AI-analytics solution firm Edited just released a report identifying some top challenges facing retailers and brands due to the coronavirus outbreak, which the company said is causing supply-chain disruptions that include product delays.
“While it’s still too early to measure the full effect of the pandemic on businesses, your 2020 assortment may not look like how you thought it would,” said Emily Bezzant, head analyst at the firm, in the report. “The earlier you plan your next move, the better primed you are to weather the storm.”
Edited noted that as sourcing products and generating newness “is becoming increasingly difficult as factory quarantines continue, consumer demand is not going to decrease nearly as dramatically.”
“It’s unlikely your customer has seen all you have to offer,” Bezzant stated in the report. “How you promote product you’re currently retailing still has the potential to create excitement.” Edited suggested aligning with trends such as Seventies nostalgia, offering pastel hues and touting volume sleeves.
“Be creative with style edits,” Bezzant said. “Color stories and style-encompassing themes such as the Nineties, Seventies and basics can be pulled from your current assortment.”
Bezzant also said that during a crisis that impacts the entire industry, “getting your assortment right is more important than ever. The wrong investment or deadstock can seriously impact a retailer or brand’s ability to weather a storm, whether that be the coronavirus or a global recession.”
To mitigate this risk, Edited said retailers and brands “need to tighten their operations by canceling unnecessary orders to bring assortments to a minimum. Successful retailers are going to be the ones who can quickly downsize their orders and upshift when the markets recover.”
Other tactics include “spreading the risk” by finding local or domestic suppliers. And when it comes to inventory, price points and markdowns, a clear strategy is needed.
“March routinely sees retailers heavily discount as we enter the midseason sales period,” Bezzant stated. “In 2019, 40 percent of Topshop’s assortment was discounted during March and 58 percent of River Island’s. There’s currently no end date for this pandemic, so retailers need to plan for the worst case scenarios. Uncertainty and delays to supplies mean that you’re less likely to want to clear stock as in the past.”
Edited also said “midseason” sales can be confusing for shoppers. “Couple this with the growing trend for ‘instant gratification’, consumers buying what they want to wear now, and you have an opportunity to align yourself closer to your customer’s needs,” the firm said.