- The following statement was released today by One Bermuda Alliance MP Ben Smith, Shadow Minister of National Security…
The retail industry in Bermuda was in poor shape prior to the arrival of COVID-19. The factors contributing to its decline, include, but are not limited to, overseas shopping due to lower prices and greater variety of product, a reduction in Bermuda’s workforce and an overall downturn in the global economy.
With the closures we have seen since we started our phased reopening, retail is now in a position of critical health.
I do not think there is one person in Bermuda who is not familiar with Amazon, E-Bay, Etsy and other online retailers who offer a wide variety of items and, most times, at half the cost, pre-shipping, handling and duty. And even if the landed cost is more than it would be in Bermuda many people are willing to pay the aggregated price, because of availability, and variety.
Everyone likes to buy things that are unique, different, and unavailable in Bermuda. Equally, everyone also likes to have quick access to goods, and most items can reach Bermuda in a relatively short time. Though, research shows that people still prefer the in-store experience to online shopping.
Many local retailers have begun matching US prices for the goods and products they provide. This could facilitate an increase in local purchasing. An increase in sales means a growth in business, which means, potentially, an increase in hiring sales staff, bookkeepers, and a store manager. The downside that retailers face in being able to match overseas competition with online retailers that do not carry the same level of overhead that a “bricks and mortar” retailer carries.
Variety is key. While I fully appreciate that there is a cost to maintaining inventory, the ability to provide an item in multiple colors, shapes or sizes is critical, and having a choice gives shoppers a sense of freedom and control.
With that being said, we need to understand retail and the decisions that must be made when doing busines in Bermuda. The product on the shelf in many cases was ordered months in advance from the supplier and manufacturer, and the buyer had to choose from all the different varieties which ones to import. With the taxes, fees and costs attached to that item being on the shelf bringing in every single item for the variety desired is a risk the retailer cannot take.
In Bermuda, there are over 3,000 retail type jobs which translates into it being a major employment area for Bermudians. The huge egress of both expatriates and Bermudians from 2008 to date has been a major contributor to the loss of retail dollars.
So, what do we do to sustain this vital industry? Reality check – solutions will be unpopular, and indeed, unpalatable, but bold decisions must be made if Bermuda retailers are going to be able to compete – let alone survive.
In support of rebuilding retail, I put forward the following ideas for consideration:
- Level the playing field for retailers and on online purchases.
- Ensure that all persons importing goods have a shipper identification number.
- Retail business should have a different code to other non-retail importers which allows them to use the customs systems presently set up. This means that
thelocal retailers could make the online purchase on your behalf for items that may be in a different color or style than the item in the store. This purchase through the retail business, which can often purchase items at wholesale prices, would likely be less expensive than if you ordered it online at retail prices.
- Provide duty exemptions for those items that are just not obtainable on-island.
- When an item is on the shelf in Bermuda with an outrageous price tag there would be a reporting mechanism to have this issue addressed. Many Bermudians have identified items being sold locally that have a ridiculous mark up. The changes to support retail cannot protect this behavior.
The lifeblood of retail has always been and will always be sales.
But in addition, retail can also help themselves – exemplary customer service turns casual purchasers into loyal customers. We also cannot overlook responsive communication, well-trained salespeople, effective use of technology, anticipating customer needs and providing personalized experiences. These are a few of the things that ensure positive outcomes.
Keeping customers happy and coming back with repeat business is all about providing a positive and consistent customer-centric experience. To revive retail, we must make the customer service experience personal and satisfying to create a competitive advantage. We need to give help to this industry while we ask them to help themselves.
And as customers we must do our utmost to buy locally when and where we can. Retail provides jobs for Bermudians and we need to support each other in this way.
- Top Feature Photo: Bermuda Stream