Kega

Absolutely essential in all this is a merchandise department that keeps daily track of the sales and reports on the turnaround speed and the effect that the price has on this. Dynamic pricing is not something for the future, it’s for right now.

This brings us to the next essential component: the role of data. Modern retail organisations measure everything. And we mean everything. Information on revenue, the effectiveness of marketing efforts, customer behaviour, stock levels, performance in logistics. You name it, it’s measurable. All this information has to always be readily available to help make quick and well-founded business decisions. 

Whereas the gut feeling of the entrepreneur or CEO is often the leading factor in traditional retail organisations, it has far less influence on the decision-making process in modern organisations. Experience and instinct are still important, but increasingly serve merely as input for a test. This means that more business decisions are supported by data, as opposed to basing them purely on assumptions and intuition.

The speed at which decisions are made is (much) higher in successful retailers than it is with their traditional counterparts. For many of these conventional organisations it is customary to hold meetings with stakeholders, for example a commercial meeting, every three to four weeks. Many modern businesses do this on a daily basis, mostly just to quickly go through the figures and adjust where necessary. Getting everyone together in one room every day is almost impossible to do, but video conferencing is an ideal substitute.

All these changes also ask more of the staff in the way of independence, and therefore also demand clear job descriptions on which the staff can be assessed. The increased role of data, too, asks for a different type of staff at the head office. The emphasis in the stores is leaning more and more towards service and less on pure sales. This does raise the question whether that number 1 salesperson will still be the best employee in the future.

The most important condition to be a successful retailer in the second decade of the current millennium is, however, a Board of Directors that actually understands what’s happening on the market. And one that has the guts to convert the changes the company needs into policies. This means it is also necessary for the changes in direction to be clear to the entire company, both in words and action. No support means no change.