April 24, 2020 |
All of us have spent the last several weeks focused on the health and well-being of our teams and companies, and, in some cases, even survival. Now, the industry stands at an unparalleled juncture. Retail is facing more change, uncertainty, risk, and—if you can allow yourself to imagine it—reward than it has in memorable history.
There are innumerable predictions in the market about when the shelter-in-place recommendations will end and how the consumer is likely to respond. But let’s be honest—no one has the answer to these predicaments. The one certainty is that at some point, there will be an after. And we believe our industry should tune out all the prognosticators and focus on the pragmatists. We will return to work. Consumers will start shopping in stores and eating out. Movie theaters and theme parks will fill up again, and there will be vacations once more. Predicting when and how soon is a fool’s errand, but we are seeing too many companies gripped in the paralysis of unknown variables. The fact is, it would be easier to try to solve Goldbach’s conjecture than plan in-store comps for the fourth quarter. This does not mean we should do nothing. It does mean that we should stop focusing on what we cannot control.
Even today, without a single known variable, pragmatic and experienced crisis managers can create a set of action-reaction-adjust cycles for all operational levers needed to restart our businesses. Over the next several weeks, we are going to tackle one set of operational considerations at a time. To do this, our otherwise monthly newsletter will come to you weekly. We will offer in-depth and practical answers to the “how”, the “what”, and “what if”. There are hundreds of questions that need an answer, and we understand that can feel exhausting to even contemplate. By breaking the areas down, one at a time, we want to help our industry focus attention in a way that will help accelerate hands-on progress. These are some of the kinds of questions we will tackle:
• How do you plan for the phased opening of stores, especially as the role and configuration of the store will change based on government policies and customer receptivity? What do you do if traffic is slower? Faster? Nonexistent? What happens if you have to close again?
• How do you plan for the safety and security of your store staff, but also plan to return to profitable—or nearly profitable—four-wall operations?
• What factors need to be considered as you embark on stabilizing and enhancing ecommerce capabilities while maintaining margins and optimizing operations? How can you leverage stranded in-store merchandise to fulfill online demand? How can you do all this in a practical, realistic, rapid way?
• How can you create forecasting and manufacturing agility to support merchandising and product-development efforts with pragmatic actions?
• How do you do that while taking into account product and channel mix changes? How do you plan a season with no hindsight?
• How will retailer-brand-vendor-manufacturer-landlord relationships need to change to cope with ongoing needs and economics? How much more difficult will it be in light of the actions taken in and the potential erosion of trust caused by the last six weeks?
• How can you stay more in tune with your consumer? How can you engage and communicate with customers to better understand motivations and meet needs while also helping shape behaviors and outcomes?
Over the last several weeks, our industry has raced to navigate and confront the crisis and made herculean efforts to support employees and customers. The weeks and months ahead will be similarly challenging, but the winners will be the planners and pragmatists, not the strategists and soothsayers. We’re hard at work writing the Restart Playbook and look forward to sharing it with you.
Compliments of AlixPartners – a member of the EACCNY.