Around the holiday season, many consumers purchase most of their items online due to convenience. The frustration arises when the wrong package is received or delivered late. That’s right…a late package, or a difficult return process: What could be more frustrating for consumers?

Online sales will continue to grow in 2012 and will become a bigger focus for retailers. Therefore, consumer sophistication, consumer behaviors, ease of access, and retailer incentives are all needed to boost online sales, as well as in-store sales.

For retailers this year, the question to ask yourselves is: Are you ready to grow? We know that supply chain organizations have their supply chains finely tuned - especially since retail customer service is not living up to standards - and now is the time to step up to the challenge. 

The key focus is improving customer service and managing processes. For instance, making your website user-friendly will allow for increased purchases and satisfied customers.

Below are some trends and challenges to be on the lookout for in 2012:

• Best practices
• Speed to market
• E-Commerce
• China as a market 
• Demand-driven supply chains

Following these five trends will position retailers to emerge as industry leaders and allow for healthy growth in the retail industry. Preparation will help beat out the competition, so begin strategizing now for profitable growth.

For additional information on retail trends: Is Retail Ready to Accelerate in 2012?

Go!Go!Go!

Jim

Resources

Strategies for Transforming Your Supply Chains in 2012

 

Lately, in the area of “uncertainty,” we have been seeing fluctuating gas prices and fluctuating sales. One week, home sales are up; the next week, they are down. And this same trend is happening with unemployment. 

As we keep saying, “uncertainty is certain.” This uncertainty has been impacting many industries, especially retail. (Read our update to the Top 11 Priorities in 2011 for the retail industry.)

An article by Financial Times recently noted that economic uncertainty and high fuel prices are weighing on shoppers and causing mixed sales results.

At the same time, the advancement of technology and mobile shopping is encouraging consumers to spend online. Retail and consumer product companies alike are experiencing an increase in Internet sales, which has caused them to change their online selling strategy.

Mobile Commerce Daily’s article on a survey completed by InMobi says that the results reveal that mobile shopping is expected to reach $9B this year, compared to $2.4B in 2010. (Check out this Top 11 Consumer Product Industry update.)

With new challenges and uncertainties of 2011, retail and consumer product companies have a lot to contend with this year. Being prepared with a strategy and the ability to adapt will go a long way.

What challenges are you experiencing? And what are you doing to overcome them?

Go!Go!Go!

Jim

Photo Credit: mikeatqazam

Today, I welcome Dale Pickett as a guest blogger. Dale has been with Tompkins Associates for nearly 20 years and has spent much of his career in distribution network design, warehousing design and operations, warehouse management systems, and manufacturing. He has keen insight into the best solutions that lead to long-term success for retail companies.

-- Jim

Some people love the change of seasons, but others would like it to remain their favorite season year-round.

While Mother Nature’s changes impact us all, have you ever considered the effects of the seasonal shift for retail merchants? The change of seasons brings special challenges for retailers and their suppliers. The planning and logistics of getting merchandise to the store is staggering.

To begin, let’s take a look at the current economics of the industry.

How are current retail sales? Several industry metrics indicate an upward trend for just about all retail segments, with the exception of furniture. Folks have been holding off spending for the last couple of years because of the uncertainty of the economy, and now the items that they have been putting off finally need to be replaced.

Depending upon where you are geographically in the US, the merchandise is coming to a store near you. For the large items, we have new lawn mowers, outdoor furniture, bigger screen TVs, grills, appliances and beds.

For the everyday items, customers want to buy new clothes to refresh their wardrobes or improve on electronic gadget by using a tax rebate.

This year is/has been full of opportunities to recognize the gaps in the supply chain.

Forecasting models are really set up to use historical information to make a best guess. The tough point is that trends over the last couple years have been down and inventories squeezed to the minimum. The merchandising group has really had to use the old crystal ball and keep their fingers crossed that everything will work out as expected.

So how are you doing with the seasonal push? Have you been meeting your weekly or biweekly circulars? Have you met your customer demand? Have you been shifting merchandise around with excess transportation costs due to fuel costs and loosing margin just to get it to the right place?

Bulk Merchandise Blues?

The toughest product to deal with is the bulk merchandise. When 50 containers show up on Monday morning and you were expecting 5, it is a problem. This product will occupy an incredible amount of floor and storage space and hurt the entire operation.

One method to deal with this surplus – rather than processing with normal delivery – is to crossdock with a terminal philosophy, create separate truckload shipments, and get it out immediately.

