This excellent article was written by David Matsil of Enhanced Retail Solutions. He is one of the real gurus of retail electronic commerce and a friend too.
The overwhelming conventional wisdom we hear when discussing the merits of a supplier’s deep dive of their retail partners’ items’ sell through is:
“We do it already”.
“We have a pretty good handle on our business”.
You do not know what you don’t know.
Wouldn’t you want to understand your business as quickly and thoroughly as possible for discussions with your retail partner or when making merchandising decisions for your next line? You see, retail battles are won as much by intelligence as they are by quality of product.
And did you know that 41% of retail initiatives are not executed in the intended fashion?
Most companies study the business at chain level, yet only door level (each individual store of a chain) can indicate sold out stores as well as inventory that never made it out of the stockroom.
The best way to determine if you are studying the business to the fullest is to answer these questions:
- Can you store all your data in one place and in one format?
- Can you easily drill down to door level? Or would it take you all week?
- Are you getting results like these?
- Saving $100,000+ in markdown dollars.
- 30% store execution improvement in two weeks.
- Exposing a 12,000 unit/$720,000 sales opportunity.
- Increasing Instock level from 85% to 98%.
- Convincing a buyer to launch what becomes a $40+ million dollar/year business.
- Using traiting to help push an additional 150,000 units.
- Can you integrate Data Points such as product images, demographics, weather or your wholesale inventory?
- Can you Integrate Outside Trends such as CPI, inflation rates or the price of gas?
- Do you have interactive Dashboards to overview your business?
- Can you create Visuals (charts, graphs, gauges) on the fly?
- Can you easily filter your reporting?
- Can you cull out door level opportunities and liabilities in seconds?
- You get out what you put in. This is a discipline that pays dividends.
- Think bigger, Think differently. Add science to your sales pitch. Reduce risk for the buyer. Tell them something they do not know.
- Look granular: door level, sku level.
- The Opportunities and Liabilities approach to store level analysis is the new normal: Retailers are not growing store count. This is where the growth comes.
- Integrate multiple data points to highlight actionable opportunities that may otherwise go undetected.
- Be creative: Make use of demographics, find holes in assortment.
- Pictures say a thousand words.
- Reconsider if you have the right tools for the job.
If you are not at the top of your game, you are handing your rival a competitive advantage.
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