Retailers, Is The End Near?
Thursday, October 12, 2017

Categories: Market Research

Retailers, Is The End Near?

We’ve all heard the rumors and the “fake news” – the Retail Apocalypse is near! But fortunately, for us all, this is WRONG. A recently released report, “Debunking the Retail Apocalypse,” from industry analyst firm IHL Group, demonstrates exactly what is happening in the retail industry and what retailers need to do moving forward.

Good News: The Retail Industry is Growing

Retailers and restaurants are opening 4,080 more stores than they are closingThrough the analysis of more than 1,000 chain retailers, including restaurants, with 50 or more locations, IHL found the following. “Retailers and restaurants are opening 4,080 more stores than they are closing, and retail sales through July 2017 are up over $121.5B from the same period a year before”. Of those 4,080 net openings, 1,326 of them were in core retail segments. In addition, online retail, which still only represents a small percentage of total retail, is also experiencing growth.

Of course, some retail segments are doing better than others. Mass merchandisers, convenience stores and supermarkets are leading net store growth.  Of those leaders, Dollar General, Dollar Tree and Seven Eleven are leading the pack. However, specialty soft goods and department stores are experience the most closings. Retailers experiencing the most closures include Radio Shack, Payless ShoeSource, Rue 21, ascena retail group (which includes dressbarn, maurices, Justice, Lane Bryant, Catherines, Ann Taylor, Loft and Lou & Grey) and Gymboree.

Bad News: Retailers Can’t Sit Back and Do Nothing

Consumers won't let it slide when retailers are temporarily out-of-stock

Despite the fact that the retail industry as a whole is growing, retailers aren’t in a position to sit back and relax. Going forward, IHL outlines six things retailers must do in order for the industry to continue to experience the growth we’re experience in 2017. The initiatives are:

  • Improve the Experience: With the prevalence of online retail, consumers need a good reason to come to your store. To improve the in-store experience, IHL recommends that retailers invest in people and ambiance. Make sure that people want to shop there.
  • Attack Out of Stocks: Today, given Amazon’s endless aisle of available items, consumers won’t let it slide when retailers are temporarily out-of-stock. Retailers need to invest in technologies to ensure inventory levels are accurate.
  • Decouple IT Spend Growth: This is where the old adage, “You need to spend money to make money” comes true. Retailers can no longer tie IT spend to the previous year’s revenue. Instead, retailers need to make significant investments in technology to transform their businesses.
  • Leverage the Cloud for a Jumpstart: With cloud technology, retailers can rapidly transform their retail businesses. IHL recommends starting with a hybrid cloud approach. It provides a single view of inventory and of the customer across channels.
  • Embrace Mobility: IHL’s research found that leading retailers embrace mobility for both customers and associates. These leaders are significantly more likely to empower associates with mobile devices and process transactions with mobile POS.
  • Follow the Leaders: IHL’s final tip is do what the retail leaders are doing. IHL says that winning retailers not only embrace mobile, but also prioritize IT transformation. More so, they are focused on lowering supply chain costs, value associate training and tools, investments in inventory visibility and employing clientele and assisted selling.

 

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Good News: OrderDynamics is Here to Help

We have even more good news for you! OrderDynamics can help retailers tackle each of the items on IHL’s prescribed to do list. Here’s how:

  • Improve the Experience: OrderDynamics helps you create a positive customer experience through omni-channel fulfillment capabilities such as click and collect. Click and collect gives you the opportunity to create an inviting space for shoppers to pick up their orders. Not to mention to be able to engage with friendly, knowledgeable store associates. With any luck, this positive experience encourages the shopper to make additional purchases while in-store.
  • Tackle Out of Stocks: Inventory visibility and order routing will help you, and your shoppers, take advantage of your existing stock no matter where it may be. With inventory visibility, consumers can ensure an item will be on the shelf once they arrive at their shopping destination. By routing orders from the closest store or distribution center with the most availability, order routing helps you make the most of existing stock.
  • Decouple IT Spend Growth: By investing in technologies such as a Distributed Order Management (DOM), you can be on the road to experience growth and outsmart your competitors.
  • Leverage the Cloud for a Jumpstart: The OrderDynamics SaaS-based DOM makes it faster and easier for you to get up and running, start fulfilling orders and achieve omni-channel success. This solution also checks both IHL’s boxes for providing a single view of inventory and of the customer across channels.
  • Inventory Visibility will help you take advantage of existing stock, no matter where it may be. Embrace Mobility: OrderDynamics’ DOM not only drives mobile shopping but also offers associates the ability to access inventory and order information from the convenience of a mobile device or tablet.
  • Follow the Leaders: The many benefits of OrderDynamics DOM can help you not only follow industry leaders but enable you to become a leader in the industry too.

It’s Time to Make a Change

As IHL concludes, “Retail is not dying, but it is changing”. Unless you are one of the aforementioned “retail leaders” who are doing everything right, it’s time to make some changes. Fortunately, OrderDynamics can help you make a number of these crucial changes with the help of our advanced, out-of-the-box DOM.

 

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