Show Notes | S4 Ep2 New Supplies, New Demands

Show Notes |S4 Ep2

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New Supplies, New Demands

Supply and distribution remain weak links in Retail. It’s time to fix it.

INTRODUCTION

The second episode of our mini-series is titled, New Supplies, New Demands.

This is another trend we saw come up through the WARDLEY maps. Supply chains came to the breaking point during the pandemic but they were stressed beforehand. As complexity increased  – distance, currencies, intermediaries – new ways of working, rapid changes in communications modes. The systems designed to run “lights out” were completely opaque which made understanding, and then changing them very difficult. And it impacted everyone buying and selling goods in some fashion.

INDUSTRY UPDATES | Our New Segment

This is our new segment for Season 4. We highlight and discuss recent retail-related news.

THE CONVERSATION

Why does your supply suffer so much?

  • One up, one down mentality
  • Lack of shared understanding
  • Not built for current or future generations

We discuss the opacity of supply chains. The way to think of this is that I know who I bought it from. And I know – for the most part – who I’m selling it to.  I might know a bit more than that. In companies that are focused on sustainability, or operating in Geo’s where regulations and compliance require, scope2 and 3 it will be required.

And retailers – who could contribute data to a shared data source allowing them to create shared understanding – won’t. So, it’s like we can fix this but we won’t because I think someone will learn something about our vendors and the like. But more on that as we go.

We discussed why it took one year to adequately document the supply chain of an egg.

We also discuss a recent statement by Jon Moeller, Chairman, President and CEO of P&G during an investor day. And, I quote,  “We’re calling this Supply 3.0, the next generation of supply chain, an end-to-end synchronized, sustainable and resilient supply chain amplified by data analytics, and enabled by an organization at the leading edge of transformation, mastery and leadership.”

We discussed some  new thinking. These include:

  • Slow fashion
  • The Unbrand
  • Rise of the artisan class
  • Zero distance supply chain

Slow Fashion

This is MTO, made to order. Examples include:

MTO allows less waste, better fits and ability to update/offer more options and overall greater control.  And that leads to the following desirable outcomes:

  • Better forecasting (there’s still forecasting, but from a materials perspective…)
  • Fewer overstocks
  • Improved materials management

The Unbrand

We highlight:

For the Unbranded, hallmarks are:

  • Short runs (it may sell out and there is only one source of supply)
  • Line fillers (manufacturing for the top brands with high quality materials, so the factory can spread its fixed overhead costs)
  • Membership models that even out revenue streams and provide bottom line enhancement

And this means you are:

  • Direct to customer – you can’t depend on retail placement. Popups and other innovations might be helpful but traditional pipelines are designed for scale – and this is smaller scale.
  • Focused on Process control and not packaging.
  • You need a heavy curation – you’re not going to have 16 colors. You might have 4
  • But you Focus on ingredients – from fabrics to chemicals

The Rise Of The Artisan Class

Cristene’s Hero from last episode, Etsy, is called out here. Along with:

This is a bit of the flip of the unbranded. You’re engaging with these brands because they’ve created personalities and communities that deliver rich experiences. This is built on media, albeit social media, excitement.

Zero Distance Supply Chain

We reference:

The less distance something has to travel, it often means an item has less of an environmental footprint. So, it’s not just:

  • Local cachet
  • It’s also Community engagement.
  • So while this offers abbreviated transport, it requires greater coordination – sometimes significantly more for replenishment needs
  • Consistency challenges

Desirable outcomes include:

  • Small business and community benefit
  • Potential tax benefits
  • Consumer support
  • Shorter runs, more turns (or so they say)

CONCLUSION

Let’s wrap this up.

  • Traceability for the complete supply chain is the goal.
  • Continuously collaborating with your suppliers is key
  • Innovate, pilot and evaluate. Repeat
  • Going local changes cost, mix and availability metrics. Creating flexibility in the system is critical for success.
  • Wedding yourself to your market means acting like a partner; different benefits mean new ways of marketing
  • And, to conclude, customer education seems hard – all outreach is. But, it’s needed to take pressure off front line employees who may bear the brunt of customers while adjusting.