This is generally limited to the spring push to the store, and it is very effective but can be painful for the store.

Another approach is a direct-to-store level delivery in front of the supply chain. This deconsolidation of bulk vendor shipments and consolidation to the store helps bypass the primary supply chain. Timing is everything, so it is important to do a test prior to launch. This concept is gaining momentum because this can really help before purchasing more square footage in your supply chain.

What approaches do you use to handle the “spring push”?

-- Dale

Other Resources

China is Changing Supply Chains Around the World: Facts and Trends

Sourcing and Selling in Challenging Economic Times: How Retailers Should Re-think Their Operations and Methods

Finished Goods Inventory Management Hot Topic Report: New Views on an Old Issue

Top 11 Priorities in 2011 for Retail Companies

Although product returns are inevitable, wouldn't it be great for companies and consumers alike to avoid them whenever possible?

New developments in the service supply chain and reverse logistics areas are allowing companies to save money and customers to feel less inconvenienced.

For example, I recently came across a really cool blog post about innovations in how retailers are handling returns in the reverse supply chain. It was a post from The Operations Room, a blog from the Kellogg School of Management's Center for Operations & Supply Chain Management at Northwestern University.

The post explains how retailer Amazon.com has a program in the works that would allow its users to be notified when a gift was going to be sent to them. The user can choose to stop the shipment or choose a different gift instead.

It can also allow users to block whole categories of gifts from being sent to them, basically telling Amazon.com to never send a gift that's in the category of clothing, or DVDs, or jewelry.

The interesting issue that the blog post from The Operations Room pointed out was whether or not it was polite to refuse a gift and change it to something else. Or, as the Operations Room blog authors put it, "That's where operational efficiency smashes into social convention." Although returns cost businesses money, and unwanted gifts can be a nuisance to the consumer, you might never admit to actually using this service!

However, I can make a good case that it is a lot better than re-gifting, and it eliminates the hassle of returning a gift. By intercepting the order before it ships, customers get more satisfaction out of what they receive, and companies gain profitable growth from returns.

More priorities that are sure to emerge this year in the reverse logistics component of supply chain can be found here, in our Top 11 Priorities for Service Supply Chain in 2011.

Are reverse logistics a part of your plan in the coming year? How are you handling returns?

GoGoGo!

Jim


More Resources

Service Supply Chain

Top 11 Priorities for 2011

The Operation Room: Retails and Returns

Photo Credit: mmlolek

The 2010 holiday season was a busy one. And judging from the retail executives that I’ve talked to recently, plus the early numbers from sales, it looks like this will be the best retail season for this industry since before the Great Recession.

I’ve also had several conversations and done a lot of reading about the continuing growth of online shopping and the ease of having packages delivered right to our doorsteps – no crowded malls, no standing in line and no looking for that last spot in the mall parking lot. This year, more of us decided to park ourselves in front of our computers and buy our gifts with a click of the mouse. I personally never entered a store.

According to a MasterCard Advisors SpendingPulse report, consumers spent $36.4 billion online this holiday season – a significant 15.4% increase from last year.

So with e-commerce on the rise, how are retail companies handling the increase? E-commerce has become such a significant portion of total sales that the entire supply chain strategy is being reassessed, making e-commerce one of the Top 11 Priorities for Profitable Growth in 2011 for the retail industry. From network analysis, DC optimization, and improved shipping practices, the retail supply chain is focusing more on direct-to-consumer service.

At the same time, the new technologies that are pushing e-commerce are also changing the buying habits of consumers, giving them instantaneous information and access to products. Adapting to this wave of increased consumer intelligence is another top priority for this industry in 2011. Retailers who adjust to meet the needs of their customers will see the payout for years to come.

Take a look at other top priorities for the retail industry in 2011 and see how yours compare. Is your company prepared for the challenges and opportunities of the upcoming year as you work to achieve profitable growth?

What do you plan to focus on in 2011?

Happy New Year and Go!Go!Go!

Jim

Resources:

Top 11 in 2011 Priorities for Profitable Growth 

Photo credit: alancleaver_2000 

Halloween isn't quite here yet, but malls and department stores are already putting their Christmas decorations on display. These little reminders of the approaching holiday season also remind me that it's almost time to start the gift-giving.

I can remember a few times I've been out shopping around the holidays and tried to find something that wasn't on the shelves. When that happens, if it's something you really want to buy, you might go talk to one of the store's employees to see if the item you want is in the “back room.”

