The UK Retail Sector: Economic Impact of COVID-19 Analysis

This report provides an economic analysis of the UK retail sector's performance during the COVID-19 pandemic. It examines the factors influencing shifts in consumer spending, including changes in demand and supply due to the pandemic, and the impact of consumer preferences on the retail market. The report also analyzes the main UK government and economic policies implemented to influence consumer spending and mitigate the negative impacts of the pandemic on the retail sector. The analysis includes the impact of the pandemic on employment, income levels, and elasticity within the retail market. The report draws upon various government sources and academic references to provide a comprehensive understanding of the economic challenges and policy responses within the UK retail sector during this period. The report also discusses the role of government policies, such as poverty programs, in supporting the retail sector's sustainability and recovery.

Economics for business

Executive Summary
Business Economics is the field of study of micro environmental factors which directly
impact on living life and standard policies of human beings every individual need to fulfil their
basic demands for this purpose they Run business this report has been formulated to identify the
impact of economic crisis has been arises within the UK economy at the present time the whole
word suffers from covid-19 pandemic which will directly impacted on the preferences of
consumers being the king of the market customers demand their preferences their thoughts that
impact on the production level of each sector this report has been refined impact of customers
preferences they are changing perception due to the impact of this pandemic as well as British
agreement the changes of demand and supply curve elements which directly impact on these
curves and the policies procedures used by Britain government to recover or reduce the impact of

this pandemic on retail sector it is also define the necessity of using policies of government to
maintain retail sector sustainability and to recover the loss which is arises due to the Logon
period this report take all the essential information from various government sites as well as
books which help in collecting essential data for successfully completion of this project .

Contents
Executive Summary.........................................................................................................................2
Contents...........................................................................................................................................3
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
Factors determining shifts in consumer retail spending in UK due to Covid-19........................1
TASK 2............................................................................................................................................4
Main UK government and economic policies to influence consumer spending.........................4
CONCLUSION................................................................................................................................6
REFERENCES................................................................................................................................8
Coronavirus: Retail sales crash in April as lockdown hits shops [Online]. Available through.......8
UK national debt highest since 1960s after record October borrowing – as it happened...............8
Digital currency could help with negative interest rates, says BoE's Haldane – as it happened.....8
FTSE 100 hits five-month high after Moderna vaccine boost – as it happened..............................8