HEROES & CHANGE MAKERS

Jeff’s selection is The Customer. The customer that is driving the economy of the United States, that is shopping, being inspired. It’s not necessarily always about simply buying, it’s about what you buy. The reason why you buy, for whom, how your buying and shopping…. I think this is why we talk about the Customer Channel on a daily basis – because it always comes back to them.

Cristene selected ReturnBar. They now have 10,000 locations, covering over 90% of the US population. When you can go – box-free – to a location and drop off goods to return, this online-IRL blending speaks to what this podcast is about. No channels, except the Customer Channel.

This is RETAIL DONE RIGHT. Thank you for listening. And please join our conversation.

Let’s go shopping!

Jeff Fisher & Cristene Gonzalez-Wertz

Connect with Jeff on LinkedIn

Connect with Cristene on LinkedIn

RETAIL DONE RIGHT is produced and hosted by Jeff Fisher & Cristene Gonzalez-Wertz

Show Notes | S4 Ep1 | The Rise of the Customer Channel

The Rise of the Customer Channel

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Omnichannel has nothing to do with the customer. Customers don’t see channels. They see tasks and transactions. Why can’t we? (It’s because we are tied to staying in old lanes; because it’s easier to measure and we think we know the metrics.)

INTRODUCTION

We’re kicking off Season 4 with our own mini-series – Retail trends that are the result of a tremendous amount of research, data, data mining, editing and extrapolated insights. We discuss incredibly relevant trends and themes we’re seeing in Retail along with some additional thoughts along the way. The mini-series will cover:

  1. Rise of the Customer Channel
  2. New Supply, New Demands
  3. Tech Debt as Business Risk
  4. Data for ESG and Sustainability
  5. Talent Management Requires New Thinking
  6. Retail Media: The New Frontier

We begin with The Rise of the Customer Channel.

Omnichannel has nothing to do with the customer. Customers don’t see channels. They see tasks and transactions. Why can’t we? (It’s because we are tied to staying in old lanes; because it’s easier to measure and we think we know the metrics.)

INDUSTRY UPDATES | Our New Segment

This is our new segment for Season 4. We highlight and discuss recent retail-related news.

  • We’re in the Holiday season; make or break for many, if not most, retailers.  Black Friday was good overall. everyone is still cautious though.
  • Discounts continue to be quite aggressive. Consumers are able to get quite good deals.
  • According to Adobe Analytics, shoppers spent $109.3 billion online between Nov.1 and Nov. 27, a 7.3% bump from the year prior.
  • The National Retail Federation said 200.4 million consumers shopped between Thanksgiving Day and Cyber Monday, higher than the organization’s 182 million prediction.
  • Retail Dive highlighted a recent Shopify-Gallup Holiday Shopping Pulse survey of 1,888 consumers that states more than half (56%) of U.S. shoppers are more likely to do their holiday shopping in person in December than in other months
  • The WSJ is reporting that luxury brands are sitting on a lot of excess inventory and are exploring ways to offload this without deep discounts.  Consumers have pulled back, even in the luxury market.

THE CONVERSATION

What’s going on out there? Market conditions remain volatile, but November was a great month for the S&P 500 and the Nasdaq. Inflation remains higher than the Fed’s target, though the job market remains strong (the unemployment rate dropped to 3.7% on a good jobs report recently).

  • “Inflationary pressures” are being called out for slowing tech investment
  • Supply and distribution are still weak links – it’s not that we can’t get items, it’s that if we have challenges similar to the ones that disrupted us in the not too distant past, we will see the same results now as we did then, empty shelves and price arbitrage
  • As social pressure intensifies, gains emerge for people and planet
  • Yet, speaking of price arbitrage – retailers are seeing tremendous profits and massive stock buy-backs driven on price increases that go vastly beyond inflation.

