Feedback Here

fbook  tweeter  linkin  google

Global contents also translated in
Chinese

It’s time for American retailers to put their act together to boost sales

"A recent Credit Suisse report projected around 8,600 brick-and-mortar stores will be forced to shut in 2017. While retail store visits have drastically reduced in recent years, it is about time for companies to leverage their store presence as a driver for customer acquisition in the digital space. However, in a stark contradiction to this, another research by Smarter HQ found 50 per cent of millennials actually prefer to go to a physical store as their primary means of shopping. In such a situation, a seamless omnichannel presence is what retailers should aim at."

 

 

Its time for American retailers to put their act together to boost sales

 

A recent Credit Suisse report projected around 8,600 brick-and-mortar stores will be forced to shut in 2017. While retail store visits have drastically reduced in recent years, it is about time for companies to leverage their store presence as a driver for customer acquisition in the digital space. However, in a stark contradiction to this, another research by Smarter HQ found 50 per cent of millennials actually prefer to go to a physical store as their primary means of shopping. In such a situation, a seamless omnichannel presence is what retailers should aim at. But what are the real issues plaguing the fashion retailing? Let’s find out…

Reducing footfalls

Its time for American retailers to put their act together

 

Currently, there are about 1,200 malls in the US, which are predicted to fall to about 900 in a decade. A research by Cowen and Company reveals between 1970 and 2015, the number of malls in the country grew twice the rate of the population. Add to that, the US also has one of the highest shopping space per capita in the world — 40 per cent higher than Canada, five times more than the UK, and 10 times that of Germany’s. Besides having omnichannel presence with features such as Buy Online and Pick Up in Store, these companies should also renegotiate leases and optimise their store footprint by closing underperforming stores.

Low margins in e-commerce

On the other side of the spectrum, increased expenses in delivery and marketing are eating up e-commerce retailers’ margins big time. Towards this, retailers need to undertake other cost-saving measures to reduce additional margin pressure. This can be reducing the markdowns, as sales of full-price items would have higher margins. A highly promotional environment has also harmed many apparel retailers, making customers accustomed to discounted merchandise. But it isn’t going to be easy either with the onset of holiday season, people tend to wait for promotional offers all the more.

Improving speed to market is another alternative just as H&M, Zara, and Uniqlo have been doing. These retailers move styles from the runway to the stores within weeks, constantly evolving their assortment and keeping their products fresh. Analysis conducted by John Thorbeck, chairman, Change Capital LLC, and Professor Warren H Hausman of Stanford University indicate retailers can increase their profits by as much as 28 per cent and market capitalisation by up to 43 per cent if they are able to reduce their lead times and respond faster to changing consumer demand. In the long term, American retailers will be unable to compete with fast-fashion retailers if they don’t address this issue.

 
LATEST TOP NEWS
 
 
MOST POPULAR NEWS