Impact of COVID-19 on Consumer Retail Demand

Economics for
business
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INTRODUCTION...........................................................................................................................3
Task 1...............................................................................................................................................3
Supply and Demand analysis to determine the factors impact on consumer retail demand. .3
Task 2...............................................................................................................................................4
Governmental and Economic policies of UK for economic recovery from loss of consumer
retail spending........................................................................................................................4
CONCLUSION................................................................................................................................6
REFERENCES................................................................................................................................8
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INTRODUCTION
Nearly all the business sector is however being get affected due to corona virus outbreak,
this not only affected their growth and development of this sectors but also makes changes in the
behavioral pattern of consumer shopping. This makes businesses to attract customers with more
attractive offers in order to retain them and conduct sustainable business operations. B2B, E-
Commerce, B2C and all segments specially retail sector really affected due to COVID-19
outbreak. This report includes information and data that are required to be understand by retail
brands in order to determine consumer behaviour that get changed in past few months after
corona virus outbreak and lockdown. In order to effectively present this information, demands
and supply analysis technique is being undertaken through which business can identify negative
as well as positive shift in demand for retail services and goods. In addition to this report also
includes manner in which economic and UK Government Strategies and policies are helping
business sectors to overcome the losses.
Task 1
Supply and Demand analysis to determine the factors impact on consumer retail demand
The income effect and shift in employment –
Employment is determined as most essential element that is having high influence upon
demand of services and goods in retail industrial sector. Individuals who are having steady
income generation sources are having expectations to continue revive the same then it makes
discretionary more spending purchases that shifts demand curve towards right. Unemployment
increase will lead opposite outcomes in which individuals with less income sources lesser down
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the purchase of a necessary and luxury goods. This will negatively impacted upon each and
every sector of UK market that make individuals to loss their job. However many segment in
retail area still engaged in the process of hiring, such as doorstep delivery. According to the
report of BBC, many companies in United Kingdom forces employees to take voluntary
retirement and other job quitting options which affected growth of economy (Unemployment
rate: How many people are out of work?, 2020). This will affect decrease in the power of
customers of purchasing. This has raise the demand of consumers for retail goods or services that
meet their basic needs rather than on luxury goods.
rather than on luxury goods.
Price
D1 D2 here, D2 = Rise in demand of food and groceries
D3 D3 = Decrease in demand of other retail goods
Quantities of retail goods
UK regional or local demand factors –
Covid-19orr corona virus in pandemic massively shocks almost all the countries around the
globe and severely affected growth development economies of all the sectors in every nation.
Likewise in United Kingdom this pandemic causes negative impact on country GDP in many
business sectors. However food retail sector continued to conduct their sustainable business
operations as it is basic necessity. According to the forecasts it has been evaluated that this sector
expected to grow by 7.5 billion, however footwear and clothing retail segment will continue to
suffer losses approximate to 13 billion British Pound, in their annual sales. While identifying and
emphasizing upon combination of local sector differences in sectoral performance acts a major
driver in variability of economic performance. This plays major factor in economic reform
variability according to regions. For example regions who are mainly depends upon manufacture,
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