Brick-and-mortar retail is fighting to survive in an unprecedented environment. As a result, savvy retailers are turning to partners like Relogistics to help increase efficiencies while saving money. Relogistics recently added onsite pallet management services at two new locations for a major national retailer, as well as similar services at a new location of a well-known dollar store retailer. Relogistics also added seven onsite locations for pallet services, as well as reusable container and recycled content management, for one of the country’s largest electronics retailers.
Whether you believe the retail apocalypse is imminent, or you think retail is just finding its way through an evolution, there’s no denying that brick-and-mortar retail is changing. Some of the statistics are grim. As of early August, there were already more than 7,600 retail closings in the U.S. in 2019. That exceeds the 5,864 from all of 2018, according to research from Coresight.
Still, there are some encouraging numbers that often get lost among the doom and gloom. For example, IHL claims just 16 retailers are responsible for 73% of U.S. retail closings, and that for every retailer closing stores, five are opening new locations.
Some retailers are clearly weathering the apocalypse better than others, and those companies tend to share a few common characteristics. What can retailers take from their playbooks to stay relevant in this volatile environment?
Reinventing the Experience
A key to getting shoppers in the door is creating an experience for them. Thriving retailers are those who have reconfigured their layouts and designs to meet the demands of modern shoppers. At the forefront of this movement was Apple, which made its retail outlets so popular by creating a place people liked to hangout and explore.
Another idea gaining momentum is putting stores within stores. An example from recent headlines is Disney agreeing to place branded stores with certain Target locations. Such collaborations allow retailers to revitalize their brand while offering convenience to shoppers. The shops within the stores allow brands to save overhead from opening a full retail outlet. Best Buy has also explored this route with Samsung, and JCPenney and Sephora have also made store-within-a-store arrangements, among others.
Embracing Omnichannel
The Amazon effect is in full effect. Online shopping continues to grow in market share, though it still only accounts for less than 12% of overall retail sales. Successful retailers will be those who understand how to integrate brick-and-mortar locations with e-commerce.
Shoppers still love to see and hold merchandise before purchasing. Retailers like Best Buy have adjusted to this by focusing their outlets on letting shoppers use, touch and explore merchandise, while still offering a robust online shopping offering in the event shoppers aren’t ready to buy in-store.
The omnichannel experience of showcase-and-ship will be necessary for any retailer to survive long-term.
Cutting Costs
Running a retail operation isn’t cheap. There’s rent for physical outlets, staffing and shipping costs, inventory management, and more. In short, there are a lot of moving pieces. Maximizing the efficiency of some of these operations is paramount, especially in an era where shipping and warehousing have become primary tactical advantages for successful retailers.
That’s where outsourcing some of these tasks to specialized partners can really pay dividends. Certain aspects of the supply chain simply aren’t core competencies of warehouses and distribution centers. Processing pallets and containers in these facilities can be burdensome and slow down your operations.
As a result, savvy retailers are turning to partners like Relogistics to help increase efficiencies while saving money. Relogistics recently added onsite pallet management services at two new locations for a major national retailer, as well as similar services at a new location of a well-known dollar store retailer.
Relogistics also added seven onsite locations for pallet services, as well as reusable container and recycled content management, for one of country’s largest electronics retailers.
These organizations all recognize the need to run lean warehousing operations, and have found value in the services Relogistics offers.
Competing in retail these days means far more than offering the best selection or the best prices. It means understanding your customers, understanding the changing dynamics of shopping, and recognizing how to do it as efficiently as possible.
If you want to have a competitive edge in today’s retail environment, ask us how we can help your business cut costs, increase efficiencies and help you come out on the other side of the retail apocalypse as one of the winners.