Supply chain disruptions and contamination concerns are two challenges the coronavirus poses to Chinese retailers.
According to a report in eMarketer, small-and-mid-sized brick-and-mortar retailers in China are especially being impacted by store closures and a reduction in foot traffic. While this would seem to create an opportunity for online retailers, virus-related disruptions in supply chain and shipping operations are expected to have a negative effect on Chinese e-commerce.
eMarketer now expects Chinese e-commerce revenue in 2020 to substantially fall short of the $2.328 trillion it forecast in December. Meanwhile, Chinese e-commerce giant Alibaba has said coronavirus will create a drop in first-quarter revenues.
Despite these broad e-commerce issues, online grocery sales in China have substantially increased since late January, when the coronoavirus outbreak was first declared in China’s Wuhan City. Chinese e-commerce retailer JD.com and French hypermarket retailer Carrefour have both reported sizable gains in online food revenues since the virus started rapidly spreading.
However, “contactless” pickup methods for online food orders, where customers remotely order and then pick up sealed packages of food without human interaction, are becoming popular.
eMarketer also reports emerging Chinese retail trends such as an expected 20% drop in Q1 smartphone sales (compared to an anticipated 5% decline across the globe), as well as the increased use of automated drones and robots to perform e-commerce deliveries.