INTRODUCTION
Business economics help in understanding the impact of micro economic theories in real life
situation of business. To understate this concept, retail sector of Britain has been taken. This
sector consider all those industries which are related or engaged with providing product and
services which useful in fulfilling the demand of essential products. This report has been define
how consumers behaviour directly impact on the demand & supply curve. Their reference
change or shift curve position and business policies strategies use by government of UK to
control the impact of pandemic . It also consider or define those elements which become the
main reason of shifting of theses curves.
TASK 1
Factors determining shifts in consumer retail spending in UK due to Covid-19
Demand and supply both are directly impact on production as well as retail market sector
of any country. Britain is one of the most developed country which s rule over the world. Now
country maintain their position in market by taken market share at international economy. Retail
sector of Britain is play essential role for developing of this country’s origin. There are various
ration industry which influence the market sector and build strong position in international
market. Specially in case of supermarkets, and manufacturer sector. Tesco, Sainsbury cover the
entire market area by provididing their best services. But the market is totally depend on various
elements which directly impact on the level of production which are define below
(Poverty program. 2020)
Law of demand & supply: Theses are essential elements for run any market economy. Demand
are the wants and desire which influence customers to purchase goods and consume services
which provides them satisfaction, on the other side supply is related with sellers. On the basis of
getting demand from customers, manufacture produce good and supply with the market for
fulfilling demand of customers. Both are related with each other.
Customers are the essential factor their preference, choice are directly impact on the retail sector.
Following are the sifts in demand as well as supply curve have been shown with the impact of
Covid -19
Local demand factors
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These factors considered most essential elements. As It includes preference and choices
of customer. In case of retail business sector. It directly impact on the profitability rate of
business. Britain consumers demand has been decline in sector especially for real state, food
after those pandemic. Britain is famous for their food and travelling service thus all the
complementary products which related with food market has been on high demand. But after the
impact of Covid – 19 the rte of tourist has been totally decline as it has been 3 month complete
lockdown period which directly impact on the food sector it adversely affect the product as well
as retail market sector as the demand of products has been decline (Coronavirus: Retail sales
crash in April as lockdown hits shops 2020)
On the other side when customers demand for products then supply as well as price of those
products has been raise up . Due to the impact of Covid -19
It is direly impact on supply factors also. It has been identified that demand of cosmetic
products has been decline which may become the reason of supply adversely.
Complementary or substitute goods
Complementary goods includes or consider those products without which particular
goods are not use by customer. It is require to have use of complement goods for other goods.
There are various types of products available which require other goods also for providing
satisfaction to customer. Car and petrol, Shoo and socks as well as cosmetic products , juice,
food items. When the demand of complementary good get high then its relative products demand
get already in positive direction it shift from right to left. On the their side when price of
complement good is increase then the demand curve shifts.
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Just like demand curve suppliers of complement goods also affect from change or shift in
particular products. When the supply of car has been increase in the market then it will direct
impact on the supply factor. When supply of complementary good has been increases then it
directly impact on the supply level of products (Analysis of demand. 2020).
At present time the impact of corona virus has been spread at high speed which directly
impact on the consumers spending. At present time value of grocery product has been increase
because of increment in the quantity supply as well as demand of heath care products also
increase which directly impact on the shutting of supply curve. Production quantity of these has
been increase which impact on the supply curve.
Income effect and shift in employment: Income is the source of living life. It directly
impact on the preference of customers as well as curve of demand and supply.
Higher income level useful for organizations to increase their spending or expenses level . On the
other side organization also focus on formulating their polices and pricing strategies according to
the social class of people.
Customers preference related with retail sector specially in case of cosmic market their
demand has been decline was due to the impact of corona virus many people left from their jobs
the rate of unemployment has been increase which directly impact on the curve. Due to this
pandemic demand curve of retail sector has been shifted from right to left as prices of some
products get high. On the other side due to reduction in the income source of consumer the
supply of product has also been decline as the flow of money within the economy has been
reduces. Which direct impact on the shifting of demand curves. Even though the market of retail
sector has been effected from this pandemic but with the last 2 months demand graph of
electronic market has been increase however products related wit transportation has been
decline. It also impacted on the supply curve as when price of good has been increase then
supply quantity of products has also been increase and the main reason of increment of supply
when market demand is high but due to the reduction in the income source of consumers the rate
of demand has been decline.
Elasticity: It direct impacted on the effect of law of demand and supply. Elastic has been shown
the result of relationship between prices and demand and supply. According to the theory of
micro economic. When the price rate is high demand of particular products has been decline. On
the other side when the product price rate has been decline then demand of product in market is
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getting at high level. This is same la apply on supply sector. When supply rate is high then prices
are getting high of product and vice versa. Demand is directly impact on the performance of
each and every business sector (Krugman, and Wells, 2017).
At present time retail market sector profitably rate has been decline. But market condition
of retail sector is not in favourable condition. However there are some field where rice rate of
product get high due to the supply of these products .at present tie medical sector earn product
there demand area has also been increase and curve shifted its place. On the other side market
price of cosmetic product has been decline due to the impact of his pandemic.
Demand and supply theses factor are direct related with behaviour of consumers their though
precision as well as all the things which impacts of the related felid. Consumer are now become
the king of market thus they change the entire sector. Which direct impact on the demand and
supply sector. It adversely affect retail business sector which may become the reason of shifting
of curve. For of fulfilling demand of customer the Britain government focus on how they can
able to reduce the impact of Covid as it directly impact on business policies.
TASK 2
Main UK government and economic policies to influence consumer spending
Government of UK for controlling and managing their retail market condition use various
policies which useful and help in maintain economy condition in this pandemic period.
Following are the polices which are define below
Poverty program: The Government of UK ensures that the formulation of a wide range of
policies and procedures can be done in order to make sure that the (UK national debt highest
since 1960s after record October borrowing – as it happened 2020) solution of a wide range of
problems and issues which have happened due to the pandemic can be solved effectively and
efficiently. The COVID-19 pandemic has impacted the UK Government a lot and in particular
the retail sector has been the worst affected due to the impact which was created by the
pandemic. The change in the economic policies by the UK Government will help in ensuring that
the N5 percent of employment to the overall employment of UK due to the impact of this
pandemic and economic policies the rate of unemployment is getting high which directly impacts
the spending habit of the consumers which is due to reduction in the consumer spending which
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have influenced the demand curve because an increase in the consumer spending means an
increase in the overall level of demand of the consumers and the increase in the overall level of
profitability of the organizations effectively and efficiently. In the present time demand of auto
mobile sector has been on a decline because the lower demand of the food product as a decline of
bye formulating effective poverty program in the organising of events and providing subsidiaries
government can be helpful for the poor students which will help them in managing their own
business and make them capable so they can able to to get selected in any organisation it will
help in in making better their life cycle as well as it directly impact on cash flow cycle of
economy through the use various type of policies which help in removing child and women and
other various social groups poverty. Thus the motive here is to make poor people capable so they
can able to live their life in happy as the lower-level of spending on the income on necessary
products can create a direct impact on the retail sector market.
Government subsidies: Government of UK provide financial assistant to retail sector yes they
know that demand and supply directly impact on the consumers behaviour does government
formulated effective policies as well as provide subsidiaries and give them right to trade their
business without legal implement action of rules or impose policies and restrictions Britain
government after analysing sick Industries they provide the financial assistance as well as other
financial institution help them giving them guideline and provide them management expertise
advice which helped retail sector organisation to enhance their market as well and spread the
market and within global economy at the present time period after the impact of corona virus it
has been seen that government of UK by using their funds concentrate on building retail sector
more effective does they focus on motivating consumer so they can able to influence on motivate
for purchasing grocery products as well as cosmetic and other retail sector product it will help in
maintaining cash flow within the market economy as well as help in sustaining market position
of retail sector it also directly impact on demand curve so it will help in controlling the shifting
of demand curve within given time period (Digital currency could help with negative interest
rates, says BoE's Haldane – as it happened 2020).
Stimulus package: Britain is one of the most developed country but corona virus
adversely impact on its economy cycle this country already suffered from low rate of GDP as a
less political and environmental issues scenes 4 to 5 years however they formulate policies which
5

