead teams, great merchants to buy products, strong supply chain experts to distribute goods and in the executive suite, retailers ideally need leaders who can plan for what's ahead. According to Jennifer Lee, Canadian & Global Managing Partner (Growth Platforms) at Deloitte, organizations will seek out leaders who can help shape an insight-driven organization - develop strategies, hire people, create processes, derive data, use technology effectively, along with operating inspiring stores.

During this next decade, retail executives will hire teams who are a mix of both technical and analytical, to partner with those who have the needed business/commercial acumen and strong operational skills. Great leaders will assess the insights and figure out how to tell a brand story that appeals to their consumers and allows them to access product the way they want to shop today. There’s art and science to retail today and hiring needs will focus on onboarding balanced teams who can collaborate effectively.

Retail jobs are recovering

There’s a perception in the market that there is an abundance of available talent. Let’s see what the job numbers tell us. According to Statistics Canada, in February 2020, the month before the pandemic hit, Canada’s unemployment rate was 5.6%. Canada’s unemployment rate sat at 8.6% as of December 2020, well down from a record high in May 2020 when it leapt to 13.7% as the economy ground to a halt.

In terms of retail employment, surprisingly the statistic shows a strong V shaped recovery. Initially, at the start of this crisis, thousands of people in the retail industry lost their jobs. Particularly hard hit were front line workers and middle-management roles as companies furloughed and laid off employees. Yet employment in retail trade edged up by 19,000 (+0.9%) in December. While this pace of growth was slightly lower than in October (+1.4%) and November (+1.5%), it surprisingly brought the industry to within 2.9% of its pre-COVID employment level. We believe that the key factors that account for this rapid recovery in job numbers for our sector is that front-line consumer facing teams have been redeployed to oversee the fulfillment of on-line sales - customer service representatives, delivery drivers, IT and support desk specialists, procurement and supply chain specialists, and warehouse workers.

Bricks and mortar jobs are also recovering in some areas. In anticipation of continued demand by homebound consumers to upgrade those homes, Lowe’s just announced it will hire 7000 full-time and part-time positions to be filled in Lowe's, RONA, and Reno-Depot corporate stores across the country in anticipation of this surge.

To learn more on this and other retail trends and insights you can check out our blog.

JRoss remains intact

Throughout the pandemic, our focus has been on continuing to deliver for our clients and maintaining our team of Canada’s leading retail recruiters. We’re happy to report that we made it through 2020 with our delivery team intact, and we’re now actively working on dozens of mandates at all levels from front-line management through to the executive suite. You can view these great opportunities on our website.

Even if you’re not in an active job search, don’t forget to connect to us through our company LinkedIn page, Facebook and Twitter to share relevant retail industry news, networking tips, and current roles we are working on. Your resume should also be up to date in our system. Please keep us updated with any new changes in employment status and contact information so we can connect with you if your next great career opportunity crosses our desks. And if there’s one other key thing you can do to increase your exposure, it would be to fully optimize your LinkedIn profile to increase the likelihood that you will show up positively in the search results when recruiters are sourcing candidates that match your set of qualifications, education and experiences.