Sourcing Journal’s Sustaining Voices podcasts provide lively discussions about the creative innovations, scalable solutions and forward-thinking initiatives that are spinning intent into action.
The COVID-19 crisis has resulted in a period of unprecedented upheaval for the retail industry, which has fielded a battery of hits due to shuttered storefronts, retreated foot traffic, shrinking discretionary incomes and mounting economic uncertainty. Brands and retailers have to contend with collapsing revenues, rent payments and mountains of unsold merchandise. Does something need to change?
In this episode of the Sustaining Voices podcast, Sourcing Journal reporter Jasmin Malik Chua speaks with Gregory Schlegel, founder of the Supply Chain Risk Management Consortium, and Nikki Baird, vice president of retail innovation at Aptos, about how the retail supply chain can adapt to a post-pandemic landscape that will look markedly different from the one that came before.
Inventory and pricy real estate have long been two of retail’s biggest albatrosses, but they haven’t changed because there’s been little motivation to change them. COVID-19, however, is presenting them through a fresh lens. “Those are the places where the pain is the greatest right now,” Baird said. “There’s a lot of, ‘Well, we’ve always done it that way’ in the apparel supply chain, but the pandemic has really exposed the weaknesses in the way we’ve always done it.”
Brands and retailers, for one, can no longer muddle along with the limited visibility they’ve always had, Schlegel said. “The retail supply chain is in need of massive investments in people, flexibility, visibility and automation to survive, thrive and become more resilient,” he said. “As retail and apparel move through COVID-19, they can’t bring these historical supply-chain inefficiencies along with them.”
Before the pandemic, fashion businesses were experimenting with inventory-less stores that trafficked in experiences and branding rather than saleable merchandise. The pandemic may accelerate such innovations, including those borne out of necessity, such as buy online, pick up in store and enhanced ecommerce platforms punched up by video-enhanced bells and whistles and personalized assistance. Many of these changes are likely to have staying power, and as the borders of online and offline begin to blur, consumers will increasingly look to stores—even physical ones, whenever they reopen—to be more than repositories of merchandise.
“There’s no future for stores, whether they have inventory or not, without that aspect of entertainment or expertise or some kind of guidance or interaction,” Baird said.