The “back” of the store or the “back room” is sort of an illusion we create. I kind of picture it like this: You go through a normal-looking stock room door, and there before you are rows and rows of gleaming products that are just waiting for intrepid customers to find them. For some reason, it's hidden away, but we seemed to have convinced ourselves that it is back there somewhere and surely there is still hope that we can buy it!

Most of us in supply chain management, especially in retail, know that there is no magical “back room” with extra stock just sitting there waiting for someone to ask about it. The inventory presented in the storefront is pretty much it.

There is a good reason for that: having inventory on hand costs money. In a recent Global Supply Chain Podcast series, inventory expert Ralph Cox and I talked about how increased product availability does not create additional sales for every business. This is especially true now, with web site sales as an option.

Web site purchases allow stores to make a sale even if something is out of stock. And by partnering with an excellent 3PL that can get the item to the customer with incredible speed and efficiency, not having a product in stock is no longer a major disadvantage.

Ralph and I talk more about how inventory can create profitable growth for a company, not just in retail but also for other industries, in this podcast. Listen here or see the text transcript.

I would love to hear some of your inventory stories. Is your company handling inventory any differently this season?

GoGoGo!

Jim

More Resources:

Article: 25 Ways to Lower Inventory Costs

Hot Topic Report: Finished Goods Inventory Management

Executive Briefing: Sales, Inventory and Operations Planning: Crossing Organizational Boundaries

White Paper: Evolution to World-Class Inventory Management

Photo Credit: Pacific Northwest USCG

You’ve heard Dan Avila addressing retail trends here on the Go!Go!Go! Blog a few times over the past year. Today, Tompkins Associates’ “global retail guru” discusses the challenges and outlook for the 2010 peak season. 

Jim 

--------------------------------------------

As the peak retail season for 2010 rolls around, we’re already seeing some challenges resulting from the supply chain improvements that were made during the 2009 season. 

 

As you recall, in peak season 2008, many retailers brought in a lot of inventory, stocking their shelves with scores of items in the hope that they would sell. Well, they didn’t, and these retailers were left with product that had to be either discounted heavily or liquidated. This led to a complete and total change in strategy for peak season 2009. Retailers did not want to repeat peak season 2008, so they made some significant changes in merchandising, forecasting, and inventory levels. 

 

In 2009, retailers reduced the number of items they offered customers, relying on previous top-selling items and not bringing in items if they were unsure that they would sell. 

 

Retailers also forecasted demand more conservatively. The majority of retailers stocked their shelves in 2009 with items that were sure to sell and at inventory levels that would meet the lower demand that was forecasted, thus avoiding the deep discounts and inventory liquidations of 2008. 

 

For the most part, retailers in 2009 have succeeded with lower inventory, fewer product offerings, fewer markdowns, and much less inventory liquidation. 

 

Shortage of shipping capacity and containers impact 2010 peak season 

 

Since retailers reduced the amount of inventory in 2009 – and with the general reductions in inventory due to the economic slowdown – the steamship companies, who transport much of the product from Asia into the U.S. -- reduced their capacity to meet the decreased demand levels. Now, as peak season shipping from Asia to the U.S. begins, there is a serious shortage of shipping capacity from Asia to the U.S. 

 

In the last few years, to meet lower demand, many of the steamship companies took ships off-line or went to “slow steaming” – the practice of reducing the speed of steamships to save on fuel which, in turn, adds to the amount of time a steamship takes to get from point A to point B. It is estimated that as much of 11% of steamship capacity has been pulled to offset the reduced shipping volume. 

 

Another issue affecting capacity is the number of actual containers available to move freight. There are few companies that manufacture ocean freight containers. So when demand dropped, these companies all but stopped manufacturing. 

 

Now that demand has increased, there is a significant shortage of containers. To further complicate matters, exports from Russia and India have increased, causing further strain on capacity of the steamship lines and consumption of containers. This situation makes it even harder to secure freight for U.S. retailers. 

 

This problem began to show itself earlier this year when retailers such as Cost Plus World Market and The Container Store were unable to get product into the U.S. for Father’s Day and summer catalog sales, resulting in lost sales and rain checks. 

 

With the shortage of cargo space on ships, retailers are fighting for space and often outbid each other for freight. Ocean freight from Asia to Los Angeles has increased by as much as 2 to 3 times what it was in 2009. For example, the spot rate for a 40-foot container from Hong Kong to Los Angeles in July 2009 was $871, a five-year low; today the spot rate is up to $2,624, which is a five-year high. 

