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.
As the owner, however, dealing with this onslaught is not enough. You also must be looking ahead. No one expects you to have all the answers. But to instill confidence and reassurance, you must have a plan. It is time to be proactive. And for that, The ROI is here to help you...for free! We have an array of self-serve resources and tools available precisely for uncertain times. While some are always available to every visitor to The ROI site, others are from our Members Only collection, including the special section in the OWNERS Center focused specifically on "Weathering a Crisis." Given the present circumstances, we are making all of these available to all of you, free of charge. We urge you to take advantage of them. And tell your fellow retailers about them as well. We are all in this together. And we will get through it together.
After months of doom-and-gloom headlines and hand-wringing about a recession in 2023, headlines last week (quietly) said this: "What Recession? Some Economists See Chances of a Growth Rebound." One economist, in fact, seemed a little chagrined to note "So far, the U.S. economy has proved unexpectedly resilient." *
Retailers must be mindful of all this as they make their business and buying decisions throughout the year. But the macro economy is simply interesting, but not significant. Your local economy is, of course, what really matters. In that context, every savvy owner uses these three steps.
That's a sign of the times, isn't it? While retailers are more accustomed than most folks to cope with change, 2020's unrelenting flexibility tests have been a challenge. Forget about five years. Retailers have to be ready for the next five months! It's back-to-school and then Holiday. The only certainty about the next five months is that they will probably feel like the past five months. Yet you still must run a retail business. And that means you still must buy and sell merchandise. The opportunities – and the pressures – are mounting.
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.
YOUR GOAL: QUICKLY GET TO A FIRST DRAFT. Face it. Sales are dropping. By how much? For how long? Nobody knows for sure. But, you can make some assumptions, some educated guesses. Put those into the 3-in-1 Cash Flow Calculator.
These totally volatile times cause a lot of opinions and fears to be swirling around. Seeing "what if...?" can be very helpful. All in just minutes. On your own.
The Retail Owners Institute® has developed a retail strategy for "Inventory Management Going Forward." As we often do, it was recapped as an unassuming chart (see above) identifying the Five Stages of Merchandise Mix Management, from "Before COVID-19" to the "New Normal?"
Let's assume your stores have been closed for weeks now.
We recognize how conscientious you are. So, after paying what you can to your employees (and yourself), the next most-worrisome dilemma is your rent.
As you likely have discovered, a common choice for many landlords is to offer to defer your payments. But that means taking on more debt, as those payments are only being postponed to a later point in time. You need a better solution than that.
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