Pandemic causes Swiss online retailers as much work as at Christmas

So many orders are usually only placed just before Christmas: Online retailers like Digitec Galaxus are booming thanks to corona.

To keep the coronavirus under control, the Federal Council has declared an "extraordinary situation": Stores that do not serve basic needs must remain closed. People are asked to stay at home if possible.

Many people are therefore ordering online: "We are currently receiving as many orders as usual just before Christmas," says Digitec-Galaxus spokesperson Alex Hämmerli. And his counterpart at the Brack Group Competec, Daniel Rei, adds: "The only difference is that Christmas Day doesn't come: so there are always lots of orders."

In a recent video interview with FDP National Councillor Andri Silberschmidt published on Instagram, Brack boss Roland Brack even went so far as to say: "I would like to see fewer orders."

But not everyone is benefiting from the boom: fashion retailer Zalando, for example - the sector's top dog in Switzerland - has cut its forecasts for this year. The first quarter alone will be significantly worse than recently expected by analysts: European customers have held back on purchases and restricted their consumption.

Customers have to be patient

On the other hand, online orders are now also shooting up at retailers for whom their store network is a strong pillar. Bookseller Orell Füssli Thalia, for example, is reporting a 50 percent increase.

The flood of orders also has an impact on delivery times: At Digitec-Galaxus, it takes about two days longer than usual for orders to reach customers. At Orell Füssli Thalia, there may be delivery delays of around three to four working days. And at Ikea, customers now have to reckon with 25 days for normal furniture deliveries.

The grocery stores are also currently overwhelmed with orders: Orders at Coop@home have doubled, says Coop spokeswoman Marilena Baiatu. In most regions, delivery times are fully booked for several days. There are also waiting times at Migros' LeShop, and Farmy, which specializes in regional foods, is already fully booked for the whole of April, according to information on its website.

Swiss Post is also demanding all of this: to remedy the situation, it has already applied to the Federal Council for special permission - and received it - to deliver groceries on Sundays too. It is also reducing its service by closing some of its branches and taking more time with deliveries.

Flexible reallocation of personnel

Online retailers and their logistics partners are therefore required to rapidly increase their capacities. At Migros' online retail subsidiary Digitec-Galaxus, for example, logistics has been strengthened with over 200 new employees. "We are borrowing some of them from companies that have fewer or no orders because of the pandemic," says Hämmerli.

Brack has also recruited over 50 employees in logistics and wants to take on more. As it is not possible to train so many people at once, Brack said that there are ten new people every day. Night and Sunday work has also been requested. Certain products, such as toilet paper, have also been removed from the range to ease the workload. Employees from other departments were also called in.

The Coop subsidiaries Microspot and Coop@home were able to organize themselves through internal changes alone. For example, employees who normally work in the now closed stores of Microspot's sister company Interdiscount are now helping out in online retail.

According to Thomas Lang from the management consultancy Carpathia Consulting, the larger stores now have a certain advantage overall: they are better prepared for such peaks, as they experienced a similar rush on Black Friday or Christmas. "But in the current situation, this will probably last even longer, and they have not been able to prepare for these capacities any longer."

Additional boost possible

It remains to be seen whether the additional boom in online retail will continue beyond the coronavirus crisis. No predictions can be made, says Microspot spokeswoman Sachs. "It remains to be seen whether more consumers have acquired a taste for online shopping after the reopening of bricks-and-mortar retail," says Brack spokesperson Rei. However, Brack expects the situation to return to normal.

Others expect at least a certain after-effect: Galaxus, for example, is expecting a reverberation effect: "Many older Swiss people in particular are discovering the advantages of shopping online these days," says Hämmerli.

Coop@Home also expects that the strongest growth in the food store within the Group for years will be further boosted by current developments. In general, online food retail still has a lot of potential: according to recently published figures from the Swiss Mail Order Association (VSV), e-commerce only accounts for 2.8 percent of the total volume.

One thing is clear: business has been steadily shifting from stores to online retail for some time now. "The current situation will certainly give this shift an additional boost," says e-commerce expert Lang. The boost is coming "above all from shoppers who are generally shopping for the first time or in additional product ranges for the first time and have been impressed by the simplicity and convenience."

However, this is not bad news for Swiss retailers. According to Lang, retailers do not have to expect to lose market share to large international players such as Amazon. "With the exception of fashion, online retail in Switzerland is very much in Swiss hands," says Lang. In addition, the latest figures from the industry association SAAM show that Swiss online retailers have recently regained market share for the first time. (SDA)