 

So to ensure that product is on shelves for the holiday season, some retailers have moved away from the solid supply chain practices implemented in 2009. 

 

For instance, retailers are beginning to bring product in early – as early as 3 months before normal. They are taking on additional warehouse space to make sure product is in the stores by the holiday selling season. This, of course, is a painful and costly solution to the problem and can be avoided by working closely with and forming strategic relationships with steamship companies. Some retailers have had success in keeping their products moving by paying surcharges and signing up for longer term deals.

 

I would be interested in knowing what strategies your company is employing to keep freight moving? What are your contingencies?

 

Thanks,

Dan

 

More Resources:

Transportation: http://www.tompkinsinc.com/operations/transportation.asp

Retail Solutions: http://www.tompkinsinc.com/industries/retail.asp

 

In a couple of recent blog posts, we’ve discussed strategies that retailers used in 2009 to prepare for that holiday peak season, and we’ve noted some findings from a recent Supply Chain Consortium survey. Now Dan Avila, guru of retail consultants, is back to share some more findings and a link to the full 2009 Retail Peak Season Report.

-- Jim

--------------------------

Retailers really had to put on their thinking caps for this past holiday season. As with other industries, retail companies had unprecedented economic quandaries going on around them, and they had to come up with ways to get through their busiest time successfully.

Not only have their efforts worked for the 2009 peak season, but retailers are also planning to use many of the same strategies as the 2010 holiday season approaches later this year.

For the past peak season, as the Supply Chain Consortium’s 2009 Retail Peak Season Report found, the top four retail inventory planning strategies used by respondents were:

Reduced inventory levels

Increased emphasis on forecasting

Improved planning processes and tools

Increased reporting and information

Looking ahead to the 2010 holiday season, retailers surveyed also said that they plan to focus on optimizing inventory levels and placement, improving forecasting methods, continuing to refine their SKU base, and executing initiatives with suppliers more effectively in the retail supply chain.

What are your plans for 2010? Will you be using these strategies? Be sure to download the report if you want more details before your peak season begins.

--Dan

More Blog Posts on Retail:

Back to the Future: For Success in Retail, Look to Lessons Learned During the 2009 Peak Season

 

Retail's Rebound Linked to 'New Frugality' of Consumer

 

Retail 2009 Has Been Extremely Challenging, But Here are 5 Issues to Address Now

I frequently talk about resiliency and how companies can plan ahead for tough times. It’s also true that you can learn from past successes and mistakes to create a better future.

Looking back on the holiday season of 2009, we see that retailers (in general) did a good job of battening down the hatches and preparing for a stormy season. Last year’s retail peak season brought a lot of change. Companies had to look at their inventory in a whole new light and come up with innovative ways of making sure they were prepared for the peak season.

To learn more about what retail companies did to cope with unprecedented challenges, the Tompkins Supply Chain Consortium polled its members on their peak season strategies from 2009. Those who responded to the survey had a clear strategy shift from previous years. Some major findings included:

Inventory levels were reduced (in some cases substantially), and generally, retail companies experienced minor negative or no lost sales as a result.

 

Companies emphasized forecasting and planning in an effort to reduce inventory in the retail supply chain.

 

Retailers focused on their own DCs’ crossdocking capabilities and on requiring vendors to hold more inventory for quick deployment.

 

Technology played a part in the peak season, but most companies utilized their existing tools or made somewhat minor enhancements.

 

Retail companies did not discount prices as much as they expected. Price discounting was reduced compared to their plan and compared to previous years.

 

Supply chain capacity was not the major issue that it has been in previous peak seasons. The only issue was Internet and catalog fulfillment capacity, in which significant increases across retail were the norm.

Look for more findings here from the consortium’s new report, Lessons Learned from a Tough Market: 2009 Retail Peak Season Strategies, in the next few weeks.

Meanwhile, are you thinking ahead to your 2010 peak season? What new strategies are you planning?

Go!Go!Go!

Jim

More Resources

www.supplychainconsortium.com - Check back soon for a copy of the new retail report.

 

Specific Resources for the Retail Industry

 

Inventory Management

Photo credit: Flickmor

So how did I do? More importantly, how are you doing? In my guest spot in this blog in November, I talked about the return of retail and predictions for holiday sales.