It’s remarkable to see what appears to be a very healthy economy, though consumer sentiment and confidence isn’t there. A tale of two perspectives – and perception is reality, or at least when you’re shopping and prices continue to increase, you feel it directly. Gas prices continue to go down, which is a big help.

It’s time for retailers to refocus, well, everything, around the customer. Their journey. Their experience. Their happiness. And we mean their happiness.

THE HANNUKAH MENU

Here’s Cristene’s Hannukah menu, according to ChatGPT:

Creating a Hanukkah dinner that caters to a variety of dietary preferences, including vegetarian and gluten-free options, can be a delightful and inclusive experience. Here’s a proposed five-course dinner with eight dishes that balances tradition with dietary considerations:

### 1. Appetizer

  1. **Latkes (Potato Pancakes)** – A classic Hanukkah dish. Serve traditional potato latkes for those who eat gluten and offer a gluten-free version made with gluten-free flour or potato starch.
  2. **Stuffed Mushrooms** – Vegetarian and gluten-free. Stuff mushrooms with a mixture of herbed cheese, spinach, and gluten-free breadcrumbs for a savory start.

### 2. Soup

  1. **Matzo Ball Soup** – Offer two types of matzo balls: traditional and gluten-free matzo balls made with gluten-free matzo meal. The soup can be a rich vegetable broth, accommodating vegetarian guests.

### 3. Salad

  1. **Garden Salad with Pomegranate & Orange Slices** – A fresh, citrusy salad that’s both vegetarian and gluten-free. Toss mixed greens with pomegranate seeds, orange slices, and a light vinaigrette.

### 4. Main Course

  1. **Brisket** – A traditional, tender beef brisket, slow-cooked and seasoned with herbs.
  2. **Stuffed Bell Peppers** – Vegetarian and gluten-free. Bell peppers stuffed with quinoa, black beans, corn, and topped with a bit of cheese.

### 5. Side Dishes

  1. **Roasted Vegetables** – A colorful assortment of roasted vegetables like carrots, Brussels sprouts, and sweet potatoes, seasoned with herbs. This dish is both vegetarian and gluten-free.
  2. **Quinoa Pilaf** – A flavorful and hearty side that’s gluten-free and vegetarian. Cook quinoa with onions, garlic, and vegetable broth, then mix in chopped nuts and dried fruits for texture and flavor.

### Dessert (Optional)

While not traditionally part of the five courses, a Hanukkah dinner can be topped off with a sweet finish like sufganiyot (jelly doughnuts) for those who indulge and a gluten-free, dairy-free apple crisp for a lighter, dietary-friendly option.

This menu provides a balance of traditional dishes with considerations for vegetarian and gluten-free dietary needs, ensuring all guests can partake in the festive meal.

LINKS

CONCLUSION

If you lose the customer’s trust, you lose the relationship. Sure, they might shop you transactionally, and that might be enough but that’s not loyalty. They will move as soon as someone gives the reason.

HEROES & CHANGE MAKERS

Jeff’s selection is Taylor Swift. Time Magazine’s person of the year (I’m sure this can – and is – being debated.) Not only is she a billionaire, but she drove a lot of ticket sales for her Eras Tour and her self-produced movie along with all those flights, hotel rooms, meals and bracelets.

Cristene selected Etsy. Etsy is a two-sided business model, and while I know Etsy sellers wish the fees were less, they are less than Amazon and still focus on small, and often handmade businesses around the globe. Going on 15 years, and with a book about some of its epic failures, it’s still among the biggest and most trusted makers markets out there.

This is RETAIL DONE RIGHT. Thank you for listening. And please join our conversation.

Let’s go shopping!

Jeff Fisher & Cristene Gonzalez-Wertz

Connect with Jeff on LinkedIn

Connect with Cristene on LinkedIn

RETAIL DONE RIGHT is produced and hosted by Jeff Fisher & Cristene Gonzalez-Wertz

 

Show Notes | S3 Ep7 | Talking Sustainability

Special Guest, Juli Lassow, Founder & Principle of JHL Solutions

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INTRODUCTION

Consumers continue to demand change from retailers and brands. They are shopping their values. But has this become simply a marketing message for brands and retailers today? Or are we making real progress on the sustainability front?

