COVID-19 Considerations for Specialist Retailers

04 May COVID-19 Considerations for Specialist Retailers

As industries all over the world aim to manage their way through COVID-19 and grapple with their in-flight strategies, businesses need to balance managing the ongoing situation with preparing for their future journey post COVID-19.  Our focus here is on non–essential specialist retailers which is an area which Island Pacific has operated in for over 40 years.  We ourselves have formulated approaches aiming to assist existing customers and future ones with retail solutions to support them traversing the unique obstacles that this pandemic has posed for global retail.

In Flight

Right now, specialty retailers focus on operational areas of their business, physical outlets, staff and customer welfare, ecommerce capabilities, supply chain and ever-changing global, government stipulations.  Below is just one example – inventory management for the specialist retailers which is a key area for many of Island Pacific’s customer base.

Retailers are dealing with many inventory management issues such as:

  • In-season stock which is on order, in-situ, sitting in supplier’s warehouses, retailers own warehouses or closed stores.
  • Future season stock and what to do with future orders.
  • The capabilities and performance of its e-commerce platform and the % contribution to their business with anything from 0-100% currently and how that might change. In many cases e-commerce is helping specialist retailers sustain their business. Dealing with the challenges of social distancing in warehouses, the volumes of orders, increased web traffic from lockdown consumers.  Communication of longer delivery times
  • Planning for the world post COVID-19, where they will be in their season? Either in their home country or in the countries they sell in and indeed where their suppliers reside and where the stock has to travel from and to reach them.
  • What the future will bring if there is a second outbreak and if so where and the impact on their supply chain and what can be done to prepare for a second wave.

Key Focus Short Term

  • Housekeeping
    • What needs to be in place when we come out of post lockdown have we done general housekeeping to ensure that when the green button is pressed we are ready to go?
  • Employee Protection
    • Protecting our employees in a post Covid-19 world, what could that look like? what will need to be in place?
  • Channel & Store Mix
    • Evaluation of channel and store mix versus stock mix. Aim to distribute to the stores which have the higher propensity to sell.
  • Product Categories & Product Performance
    • Evaluate product categories and individual products. Review each product in the portfolio for longevity versus liquidation and generating cash and make plans to distribute them accordingly
  • Review Previous Technology Initiatives versus Future Technology Initiatives
    • The unprecedented times of this pandemic means that industries are forced to review their infrastructure, processes and technology, identify what issues are blocking progression in a specific area and preventing agility to react to current and upcoming challenges.  Consider from an inventory and supply chain process what improvements could be made to make a difference and help the business capitalize on future opportunities and manage the way through the current situation.
  • Inventory Management & Supply Chain. What Is Good? What Is Bad? What Will Make a Difference?
    • What could be improved, decide on the ranges you should stock in stores and to optimise volumes across styles colors and size mix?
    • Stock visibility and performance – how easy is it to view stock visibility across all channels and its performance?
    • How easy is it to sell to your customers from any channel in the manner they prefer?
    • Is your customer proposition optimal?
    • How easy is it to move stock around?
    • How easy is it to work out if its economically viable to move stock around?
    • Are you able to forecast which products will be strong performers and to react quickly?
    • How exposed is your supply chain to a particular country or economy? Aim to ensure that your sourcing is stretched across different countries in order to spread risk
    • How quickly can you communicate with your supplier base?
    • If you have a franchise and wholesale model, how quickly and effectively can your customers communicate and order stock?
    • Focus on your core consumer understand their purchasing habits. How are they changing now and monitor closely to see how they will continue to change. Avoid making assumptions.
    • The current lockdown has impacted society and lifestyle and will continue to change. BCG predicts* that much will continue to change and some will remain unchanged post COVID-19. Plan for how this could impact your business, monitor, re-evaluate and adjust.

Go Forward Strategies

  • Change Management, Reflection, Adjustment & Action
    • Be ready, plan and position the business to be agile to meet future challenges and to adjust plans according to changing circumstances.
  • Analyze your Exposure
    • Look at your exposure by country and economy. Take a look at BCG* report. As we know, each country has taken a different approach to dealing with lockdown which will ultimately affect how they flatten the curve, fight the virus and the future of their economy
  • Communicate Strategy
    • Don’t underestimate the impact of mindset and approach. Look at the whole picture and look at what you can impact today and in the future. PRIORITISE challenges and communicate throughout the business. Determine your strategies and communicate them to your team to ensure everyone is pulling in same direction.
  • Keep It Simple
    • Focus on simplicity and flow of operations and ease of selling in all channels. Identify what is hampering the selling process and what strategies, processes and technologies you can put in place to help deflect this. Columbus** Highlights the following factors as key areas of focus which will continue to be part of our world post COVID-19.
      • Transforming customer experience
        • Curbside pick up
        • Contactless transactions
        • Delivery through stores, online, third party channels “a true omni-channel world”
      • Carry Out what if scenarios
        • What would make a big difference to your profitability and sales?
        • What would you need to do to make that difference?
        • How long would it take?
        • How much would it cost?
        • Focus on the areas which would have the most impact.
      • Ask Key Questions?
        • How Omni-channel are we?
        • Do we have one view of inventory across all channels?
        • Do we know our customer?
        • Can we easily replenish our stock where It is most likely to sell?
        • Can we simply allocate our stock where it is most likely to sell?
        • Can we effortlessly manage our open to buy and ensure it is assigned to the products and departments where it is needed most quickly and efficiently?
        • Is our ecommerce set up to deal with increased sales?
        • Are our store staff equipped with all the tools they need to quickly and efficiently increase sales?
        • Can we open up a new channel easily with current systems?
        • Do we have access quickly to key information to focus on the exceptions and drive the business forward?
        • How quickly can we communicate with our suppliers
        • How seamlessly can we communicate with our franchise & wholesale partners

 

Other Reading Material & Food for thought

https://www.retailgazette.co.uk/blog/2020/04/retailers-need-several-weeks-notice-to-reopen-brc-warns/



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