My optimistic prediction was a modest increase of 4% over Holiday 2008, and in the end, Holiday 2009 was slightly better than that with an increase of a little over 5%.

Even though retail sales appear to be on the rise, there is still a lot of apprehension about the retail sector.

Most experts agree that the retail sector will continue to rebound slowly and continue to face many challenges in 2010. Unemployment and underemployment is high, and living standards for Americans continue to erode, leaving little money for purchases outside of necessities.

In addition to the economy, there will continue to be issues in housing, banking, and health care. This combination results in a new consumer mindset referred to as the "New Frugality" which is also of the biggest retail supply chain trends. This recession has at least temporarily changed the behavior of some consumers, who are now holding on to their discretionary income and being very price and value conscious with their purchases.

This new frugality has manifested itself by consumers trading down in their purchases, less foot traffic in malls and shopping centers, and lower-cost purchases.

What are retailers to do? How do they combat the "New Frugality" and maintain profits and market share? As I see it, there are three areas where retailers can battle back, hold on to their customers and differentiate themselves from competitors. These are: merchandising, inventory, and online sales.

1. Merchandising: In the past, the merchandising mantra has been to put out as many products as possible and see what the consumer likes. This is no longer the case as consumers are more selective and cautious. Merchandising and product development decisions must be researched thoroughly and tested prior to new product launches and releases. A failed product launch could be catastrophic and cause serious damage to a retailer’s bottom line.

 

2. Inventory: In 2009, retailers cut inventory drastically and this, for the most part, had a positive effect on the bottom line. At first the cuts in inventory were done with little regard to minimizing stock-outs and maximizing customer satisfaction. This year, retail supply chain managers have the opportunity to get it right by not only minimizing inventory, but also making sure they have the right inventories in the right quantities in the right locations to meet customer demand.

 

3. Online Sales: Although foot traffic in stores has been down, sales on websites continue to rise drastically. The retailers who truly have a good grasp on online commerce are the ones who will differentiate themselves in the post recession marketplace. Strong web retailers like Amazon, Wal-Mart, and Target continue to improve their websites, fulfillment operations, and delivery options.

2010 will be a year of opportunity for success and failure in the retail sector. Those who focus on and adapt to the "New Frugality" of the post-recession consumer will be the winners. Those who ignore the customer and continue with "business as usual" will suffer and struggle to keep pace with those who do the opposite.

What do you think retailers should focus on in the coming year? If you are in retail, how are you handling the "New Frugality?"

As someone once said, Go!Go!Go!

Dan Avila, Partner, Global Supply Chain Services

2009 has been a very difficult year for all of business. However, as the year comes to a close, it’s evident to me that the most challenging sector has been the retail sector.

I mean, WOW! My thoughts on the most challenging sector are based on the timing of the macro economic recovery and 4th quarter figures. Talk about uncertainty and challenges in predicting the short term requirements – 4th quarter 2009 has been impossible.  

I started writing this blog post in early December, after a lackluster Black Friday and a better than expected Cyber Monday. How will this year fare compared to other years? Recently there were articles in the Wall Street Journal forecasting great results for retail in the 4th quarter and contradicting predictions that the 4th quarter would be well below 2008 figures.

To be perfectly honest, I think I have about as much of a chance of predicting Holiday 2009 as I do predicting the Super Bowl of 2010. Nevertheless, let me tell you what I do know about the retail supply chain that will be true the day you read this:

1. Inventories have been cut based upon financial mandates and not upon a business process of inventory optimization. It is absolutely critical that retail supply chain executives design their Sales & Operations Planning process to allow for the synchronization of supply and demand. By not doing this during the holiday season, retailers will be leaving money on the table. As early as November, some retailers were out of stock on key items with no plans on replenishing their stores.

2. The objective of sustainability efforts is not some environmental utopia, but rather the reality of profitability. The reality of profitability is a result of cost reductions resulting from sustainability efforts and the enhanced revenue growth and goodwill that result from the customers who relate to and appreciate your organization’s stance on sustainability. Sustainability is not a fad. It is a leading business practice and a key ingredient for success in retail.

3. The big picture of the supply chain cannot be over-emphasized. The reality is if all elements of Plan-Buy-Make-Move-Store-Sell are not done in unison, there is little opportunity for the supply chain to truly deliver a competitive advantage. Excellence in the global end-to-end supply chain is required if organizations are to prosper.

