Brick and mortar shops are here to stay, says CEO of retail analytics company Trax
Joel Bar-El, co-founder and CEO of Trax believes the changes to our shopping habits, brought about by Covid-19, are just temporary
Trax has offices in 20 countries and operates in 87 locations. It has raised $370 million to date and its last funding round was made at a valuation of over $1 billion, making it a unicorn. According to Barel, the company received three acquisition offers and has turned them all down. “The next step is to go public,” he said, “that is the exit our stockholders are after and, for us, it is a milestone in becoming a bigger company.”
Even though Trax operates in an industry that remained in operation throughout the Covid-19 crisis, it was still affected and was forced to cut back on around 10% of its global workforce. “For five or six consecutive years we doubled our annual revenue and kept hiring in anticipation of this growth rate,” Bar-El said. “But, when Covid-19 came, we realized our growth would slow down and decided to make adjustments to our team accordingly,” he added.
Bar-El believes most of the changes to grocery retailers, which were brought about by the crisis—for example, consumers making more online orders and spending less time in the store—are only temporary. “A big portion of a brick and mortar retailer’s business model has to do with impulse buying,” he said. “People go into the store and 40% of what they buy is products that catch their eye at the register or that are on sale,” he added. The pandemic made people want to go in and out of stores as quickly as possible, Bar-El said, so these elements became less crucial but they are now going back to normal.
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