What’s missing today is a simple framework, or a set of principles, that retailers and brands can implement quickly and efficiently.  We discuss 4 pragmatic principles for retailers with our returning friend and special guest, Juli Lassow, Founder & Principal of JHL Solutions.

THE CONVERSATION

Juli started by stating that Sustainability is a massive concept, intimidating and difficult to gain traction on.  How’s that for starting out on a high note?

Juli then shared that like any good consultant, she likes to leverage a framework to tackle a strategic challenge. Within the sustainability space, she is a massive fan of the Circular Economy to help inform her approach. She looks to circularity to outline her priorities for retailers and their brand partners:

  • Reduce waste and pollution – from the food we eat, and the clothes we wear, packaging that all of it arrives in..
  • Extend product life – reduce, reuse, recycle, compost – but importantly – shift the focus to repair, resale, remanufacture -tightening the resource “loop” as much as possible…
  • Rebuild natural systems – there are two sides to the circular approaches – the mechanical and the organic.  Natural systems are most commonly found on the organic side of the circular philosophy.
  • https://ellenmacarthurfoundation.org/circular-economy-diagram

The conversation focused on 4 pragmatic principles:

  1. Products
  2. Production Partners
  3. Packaging
  4. Profitability/Price

This is all grounded in Measurement. What gets measured gets managed. Once defined, you need to socialize internally and externally to stakeholders: customers, shareholders, supplier partners.

LINKS

CONCLUSION

These are pragmatic principles you can implement today.  It’s about action. It’s about moving forward.   Of course, there’s much more to it like the retail ecosystem, logistics, store operations for example.  But the challenge is to start and to make continuous progress on.

HEROES & CHANGE MAKERS | Our New Feature

Our new feature, Heroes and Change Makers, concluded our discussion.

We invited Juli to select our Hero & Change Maker and she selected the leadership team at Kroger.

Juli stated, Kroger has been recognized as one of “America’s Most Responsible Companies” by Newsweek, earning the distinction for the fourth consecutive year. The recognition was in part due to the company’s Zero Hunger | Zero Waste social and environmental impact plan. Over the past 5 years, Kroger has donated 2.3 billion meals to fight hunger.

“This recognition is a testament to the incredible dedication of our associates and our collective commitment to end hunger through Zero Hunger | Zero Waste,” said Rodney McMullen, Kroger’s chairman and CEO. “Kroger plays a critical role in building a more resilient and sustainable food system for all of America.”


Kroger also partners with another notable name in the CPG sustainability front – Terracycle and specifically Loop.  LOOP made its U.S. debut earlier this year through a partnership with The Kroger Co., to provide consumers with a way to go from single-use packaging to one that is reusable.

We agree with Juli – great selection.

This is RETAIL DONE RIGHT. Thank you for listening. And please join our conversation.

Let’s go shopping!

Jeff Fisher & Cristene Gonzalez-Wertz

Connect with Jeff on LinkedIn

Connect with Cristene on LinkedIn

RETAIL DONE RIGHT is produced and hosted by Jeff Fisher & Cristene Gonzalez-Wertz

Show Notes |S3 Ep6 | Resurrecting Retail: An Interview with Doug Stephens

INTRODUCTION

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We welcome Doug Stephens, Founder and CEO of the global advisory firm Retail Prophet to Retail Done Right. Doug is a retail futurist and best-selling author of 3 books, including his newest, “Resurrecting Retail.”  His perspective is grounded in fact, yet far reaching. And we cover a lot of ground in this interview. From people to product, and especially experience, from online lessons that brick-and-mortar retailers need to learn to born-digital ecommerce player’s desire to build physical stores. So much thought-provoking content.

Physical stores will stay relevant and become more strategic for retail organizations if they are no longer managed as points of sale. Stores are the most effective tool to acquire and engage customers, becoming more like media networks. They have also been transformed into logistics, service and experience hubs.

