Article Number : 4457 |
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| Date | 5/11/2009 7:06:45 AM |
| Written By | LGM & Associates Technical Flooring Services |
| View this article at: | //floorbiz.com/BizResources/NPViewArticle.asp?ArticleID=4457 |
| Abstract | Independent retailers have been struggling for about two years. They are having to lower profits and find creative marketing solutions just to try and survive the economic downturn. The big chains are feeling it, too. Stores like Neiman Marcus, Nordstrom and Macy’s are posting dramatic declines... |
| Article | Independent retailers have been struggling for about two years. They are having to lower profits and find creative marketing solutions just to try and survive the economic downturn. The big chains are feeling it, too. Stores like Neiman Marcus, Nordstrom and Macy’s are posting dramatic declines. Discounters like Mervyns and Steve & Barry liquidated. Big boxes can do a number of things to keep margins up and business moving. They can trim employee hours, cut the staff, advertise deep discounts to drive foot traffic and move inventory, use clout to negotiate better prices, etc. Unfortunately, smaller stores do not have these options. So, what are they to do? I’ve spent the brunt of the downturn listening to the experts. Most of what they tell retailers are the basics: manage expenses, cut overhead, focus on selling higher-margin products, and so on. We here at FCNews decided we may be able to help, too. So the idea of publishing a guide with ideas to help retailers through tough times was born. But for it to have value for retailers, it would have to be different; it would have to be fresh. So in this issue you’ll find many ideas to consider. Whether it be in terms of advertising, promotion, financing, customers or employees, there are some unique ideas, many of which were culled from other industries. Whether the subject matter was researched by FCNews staff or written by other journalists, I think much of the material will give retailers something to think about and in many cases help their businesses. We also asked the issue’s nine sponsors to submit brief articles that would drill a bit deeper-what their specific company or group was doing to help retailers in this challenging climate. I think you’ll find this information useful as well. Finally, a survival guide would not be complete without an economic forecast, which you’ll find in the article 'Economic Forecast: Beyond hope and into the realm of reality'. There are thousands of economists out there, and it seems each has his or her own unique perspective. But Alan Beaulieu, senior analyst, economist and principal of the Institute for Trend Research since 1990, stands out. I’ve seen him speak at the annual NAFCD conference two years running, and his projections have been dead on. He accurately predicted this recession before we got here, explained the hows, whys and whens. A few highlights of his current views: • The rate of decline is easing. “We remain six to eight months away from recovery, and that recovery will be mild. 2011, however, will be a good year economically. • Three of the eight indicators the Institute for Trend Research follows are showing positive signs. When five of those are positive, the Institute will consider a recovery to be under way. The three showing positive signs are: money supply is increasing; bond prices are rising; and the ISM Index, though still in contraction, has been gaining for three months straight. • U.S. housing markets will reach a low in late 2009 or early 2010 when prices flatten out before rising again in 2011. • Unemployment will peak in early 2010 above 9% nationally. Job growth should begin around September 2010. • Credit conditions will improve somewhat in 2010, when we should see renewed lending at low interest rates. • The value of the dollar against other currencies won’t change much from now through the end of the year. Simply put, if you implement just one idea from this issue, it will have been well worth the effort. As for advice, the middle of 2010 will be a golden time to expand your operation. New and used equipment will be inexpensive, real estate will be inexpensive, interest rates will be low. Start planning your expansion now. • Borrow as much money as you can in 2010, as conditions may not be as favorable in the years to follow. • Stop activities that don’t create profit, such as seminars, services or other things that lose money for your company. • Eliminate products that aren’t profitable. Get rid of that which doesn’t serve your business. |