About a year ago, as the pandemics were beginning to hit their stride, we introduced a framework for retailers to "rethink your merchandise mix."
As depicted in the chart above, we cautioned that once the lockdown was over, as customers resumed shopping, retailers should be prepared for (1) reduced sales totals overall; (2) significantly re-balanced merchandise mixes, initially dominated by "basics/never-outs."
Further, we anticipated that the merchandise mix would continue to change as we re-emerge from the effects of the pandemics. And we urged retailers to take this overall construct and adapt it to their own situation; to develop their own customized strategic response.*
Now, one year later, here's how this can become "news you can use" to quickly produce your Big Picture buying plan. Especially in the spring of 2021, some practical answers to "What to buy?" , "How much?" and "When?" are likely to be very welcome.
Isn't it great? Headlines and the media world seem to be in unison; the dastardly COVID pandemic is being arrested. And, if we can believe the pundits, pent-up shoppers are about to buy all sorts of products and services with abandon. But, will they? Given this exuberance, many retailers could be building up excess inventory. Retailers once again need to be true merchants. That is, the #1 responsibility of retail senior managements must always be to control inventory. (It's the only thing that makes money, but it soaks up cash.)
As we approach April of 2021, the question for retailers is "Now what?" Having survived 2020, in many cases on guts and guile, we must now focus on how best to survive 2021 and beyond. As having one foot on the dock and one foot in the boat, the future of retailers in that Red Zone is not a pretty picture. Granted, there is much talk about the expectation that "convenience" will become a major factor for shoppers going forward. And we don't disagree.
Here's the deal: We see that this has brought heightened awareness of two different retail strategies: Convenience Retailing versus Destination Retailing.
The just-released "2021's Main Street Business Survivor Study" from the Pandenomics series conducted by the PYMNTS.com folks* focuses on the "Main Street Survivors:" those small to medium sized businesses "that have weathered the pandemic's fallout."
Vital lessons. What have these "survivors" done differently than the rest of SMB businesses? Here are the major findings of their study. We think that you'll see many of the survival steps you have taken, or be prompted to adopt some others.
Have you noticed? From the growing Shopify online businesses, to an array of pop-up shops, mobile "fashion trucks," or newly-repurposed spaces in neighborhood shopping districts, there are many new retail operations emerging. They're actually springing up! Plus, there are the established retailers who, having shed many legacy features, are re-imagining their place in the ("Coming soon!") post-pandemic environment.
As we noted last week, retailing is being affected by different patterns of seasonality. The old timing patterns for ordering, seasons, and events no longer apply. New "Rhythms of Retail" must be established by all retailers. So it was with great interest that we read a blog post about Pop-Up Retail: Not Just for Start-Ups.* It featured results from a recent study out of the UK suggesting that "the pop-up retail sector is growing at 12.3% per year. And the U.S. pop-up industry has grown to approximately $10 billion in sales."
As we know all too well, 2020 was chock full of "disruptions." Every week brought a new flexibility test. And those of course did not go away when the calendar turned. For instance, here we are on President's Day Weekend and Valentine's Day Weekend. Raise your hand if you were able to plan and carry out your "traditional" promotional events, let alone do something for your Valentine. That's what we thought. The usual patterns just don't apply anymore.
Boy, are we ever impressed. We've known for years that those who are following and/or involved with The Retail Owners Institute® are resolute, hungry, and determined. But wow! The challenges of the last year have brought out the very best in many of you. We've heard back some of the most resourceful survival stores that we've ever heard. Here are just a few examples:
Incredible value! 👀
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