As part of a continuing series to keep you up to date and sharpen your retail skills, Blacks reporting service again sat down with Blacks Retail Founder and Senior Consultant Steve Pruitt to discuss trends, profits and how weather is affecting sales. Here’s the lowdown:
1) You went to market this past week in NYC. What trends are you seeing in men’s and women’s apparel?
There’s definitely an outdoor trend going on, but for most of our clients (in the luxury market) that doesn’t have much of an effect on their business. Heavier sweaters, boots and knits were all making an appearance.
Among our clients, we’re seeing a trend toward slender bodies and fancier goods. Retailers are continuing to look for more fancy products, with a push toward a more eclectic range of styles. There are new colors as well, and more color overall, not so much black, gray, and white.
In accessories, hats are making a big push. It’s been a while since hats have left their mark. Before it was for younger men, but now we’re seeing hats translate over into older men’s markets. I would expect for that to play out this fall.
2) A common mistake among younger retailers is their inability to increase profits beyond what’s on the floor. Why is this a common obstacle?
Typically, their profits are stuck in inventory because they are not turning over their goods fast enough.
To avoid this phenomenon you have to have a better understanding of what your turnover should be, and whether there’s enough working capital in the business. You can be in a situation where your profits are on the floor even when you have a consistent turn of goods, due to inadequate working capital. I find this in younger companies in particular.
3) You had mentioned last week that you’re predicting a slowdown in growth for the Fall 2011 season. How should retailers prepare now for this likely slowdown?
Yes, after gains for two seasons there is typically a slowdown, though, this rule may not hold true for all stores. It could be argued that while the fall of 2009 had gains, after a horrible 2008, the increases were by no means significant. In turn, this slowdown period may not apply to this cycle.
However, if we do face a slowdown, which I think is likely, stores need to fight this by bringing a higher level of excitement to their products and by adding new product and initiatives. You need to improve the metrics of your business and everything that entails to stay ahead.
4) How has business been overall in the past month? Are you seeing a trend going into the Spring?
Business is starting out well, but, because of fierce weather, we may have a later spring opening. Easter is coming a little later this year also, and this is typically not good for business.
What happens is the market starts its spring marketing initiatives later and as a result you just don’t have as long to sell during the spring season, making for a longer recovery after the winter.
5) The weather has certainly been in the way of consumers this past winter. What affect has this had on retailers, aside from a slowdown in sales?
We’re only into January but the weather has been unusually cold, and if this goes on too long it’s going to keep customers from buying new merchandise. We’ve also have a problem with slow deliveries due to bad weather, which translates to a slowdown in sales. Slow deliveries prevent retailers from having fresh product when they need it.
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