In the next twelve months we all face many unknowns. Unknowns are problems in their own right because being ‘unknown’ makes it very difficult to plan and act, we can at best be prepared to react.
What we can plan for are the ‘knowns’ .Retail analysts , much like most other analysts aren’t necessarily the best indicators of things to come ,but you can’t avoid their historical data.
U.K. Retail sales in December were apparently down 1.6%, this was against an uplift in November. Whereas, the total figure (including online) is not clear , it is very evident that footfall is down. Springboard , a retail data analyst states that there was a fall off 20% in the footfall in shopping centres for the New Year sales.
There could be a whole bunch of reasons for this but what is clear there appears to be less people going out to shop and then they are spending less . Again, this has to be taking into context and considering a number of factors, such as online, changing habits , lack of confidence, ‘don’t need anything’ syndrome, and a mistrust of retail ‘sales’; to name a few.
Backed up against this there have been reports from some retailers, which were surprising. Waitrose ended with Christmas figures better than expected and even Marks & Spencer’s experienced like for like growth and that was with clothing as well as food . In fact, according to the Kantor World Panel half a billion pounds (wrote this as I don’t the number it equates to, nor did the journalist who originally reported the figure). So the figures don’t really equate, percentages down, figures up . What do we believe?
Whatever the real picture there are two ‘knowns’ on the retailing horizon, inflation for the consumer and rising costs for the retailer (living wage being one example). Both of these are financial sponges. They suck money out of the people’s pockets. Yet, even if there are these storm clouds and consumer spending is hit, our fellow consumers will spend approximately £300 billion per quarter (Office for national statistics)! A load of money by any standards. Any good retailer’s first priority is to ensure that they get their share of this .
Now in expressing my opinion I may part company with the odd reader ( it maybe all, as ‘the odd reader’ may well define the total number of readers). The retailers that survive and prosper are those who are innovative and progressive. Those who are over cautious , are most likely to suffer. The ‘cut back on stock, not try anything new, just sell what we have always sold ‘ brigade , just won’t sell enough. Sticking to what sold yesterday, is not tomorrow’s template. The consumer has and is changing, they will expect the retailer to change. If they walk into the store and it is not well stocked and there are not new and fresh products, they may not come back so often or worse still they may not come back at all. This , in itself, is hardly a new approach but is ever more important. Consumers expect and demand new offerings.
Julia and I have just come back from a trade show in the States and we visited some party stores as well. Yes, that great big mega consumer society, suffers from similar problems. We saw at first hand, the difference between well stocked, big choice ,good customer service and the opposite. The difference being customers. The former, obviously, had a lot more(the same day,an hour apart) than the latter , of everything.
Retailers, who started during the financial crash understand the need to innovate. Those who are longer established , tend to err on the cautious. Perhaps ‘cautious innovation ‘ is a path.
It requires a great deal of boldness and a great deal of caution to make a great fortune, and when you have it, it requires ten times as much skill to keep it.
Ralph Waldo Emerson (19th American philosopher)
What won’t work is battening down the hatches and hoping yesterday’s plan works tomorrow.
Trump is one of the many unknowns. We have no real idea whether his Presidency, will have any effect on us. As is the case of Brexit, it is a complete unknown, as we don’t what it is or will be. We need to deal with what we know…who knows maybe aliens are coming ..that will sort the wheat from the chaff.