REDUCED MARGINS: THE FUTURE OF RETAIL

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by Stephen Humburg @ LinkedIn

Multi-Unit Retail Professional

With costs going up, customers demanding all of service, convenience, and price, and multi-channel competition increasing, savvy retailers are learning how to be hyper-efficient and are learning to live off of heavily sacrificed margins. This is more than a ‘fad’, it is indeed the future of retail as the demands for the retailer’s investment to get sales continues to grow.

These demands include, among others:

  • Precise Information/Self-Service. Information is now so readily available, and will only become more available moving forward. Customers want, and will increasingly want, the best information available in a nice, well-merchandised format WITHOUT person-person interaction.
  • Price. With multi-channel visuals of price splashed about and indelibly written on the customers’ consciousness, expect the customer expectation of the lowest price seen (or darn close), to increasingly be the price the customer is willing to pay.
  • Customization. Whether it be size, color, personal design, or all of the above, consumers will demand more immediate solutions to customize and differentiate their purchases.
  • Availability. Customers ‘see’ the virtual product everywhere in ads and online. The inherent belief is that the product is available everywhere. With that, the customer of today expects the product NOW, when the purchasing decision is made. Even if the best price, service, etc. are found by a customer, availability will sway most purchases.
  • Delivery. Whether purchased locally online/by phone, in store on larger purchases incapable of customer-vehicle pickup, or even online at a distance, customers are will expect both CHEAPER (or free) and MORE PROMPT delivery.
  • Sales staff. Yes, even with the vast majority of customers increasingly asking for better ‘self-service’, customers will also expect prompt and informative company contact on demand. Whether that be an available in-store associate or on-line agent, the demand for NOW will continue to include a readily available, knowledgeable, friendly staff member.
  • Payroll. Demand will continue to provide more on the course of ‘living wages’ for all levels of employ.
  • Environmental/Human Rights Issues. Growing more and more important in the minds of customers will be the action of companies on becoming more environmentally responsible AND in dealing with provisions for their direct and indirect workforce from raw material collection, to staff, to end user.
  • Marketing. With ever-growing channels of retailing, companies will struggle to find cost-effective traffic marketing.

 

The success of any retailer in this reduced-margin world will all the more depend on their abilities to deal with any and all of these fluctuating demands, to quickly react to product trends and new technologies…retaining a status always on the edge of ‘new’, to create a dynamic, mobile, responsive, and responsible supply/production chain, and to maintain a highly engaged employee pool.

Stephen Humburg has been a retail management professional for 30 years. He prides himself on his ability to take people to new levels of engagement within an organization to a realized goal of developing a unified team that provides over-the-top customer experiences. Connect with him today via invitation to stephen.humburg@gmail.com

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