Perspectives

From The Co-Founders

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Tips, Tactics & Strategic Insights and Commentary
from The ROI Co-Founders, Pat Johnson and Dick Outcalt
Outcalt & Johnson: Retail Strategists LLC; Retail Turnaround Experts

Retailing is so great. Every retailer is an optimist, a people-person, and a bold risk taker. (We know; been there, done that.) Every retailer wants to get their stores re-opened, and their staff people re-employed. 

Granted, there are many arguments, pro and con, about "Re-Opening the Economy." And in a number of communities in the U.S. and elsewhere, some re-opening of stores and restaurants is occurring. ​​

COVID-19 thumbs/MdseMix v2.png

Customers have become very tentative and “prone to thrift”, as the economists say. As the economy reopens, the lowered sales demand drastically reduced inventory levels. 
  • However, as the inventory quantity is reduced, the new imperative is the mix of merchandise. 
  • Discretionary spending will lag; retailers must expand and feature the basics, the “never-outs,” like never before. 
Here are our BIG PICTURE thoughts on the stages that might unfold.
  • Total inventory levels must be reduced, especially at first, and then grow over time as sales levels return.
  • Importantly, the MIX of merchandise must change. Significantly!
     

Each of us, our households, businesses and communities are in different stages of shutdown due to the coronavirus.

While we cannot speak to when this will end, we do have some ideas for dealing with the "fog of uncertainty" that hangs over us all.

Remember thinking that Amazon was the most disruptive force to happen to retailing? (Well, at least since Walmart was the most disruptive....)

However, the coronavirus pandemic eclipses them all. No matter where you live or do business, it is not whether, just when, COVID-19 will impact your life. Disruption with a capital D!

There's little that any of us can do to address the public health crisis of the pandemic. Its impact on people and businesses is a widespread and major jolt, akin to the shocks of  9/11 and the 2008-09 economic meltdown. 

Even as painful and disruptive as the pandemic is at this moment, we must remind ourselves that it will subside. It's not whether it will subside, just when.

But all of us are going to have to deal with the ensuing economic situation, and its effects on our sales, our customers, our employees. 

These are difficult times for us all. Retailing in particular is under enormous stress. Many feel like there are no good choices. 

But, there are good decisions. And The ROI is dedicated to helping you be able to make those good decisions for yourself. 

Retailers, it’s time to be proactive. 
In the midst of this unprecedented and unsettling Coronavirus pandemic and its disruptions of daily routines, you are (or will soon be) in the midst of a whirlwind. 

As one person observed, "It's like walking a tightrope in a hurricane." And with the changes that seem to occur at an ever-faster pace, every day can feel like whack-a-mole.

Alas, there is really no way to avoid discussing COVID-19, the coronavirus that began in China last month, and now continues to spread throughout the world.

No matter whether or when it is officially declared a "pandemic," the uncertainty and angst that it is generating have troubling implications for retailers.