Play Offense in 2008
Jennifer Marks -- Home Textiles Today, February 4, 2008
And thanks for nothing.
To recap: Scary Dow rollercoaster ride. Two rate cuts by the Fed. Consumer Confidence smacked down. Weekly retail sales anemic. Several retailers take their year-end profit estimates down a peg. Rumors of one, if not two, possible retail bankruptcies.
And in the final days of the month, announcements of reorgs and/or job cuts at Wal-Mart, JCPenney, Sears Holdings, Home Depot, Eddie Bauer, Goody's and Ann Taylor.
Not all of them deal with home textiles, but as a sign 'o the times, not so encouraging.
Still, merchandise will be bought and sold. The battle for market share carries on.
The nature of that battle — despite the larger, macro-economic factors — hasn't changed much in the past several years. The last real retail boom, in terms of expanding the size of the universe, happened nearly 20 years ago. Driven by the burgeoning discount general merchandiser segment (even the regional chains went on an aggressive expansion tear) and a proliferation of category killer start-ups, the field opened and the bleachers filled to capacity.
But contraction has come in steady waves for the past 15 years. In real terms, the industry's retailers and suppliers have been playing between the 49-yard lines for a long time now. That grueling game doesn't look set to change anytime soon.
The wisdom of the moment among larger players holds that supply chain and distribution efficiencies will be key to keeping margins from collapse. Among smaller players, it's about burrowing deeply into each niche for nuggets of gold that the big guys' earth-movers can 't detect.
The larger strategy this year boils down to defending every square foot one already occupies while clawing forward to capture a few more.
Which means: the offense, in the form of stronger merchandise offerings, sharp in-store display and energetic targeted marketing, has to take over the game from the defense (aka, what worked last year).
Regardless of what the economy spins our way in the coming months, business will be done.
Hello, February. Please be kind.
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