By Nicole Leinbach Reyhle
I’m wondering what the holidays may look like due to continued inflation and global economic factors. Any thoughts here?
The National Retail Federation reports that many major retailers have seen worsening sales this spring and summer because of rising costs in gas, food, and other essential items. With this possibly being an indicator of the upcoming holidays, it’s great to plan ahead for a holiday season with additional challenges.
To help prepare, start by sourcing inventory with stronger margins. Having increased margins — even in just some items — can help make up for items that aren’t as profitable. Jewelry, accessories, toys, and many gift items are great examples of this.
Reach out to your vendors directly asking for these types of high-margin items, then begin to create holiday marketing strategies to help push these items specifically. Merchandising can help bring these items to the forefront of your customers’ attention. In addition, leverage social media and digital marketing, such as email, to help keep your store in their thoughts. Remember, though, your marketing efforts shouldn’t be just about selling more. It should be about giving customers reasons to shop with you. That will help them want to come to your store instead of someone else’s.
Supply chain disruptions continue to be a challenge as the world economy recovers from the COVID-19 pandemic. How do you suggest retailers adjust their inventory buying in response to this?
Being proactive in your inventory planning and overall retail strategy is a great help. This means expecting that delays will happen and disruption will occur, inevitably creating frustration. Retailers who plan for this can more confidently react to customer demands, delayed inventory, and even canceled orders.
The key will be to continually evaluate delivery times and have ongoing and honest conversations with vendors. Ask questions that include gaining a better understanding of where your inventory is being sourced from. The worsening supply chain pressures are driven predominantly by delays in deliveries from China and by a dramatic increase in both ocean and air freight costs. The Ukraine/Russia conflict makes the situation worse. Knowing where inventory is being shipped from before ordering can help predict delays.
In addition, businesses that don’t have enough vendor and product diversity are at greater risk, so it’s a good idea to add vendors from across various regions. The time you invest in finding new sources and spreading your purchases more broadly should pay off in more sales and less stress.
Finally, achieving a connected supply chain that delivers your orders to your business in a timely, anticipated fashion depends more on the decision-makers than ever before. Supply chain challenges won’t be overcome without leaders making the right decisions for their unique stores. So continue to think ahead to stay profitable.
Nicole Leinbach Reyhle is the Founder of RetailMinded.com, a well-respected retail industry resource that has been recognized worldwide for its leading business insight since 2007. Her work has been featured in Forbes, Entrepreneur, Business Insider, the UK’s Telegraph, CNN, the Today Show, and countless other industry resources. Additionally, she has supported American Express’s Small Business Saturday as a spokesperson and is the author of the book Retail 101: The Guide to Managing and Marketing Your Retail Business, published by McGraw-Hill. With a core concentration on small businesses and independent retailers, Reyhle welcomes you to connect via Instagram at @RetailMindedWorld and Twitter via @RetailMinded.