help them to recover all the C shoes but it took upcoming 4 to 5 years to reduce the overall
impact and loss which arises due to the this pandemic consumer behavior perception has totally
with change after the lockdown period as well as at the current time their faces this Panda make
there perception regarding market strategy as well as their habits of spending in income has
totally been changed does government use stimulus packages which useful in in attaining their
long term goal by effectively measure retail sector performance the sector help in generating
more than 30 % of profit of GDP as well as it will useful in providing and sustaining great
market position and impact in international economy of Britain the government use these
packages for providing financial assistant as well as giving them relief regarding taxes and other
legal and custom duties which help retail sector organizations to spread their market and why can
ethical manner at the present time cosmetic as a less grocery products has been demand decline
but the market price of of health care product has been increase does government focus on
production of Healthcare products as well as changing according to the perception and
Consumers demand the change and influence hospitality sector food and industry as well as retail
Supermarket sector to use those product which help in maintain health healthy products to
customers and Boom boost immunity system of consumers for this purpose the use stimulus
packages which help in retail sector to fulfill demand of consumers and maintain their shifts of
demand supply curve. All theses measure useful in attaining business goals as well as maintain
the demand and supply curve in effect way for attaining business retail sector goals.
Industry measure: This is one of the most useful policy and procedure which help in
maintaining curve of the sector government of UK on the basis of measuring Industries
performance and profitability is formulate policies and procedures as well as the provide
financial assistance to sick organisation and use merger and acquisition policies which help in
maintaining sustainability within the retail market sector this school useful in maintain in
covering loss which arises due to the impact of Lockdown period consumers preferences has
been changed within a short time period does every retail sector organisation has been adversely
impact on then they need to change their policies procedure and use and developed innovative
products which help in fulfilling demand of customer does government of UK provide various
subsidiaries as well as assistant and which help retail market organisations to maintain the year
position within the market and control shifting of demand and supply curve.
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CONCLUSION
From the above analysis it has been concluded that , retail sector help in developing
economy of Britain by contributing more than 30 % of margin for this country. This sector
proved employment s ell as build strong position international market by supplying their
products and service. Due to the impact of Covid- 19 pandemic this directly impact on the
demand and supply curve. By formulating effective poverty polices, subsidiaries and identifying
industry analysis government of UK maintain and control the adverse impacts of changing
preference of customers on the demand and supply curve of retail market. As this help in
providing long term economic goals.
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REFERENCES
Books and Journals
Poverty program. 2020. [Online]. Available through
https://blog.ons.gov.uk/2020/09/18/how-the-covid-19-pandemic-has-accelerated-the-shift-to-
online-spending/
Coronavirus: Retail sales crash in April as lockdown hits shops [Online]. Available through
https://www.bbc.com/news/business-52766856
Analysis of demand. 2020. [Online] Available through
<https://www.investopedia.com/terms/l/law-of-supply-demand.asp>
Krugman, P. and Wells, R., 2017. Volkswirtschaftslehre. Schäffer-Poeschel.
UK national debt highest since 1960s after record October borrowing – as it happened 2020)
[Online] Available through
https://www.theguardian.com/business/live/2020/nov/20/uk-national-debt-october-borrowing-
covid-19-retail-sales-ftse-business-live
Digital currency could help with negative interest rates, says BoE's Haldane – as it happened
ttps://www.theguardian.com/business/live/2020/nov/18/uk-inflation-cpi-clothing-food-ftse-
bitcoin-busine
FTSE 100 hits five-month high after Moderna vaccine boost – as it happened
https://www.theguardian.com/business/live/2020/nov/16/japan-recovery-stock-markets-covid-
vaccine-ftse-business-live
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