4. A real challenge for all retail supply chains is reverse logistics. Reverse logistics is not as simple as "reversing" the supply chain. It is much more complex and sophisticated and involves the 5 R’s of sustainability: reduce, replace, reuse, recycle, and reinvent. Leading retailers have changed the way we think about returns, and are looking at it from a sustainability perspective. Many retailers have reinvented their returns processes and are using returns as an opportunity to create customer loyalty and as a revenue generating source by recycling, refurbishing, and reusing items and selling the items on secondary markets.

5. And finally, what could possibly be the greatest opportunity I see for retail supply chains going forward is the challenge of assuring that the overall business strategy is consistent with the supply chain strategy. For example, if your business model is based on a high level of promotions, does your supply chain support this strategy? Similarly, if the business model is "Every Day Low Prices," how does your supply chain strategy mirror this business strategy? It is critical that your supply chain operation of people, process and technology match your business strategy and that we are in lockstep to make the supply chain a competitive weapon.

So, the retail sector is experiencing the worst timing possible. The economic recovery is precisely overlaid with the 4th quarter of 2009. Whether this plays to your advantage or your detriment depends upon your ability to address the above five issues of inventory management, sustainability, supply chain, reverse logistics, and business supply chain strategy.

What are your thoughts on how this quarter will pan out in retail? Will you dare to make a prediction or would you rather bet on the Super Bowl?

Go!Go!Go!

Jim

Guest blogger Dan Avila, a partner in Global Supply Chain Services for Tompkins Associates, wrote this post on the pulse of retail at this critical time between the economic situation, retail recovery, and the upcoming holiday buying season. Dan's experience includes a focus on retail, with over 20 years in supply chain and 10 years in consulting. Here are his thoughts on the matter.

-Jim

There’s a special "glow" around the retail industry as we move into the holiday season, and it has nothing to do with Rudolph the Reindeer’s nose.

Almost daily, I read a news article predicting what will happen with retail sales this holiday season. In a recession, it makes sense that a brighter light shines on retail and sales predictions. I have seen some predict a 2% decline and others predict as much as a 4% increase over 2008. Either way you slice it, retail is still in the middle of a downturn with some retail sectors performing better than others.

Discounters continue to perform well and luxury item retailers continue to suffer, with all other sectors somewhere in between. While many sources believe the worst of the downturn is over, consumers are still going to be cautious this holiday season. According to a recent survey from the National Retail Federation, Americans are not ready to declare an end to the recession until unemployment levels subside. So the return of retail is not looking good for this holiday season, but many believe that retail will begin to recover in 2010.

It has been vital for retailers to adapt their operations during the downturn in order to keep their doors open. Two significant changes were necessary. First, they reduced their overhead by eliminating unnecessary positions and costs, and secondly, they reduced their inventories by ordering less and by limiting their selection of products to their customers. Because of these two approaches to reducing retail supply chain costs, retailers are in a much better place from an operations and profitability perspective once customers return to their stores.

So what happens in 2010 when retail rebounds and becomes strong again? Will retailers be poised to take advantage when customers come back through their doors? Will the tough lessons learned in 2008 and 2009 help retailers in the future?

The Great Comeback has begun and each of the areas of our economy will slowly rebound, with retail typically lagging behind the other sectors. I see three key areas which will make or break retailers during the Comeback, two of which we have already discussed – reducing operating costs and reducing inventories. The third is evaluating logistics networks.

1) Cost Reduction: The Great Recession has taught surviving retailers many lessons, one of which is to become lean. By eliminating redundant positions, re-thinking the organization structure, and reducing unnecessary costs, retailers are stronger than they have been in a long time. This must continue when the customers return, or they may find themselves in the same situation when we have another downturn.

2) Reduced Inventories: The lessons learned during the Great Recession will be long lasting. Several retailers did not survive due to their high inventory levels and their inability to adapt with the changes in demand. Moving forward, successful retailers will be agile with their inventories and will be quick to pull the plug on low-selling items.

3) Logistics Networks: Many retail logistics networks have not been evaluated in well over five years, and therefore reflect a completely different economic situation. From the cost of fuel to the cost of labor to offshoring and logistics outsourcing, there have been many changes that can make logistics networks obsolete and ineffective.

While we may not be able to predict the exact end of the recession and the beginning of the recovery, one thing is for certain: For retailers to survive, they must take the lessons learned from the Great Recession and use them to fully recover and prosper during the Great Comeback.

Photo credit: timparkinson