Winning at the Speed of Change
By Kent Smith, Vice President, Business Development
With the rate of change in retail getting ever faster, not having the
resources to keep up is not an excuse. Rethink your processes, assign
priorities, and allocate budgets accordingly. Secure the capacity you
need. Decide to win at change.
Keeping up with the rapid pace of change in retail is an important
ingredient for continued success. Being known for having the
latest and greatest is a source of loyalty and therefore a competitive
advantage; sales of new items are key for growth. Still, many retailers
struggle to keep up. What are the problems and what can be done to
win at change?
Major category review processes are lengthy for traditional retailers,
often spanning six months or more. While those efforts get plenty
of attention, the numerous minor changes to assortments and space
get far less. Yet, over a planogram’s lifecycle, more adjustments take
place over cumulative minor changes than in the once a year big
review. As a result, major changes can be slow to market and minor
updates are poorly executed; products are missed, and compliance to
strategy steadily erodes. Sales suffer.
The pace of change in assortment is faster—and getting faster as the
cultural fabric of society is becoming more complex. Smart phones
and other devices are increasing options and informing customers
about products and trends and creating demand groups. Localization
means more customization. All of the above drive a rate of
merchandising renewal that many organizations aren’t ready for. So,
how are you ever going to keep up?
The first step is to accept that change is only going to grow:
don’t just acknowledge that elephant in the room, give it an
Not having the resources to go local (or to manage it effectively)
is not an excuse not to do it: there are rewards, and customers
won’t know and won’t care if the reason you didn’t add that
cluster, version, or size was because you only had the time to
do so many planograms. Not keeping floor plans up to date is
equally suspect. Beyond the beneficial links to tying products
to planograms, and planograms to floorplans in terms of supply
chain and authorizations, knowing what’s “in store” should be the
basis for insights. Generic analysis yields generic results.
Think seriously about space management capacity and tools. Get
the tools that enable you to synthesize opportunities and craft
plans and updates quickly. Begin to manage those minor updates
closely—no piling them up on the side of the desk and waiting
important seat at the table. Gear the organization – the people,
the process, the budgets, and the solutions – to make effective,
efficient, and targeted change a competitive advantage. Consider
rethinking the long, often linear processes of the “major category
review” and instead see the reality of category management not
such much as one-a-year grand review, but rather in terms of
a steady stream of data points, synthesis, and constant course
adjustments.
You’ll still have major and minor resets at stores, but think about
reapportioning the budgets more appropriately – and get more
if you have to. Implementing all scales of change has to be
funded. The cost of execution is small compared to the costs of
getting the first shipment of the product there.
Expertise.
Ethics.
Partnership.
vacosupplychainsolutions.com
(804) 282-2033
for some spare time to add them to planograms—you’ll never
have the spare time. Engage the right type of capacity, ensure
you have the appropriate baseline and then options for “surge”
resources to accommodate the inevitable spikes in workload that
occur in any retail sector.
Vaco Supply Chain Solutions, an integral part of the $280mm
per year Vaco Nation of experts, brings both the expertise and
entrepreneurial culture needed to help you succeed with change.
From upgrading and implementing software, to optimizing your
processes and tool use, to actually refinishing, creating, and
maintaining floorplans, Vaco’s Merchandising on Demand™ menu
of flexible services can enhance your programs to win. Change
is inevitable. Decide to win at it.
vacosupplychainsolutions.com
(804) 282-2033