We’ve said it before – retail isn’t dead or dying, it’s evolving. Yes, store closures are coming fast and we’re already on track to surpass last year’s record, but the future of U.S. retail isn’t as dire as some would have you think. Some brave retailers are actually opening more stores as others struggle to evolve.
The reality is that retail is flourishing – from online shopping to specialized small format stores. Certain segments of the retail market are being impacted more by changing consumer tastes and behaviors because they aren’t evolving to meet the demand. If sporting goods, department stores and specialty retailers don’t embrace change and innovation, they could become just another tick for the tally of closures.
Consumer behavior has always driven change within the retail community, long before ecommerce took over. With 80 percent of the U.S. population living in urban areas, convenient shopping experiences are more important than ever. Retail powerhouses like Amazon, Target, Walmart and CVS are adapting by opening small format stores with reduced physical footprints and specialized stock to meet these needs. Sales at small format stores are already projected to grow almost 4 percent annually in the next four years, so now is the time for other retailers to consider a similar approach.
Unlike the megastores we’ve grown accustomed to, these small format stores are aimed at younger shoppers in city centers – often placed near university campuses or other suburban hubs – and designed for quick trips to pick up essentials. For retailers, this means getting inventory levels exactly right to meet specific customer needs. To do this, retailers need to bring their sourcing processes into the digital era and enable true collaboration among their community, making better, more profitable operation decisions faster.
Digital sourcing provides retailers and partners with a single platform for communication, collaboration and inspiration sharing, no matter where they are in the world. With a fully integrated system, retailers can speed time to market, stay on top of industry trends and ensure the right inventory is in the right place, at the right time.
A platform that automates information-gathering and decision-informing processes also means that retail sourcing professionals can save time for more creative pursuits, using reporting and forecasts to build more accurate orders their customers will love. Anticipating and acting on shifting consumer needs is more crucial than ever as retailers adapt to survive the New Retail Economy. With technology that provides real-time data and analytics, and improves communication across the community, retailers are better equipped to adapt operations to understand and take advantage of shifting consumer preferences.
Learn more about Digital Sourcing in the New Retail Economy in our eBook.