Bob Phibbs, the Retail Doctor® blog at Retaildoc.com

It’s the end of a year when we as a country stared into an economic abyss and it retreated.  From takeovers to bankruptcies, bailouts and the ridiculous assertion shoppers had “fundamentally changed,” retailers heard it all.  It was a lot of things but many new developments will challenge both shoppers and retailers as the economy picks up steam.

Johnny Carson

For Retailers:

• Let’s make a deal.  The hagglers are going to explode on the shopping floor.  Many customers took tentative steps at asking for a discount in 2009 and were rewarded on the spot.  Expect their new-found confidence to challenge everyone’s prices; if for no other reason than they can.
• The iPhone and other cell phones’ shopping Apps will grow to help people price-check, locate similar products as well as pay for all of it.  It will be even more important to have knowledgeable sales staff to add rather than scoff at what online access provides customers.
• Landlords will hold the line on their rent reductions.  They are pressured and over-leveraged and will be less willing to “wait until business gets better.”  It may mean becoming their adversary – don’t do it – you both need each other.
• Fewer vendors will mean it will be harder than ever to differentiate your merch compared to your larger competitors.  Look harder.
• Silent partners will open their mouths.  Whether that is your wife, husband, significant other or relative they will be looking at the time and money spent in running your business and their return on investment.  That means you may have to explain why you are a chronic over-buyer and their money is sitting on your floor gathering dust, not in their bank gathering interest.
• Big boxes have too much space for too much merchandise, look for them to open aisles, close off areas and generally look thinner. Smaller retailers should do the same.  As online shopping continues to grow brick and mortar stores will have to be seen as showcases and playgrounds to try out items rather than warehouses.
• With the economy picking up in many places, your best and brightest employees will be open to looking elsewhere for a paycheck.  Even worse, your “Bitter Betty” employees will be even less likely to leave on their own.
• Customers will come in intending to trade down.  There’s a reason average mattress transactions are down 20%, people can forgo alternatives when it is price-driven.  Sales training will be essential to point out why your premium goods are worth it more than ever.
• Retail sales will continue to improve for those willing to do the hard work and actively capture sales.

Coming up tomorrow: Part 2- what retail customers can expect in their local retail stores.

For retailers looking to get a leg up on their competitors, I’m offering a free mentor session next month, details at http://www.retaildoc.com/mentor.html.

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