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Let’s cut to the chase. We all know that the last two years have been a roller-coaster ride for retail businesses around the world. With their buyers spending months in quarantines, and the market experiencing a phased recovery in 2020 and 2021, physical retail stores have learned to recognize major changes in standard operating procedures and customers’ shopping behavior.
Retailers need a systematic self-assessment to pinpoint deliverables needed to help them survive and thrive in 2023. At this point, it is imperative for retail businesses to plan and invest in a retail management system that would allow them to prioritize and execute the retail transformation.
By gaining increased visibility into their supply chain and data-powered insights and forecasts, businesses will be able to develop new plans to counteract disruptions in customer buying behavior, determine optimal store footprints in different seasons, and brainstorm shopping experiences that customers will be looking for in 2023. Data will be a key player here and that can be derived by implementing a well-functioning and futureproof retail management system (RMS). Here are some questions retailers need to be asking themselves and using RMS capabilities to solve them to gain success in 2023.
Which channels can your product or service be purchased from?
With people continuing social distancing, retailers will be needing to offer customers new ways to buy in 2023. While e-commerce and omnichannel buying experiences will remain at the forefront, innovative methods of purchasing such as BOPIS (buy online and pick up in-store), third-party fulfillment (3PL), drop shipping, pick-up outlets, self-managed fulfillment, etc. will become increasingly popular.
92% of retailers already have a BOPIS system in place. Radical
Serving consumers who are concerned about their safety and health in the post-pandemic world will be paramount for all retailers. This concern will convince retail businesses to offer digitally-driven services such as curbside pickup options, contactless delivery options, online-ordering apps, and multichannel buying experiences.
A study published in Harvard Business Review says, 73 percent of all customers use multiple channels during their purchase journey.
Do you have ample inventory and an optimized supply chain to fulfill incoming orders?
It was observed that where on one side e-commerce sales were booming during the pandemic, on the other side the order fulfillment challenges were also becoming more pronounced. Customers witnessed numerous products going out of stock and fast delivery items reaching them after weeks. Statista.com revealed that by the end of February 2020, more than 30% of cough remedies went out of stock on all prominent e-commerce retailers in China. This highlighted that retailers were under constant pressure to improve in-stock and inventory services levels. In 2023, online retailers will be using a retail management system (RMS) to improve in-stock levels and simplify supply networks.
Are your fulfillment channels and operational processes optimized to ensure sustainable profitability?
Constant change demands that retailers also continuously rethink their operating models. How can retailers ensure that they continue to fulfill the increasing load of orders profitably? Businesses leaders must examine the store footprints, the need for skilled labor, and loopholes in supply chains. These findings and learnings should be applied to meet the prevalent demand while optimizing cost across the entire operational chain. Through this, retailers may find new sales models or better operational procedures to alleviate revenue margin pressures. A retail management system that allows retailers to offer something as basic as increased flexibility in delivery or pickup operations will be able to help them effectively reallocate resources and balance demand load better.
Are you positioned optimally in front of the highest paying customer?
Retail businesses should consider all their revenue levers and see how they can utilize them to accelerate sales and sustain gross margin. For example, senior business and finance executives can initiate a clean-sheet evaluation of product price, assortment, and promotion levers. The derived results can be used to optimize sales and increase customer loyalty. Innovation will be required to address the constantly evolving consumers’ behaviors and needs which will be possible through a high-end retail management system.
According to Bloomreach, 93% of the buyers say that the COVID-19 pandemic has changed their buying behavior and they are primarily buying online as much as possible.
In 2023, retail businesses will find themselves:
- Transforming operations
- Increasing capabilities along select dimensions
- Bolstering digital and omnichannel capabilities
- Rethinking operating models
- Revamping major revenue growth management levers
Some businesses may venture ahead to explore M&A and partnerships, which will also prove to be beneficial for them. The new year will see retailers making bolder moves to maintain resilience, gain more retail customers and increase sales while fighting other crises that may or may not emerge. Investing in a retail management system (RMS) will prove to be their best investment in the turbulent times ahead.