Does retail really need a reset?
Deloitte is out with an industry report that identifies key points of the Great Retail Reset. But is a retail reset necessary? I believe no, but some areas or improvements need to be made.
Deloitte reports that 83% of retailers invest the most heavily in employee recruitment and retention, and 74% of executives expect shortages in consumer-facing positions this year. More than half of leaders believe that staff-free stores will be common within the next five years.
Another main area of change and opportunity is in the highly-publicized supply chain. As the report summed up, “resets don’t happen overnight. But retailers can’t afford to wait given that 80% of executives we surveyed believe consumers will prioritize stock availability over retailer loyalty in the upcoming year.”
So let’s think about these…
Staff-free stores — In Japan staff free stores are pretty standard because Japanese consumers tend to be very honest, but here in the US, free stores are going to lead to a high level of shrinkage. I don’t see many staff-free stores here.
Supply Chain Issues — It may be hard to fathom but supply chain issues will subside. If vendors can’t improve their supply chains, they will be replaced by vendors who can provide stock. Retailers also can replace national brands that are in short supply with private label products.
Retail staff shortages — Retail staff shortages are expected to improve as employers offer better pay and more benefit packages. Walmart is offering to pay employees’ tuition costs. People don’t need jobs right now, because there aren’t any available, but that will change when the government ends its benefits programs.
Where will resets be needed?
1ne: Better merchandising — Target is booming because their stores are merchandised so well. Kohl’s, on the other hand, tends to be a mess. Stores need to be bright, well-merchandised with wide aisles.
2wo: “I need help here” — Retailers have to employ people who are willing to help people and knowledgeable about the merchandise. If you’ve ever needed help at a Home Depot, you understand what I’m talking about.
3hree: Better data equals a better assortment — Retailers need to be more proactive when removing products that don’t sell and adding new products faster. Nothing is more infuriating to consumers than seeing a new product advertised in an FSI when their grocer doesn’t yet have stock.
4our: Get customers in and then get them out — People don’t have time for lines at checkouts. Self-checkouts, like the ones added at Costco, is a possible answer.
5ive: Invest in digital but understand its limits — Yes, e-commerce sales are increasing, but in-store purchases still tower way above e-commerce sales. Many people prefer to shop, in person, for some items.
Now is a great time to prioritize the customer experience and prepare for the post-pandemic shopper.
Originally published at https://www.newmediaandmarketing.com on February 3, 2022.