You've no doubt seen the headlines and the commentary:
Consumer spending is up, but not on what was expected, especially those publicly-traded chains that must report quarterly.
Even the time-honored practice of discounting isn't as effective as it once was, according to some.
And then there's this: As noted in American Business Journals, "According to a study of more than 24,000 customers by Accenture PLC, 88% of executives believe customer desires are changing faster than they can change their business." And that's really the issue, isn't it? Who is best able to cope with and adjust to this new/fickle/volatile environment?
We have more confidence in the latter. But even having a full complement of good judgment at the ready can be small comfort amidst today's pressures for retailers. Cash flow is affected by lagging sales of spring merchandise; vendors press for ever-earlier orders and shipments. And the customers continue to be their unpredictable selves. It has been a long time since anything felt like "normal." Indeed, some have suggested that those yearning for the "New Normal" need to change their expectations; time to prepare for the "Never Normal!" "Never Normal", eh? Just another day for independent retailers! ---- * Retailers Stumble Adjusting to More Selective Shoppers , Jordyn Holman, New York Times, August 19, 2022 ** Consumers Uneven Spending Fuels Caution Among Retailers, Annie Gasparo and Theo Francis, Wall Street Journal, August 1, 2022
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.
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!
That headline from Chain Store Age* brings smiles to retailers. Consumer confidence is a key indicator of retail sales, and this increasing confidence as we head into the holiday season is very welcome indeed.
But of course, there is no one-size-fits-all upside here.
It's a given that your sales volume is a very big deal. Granted, you are analyzing it every day. But here's a slightly different approach which you may find very revealing. Let's start with a couple truisms. The definition of retailing is “selling to the ultimate consumer.” Retailing also is having "the right product at the right price at the right place at the right time for the right customer." But, as retailers ponder how best to manage sales in the current consumer environment, does it really matter whether their "right customers" buy from them in-store or online? Actually, it might! And here’s a simple, free "pilot project" to find out a little more.
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