It’s safe to say that 2020 was a difficult year for retail. But what were the top challenges that planners and merchants faced, and what can we learn from them?
In our quest to learn from the many complexities that COVID-19 presented, we asked a number of retailers, thought leaders and Aptos experts what they have had to overcome since the pandemic began. The top five challenges that they identified can be summed up as follows:
Many retailers were not well prepared to meet these challenges. Many were not close enough to the consumer. Others were locked into planning too many months in advance. And still others were unable to shift their orders and inventory to the categories and channels that were selling the most.
The ones that did fare the best during the crisis, Sheekey commented, were the ones that already had a solid omnichannel planning strategy in place.
“Retailers that thrived during the darkest days of 2020 were those that had an unsevered connection to their customers, were better equipped to capture omnichannel demand signals and could respond to those demand signals in-season,” he said.
Sheekey recommended that planning functions and solutions transform to meet omnichannel behaviours and expectations.
“These new retail requirements cannot be managed by older planning processes and tools,” he said. “With all the shifts that retailers are experiencing, understanding omnichannel demand, where to place inventory, how much inventory to make available across locations and adapting quickly to changing consumer behaviours is absolutely crucial.”
The coming months will provide myriad opportunities to recoup lost sales, particularly for retailers that were hit the hardest by the mandatory store closures. The return to offices and the resurgence of social events, staycations, back-to-school shopping and the festive season will create a perfect storm of demand. The major issue here is ensuring that retailers have the right inventory on hand in the right places to meet omnichannel demand.
According to Sheekey, as retailers look to retool their planning strategies for the new normal, there are several best practices and recommendations to consider:
We asked a couple of planning experts to share their experiences with omnichannel planning and why maturity in this area is especially critical during times of disruption.
“Omnichannel in no longer a service to promise, but is a must that customers require as normality,” said Andrea Tonello, Head of Planning at sportswear leader AW LAB. “Looking at our business, all actual figures are now mixing up between each channel: digital, direct and franchising stores. Having a solid planning and processes solution in place allowed us to rapidly adjust to new conditions and prepare a new financial, store and merchandising plan, with a new mindset, new KPIs and a new assortment clustering, which is more digitally oriented. We managed to change in a quick, agile way.”
“Thanks to the ability to execute just-in-time replenishments, we have optimally supported the needs of our customers over this very unique period,” said Alberto Fratantonio, the Marcolin Order Replenishment Evolution (MORE) Project Leader at Marcolin, a leading worldwide eyewear company. “We have been able to dynamically adjust our replenishments every week, matching the continuous swings in demand generated by variations in the epidemic curve and the resulting social and business restrictions.”
To learn how Aptos is supporting its customers with retail planning software for the omnichannel era, read our Marcolin case study.