BY TOBY GOOLEY, SENIOR EDITOR
RETAIL TRENDS
specialreport
FIRST THE GOOD NEWS: U.S. HOLIDAY RETAIL SALES IN 2016
were up more than 4 percent over sales during the same period in 2015.
Now the bad news: That didn’t seem to help retailers much. In December
and January, several major chains announced or carried out layoffs and
store closings, including Macy’s, JC Penney, CVS, and The Limited (the
last of which recently closed all of its mall stores). This comes on top of
the 2016 demise of Sports Authority and store closing announcements by
Sears, Kmart, Ralph Lauren, Office Depot, and others. Even Walmart is
closing hundreds of stores.
The economic, technological, and societal forces that have converged
to create this industrywide upheaval are many and complex. Online
shopping, changing consumer preferences, the explosive growth in the
number of e-commerce competitors, the cost and operational challenges
of omnichannel operations … those are just a few of the factors affecting
retailers’ ability to survive and remain profitable. Some of the responsibility for minimizing or counteracting the resulting damage falls on the
shoulders of supply chain managers. That is likely why respondents to
the Retail Industry Leaders Association’s (RILA) 7th annual “State of the
Retail Supply Chain” survey said controlling supply chain costs would be
their top strategic priority in 2017.
The difference from year to year is striking. In 2016, “enhance customer service” was the top strategic priority, cited by 30 percent of respondents as their primary concern. This year, just 8 percent said that would
be their primary focus in 2017. Instead, 42 percent of respondents said
controlling supply chain costs would be their main strategic priority, up
Still fighting the
omnichannel
battle
The pressing need to learn how to handle
omnichannel fulfillment profitably is reshaping
retailers’ supply chain strategies, according
to preliminary results of the 2017
“State of the Retail Supply Chain” study.