Retail organizations need to shift from a product and operations forum into truly customer-centric business models that will demand new KPIs and new ways to measure the contribution of the stores in attracting, retaining and engaging more customers, increasing their lifetime value.

THE CONVERSATION

We explored a variety of topics via a series of questions:

  • Can you tell us about your career trajectory? We’re curious how you got to where you are today.
  • How do you see the health of retail? Are retail balance sheets healthier today?
  • A key idea in your latest book, “Resurrecting Retail,” is introduced in the Forward by Imran Amed, Founder and CEO of The Business of Fashion, “It’s no longer about sales per square foot and cost per click, but rather about experiences per square foot and sales per click.”

Later in the book, you write, “The key to effectively measuring the true productivity of a store is found by focusing on a metric we’re already familiar with from the marketing side of the industry…a value per media impression. In other words, determining the value of a positive brand impression delivered via a physical experience… The point is that physical retail is no longer simply a product distribution strategy – it’s a customer acquisition strategy with an inherent and attributable return of value… The question is, ‘What is the appropriate value to attribute to physical stores? It’s…one that requires two components: 1st, an internally agreed-upon value per customer impression; and 2nd,… a gauge of the quality of the average impression.’”

Would you elaborate a little more?

  • There’s been a tremendous amount of press about the Great Resignation, and more recently Quiet Quitting. Retail and Hospitality are nearly double other industries in terms of defection. But high turnover isn’t necessarily new to these industries. To mix metaphors, how should we manage the front line and the bottom line?
  • You talk about how, for instance, music streaming and virtual concerts are changing the live experience – possibly putting pressure on that live experience. Would you say this is also true of the retail experience? Over time will stores 1) Be able to compete effectively with digital experiences? 2) Will they be able to afford to do so on declining traffic? Feels a bit like a double whammy, no?
  • Is a separate .com structure weighing orgs down? Especially due to the costs of fulfillment and shipping and delivery? In your book, you walk through the economics of this (p 91). Can you share more as the statistics were shocking?
  • Cost of transportation: not just mid and last mile but acquisition of goods… Can we really afford globally produced goods on increased fuel prices and from a sustainability perspective?
  • The Alibaba Freshippo example in your book is a peerless example of a digital and IRL integration. Can you describe this more?
  • Might you also explore CAMP out loud for us? (p139)
  • Where are the core and emerging potential economies of scale?
  • What’s your opinion on what Gary Friedman has done with RH? You talk about their paid membership program, but I’m asking from a broader perspective. (pg191)

CONCLUSION

In summary, we asked Doug, if you were to offer retail executives three areas to evaluate for changes right now, what would they be? Doug summarized:

“…Number 1 is to get back to who are we and why do we, and for whom, and what is the value we create in the world? Number two, how can we ensure that this experiential media that we’re delivering to consumers every day is positive and valuable to our business? And thirdly, how can we redesign supply chains for this new disruptive era that we do business in? And I think if you can do all three of those things in your business, you’re a champion.”

HEROES & CHANGE MAKERS | Our New Feature

Our new feature, Heroes and Change Makers, concluded our discussion.

We invited Doug to select our Hero & Change Maker and his selection did not disappoint.  Yvon Chouinard, founder and CEO of Patagonia.

Doug states, “…the fact of the matter is, since its inception as a business, Yvon Chouinard, who by the way is a true outdoorsman himself, really has always valued the outdoors. The raison d’être of the business has always been to stand on the front lines of environmental destruction and to try and save the planet in any way that they can. To transform the business into a charitable trust, to do just that into perpetuity, I think makes the man a hero.”

We couldn’t agree more.

This is RETAIL DONE RIGHT. Thank you for listening. And please join our conversation.

Let’s go shopping!

Jeff Fisher & Cristene Gonzalez-Wertz

Connect with Jeff on LinkedIn

Connect with Cristene on LinkedIn

RETAIL DONE RIGHT is produced and hosted by Jeff Fisher & Cristene Gonzalez-Wertz