Retail Wars: How Some US Stores Are Fighting For Customers
The consumer market in America is one of the largest industries in the country. There are over 14 million people working in retail in the US. That is a huge section of the population. As with any consumer-driven market, retail in America is subject to change at any time. As consumer demands change on a day to day basis, many stores find it hard to stay afloat. The financial crisis in the US meant that a great many of the luxury stores in the country had to close down. With consumers buying less luxury and special items, there was no longer a need for such stores to exist.
One sector that was always safe from this threat is the core sector. The sector includes supermarkets, clothing stores and basic commodity outlets. In short, any store that sells things, which people need on a regular basis, was safe. That meant that supermarket officials and entrepreneurs had no reason to worry. Now, though, it would appear that the sector has a new threat. In the last year or two, people have stopped buying as many things. Many households have cut their monthly expenditure by half since 2012. That means that stores are now having to compete for what little business there is. The trend has meant that top name retailers have adapted to a new climate.
The Main Retail Market
The main retail market in America has always been strong. The US is famous for its consumerist society and, as such, the retail industry has always been lucrative. With more people cutting back than ever before, there have been some drastic changes in the sector. Many top name retailers, such as Walmart, have had to rethink their business plan. Any good business has to learn to adapt to new situations. Over an extended period, every single market changes. As such, many business owners have to find new sustainable ways to keep customers while still making a profit.
In the current climate, it will take more than just new ideas to sustain businesses. Many of the retailers in America are taking their business online and abandoning retail stores. Doing so means that they can reach a whole new market without having to pay for the running costs of stores. This idea is just one way to go, and whilst it may work for some, it will leave others far behind.
Undercutting The Competition
In the world of retail, there is no technique as great as undercutting the competition. Doing so means selling the same products as competitors, but for lower prices than the competitors. As long as retail has existed, businesses have undercut each other by way of pricing. That in itself has lead to a series of price wars. In the US, many competing companies have closed stores in favor of offering their customers lower prices.
An example of this is an ongoing war between Staples and Office Depot. The two retail chains sell the same stock at similar prices. When you look at the two chains, you will find it hard to distinguish which is better value for money. That has meant that the two companies have a huge problem. In a bid to win more customers, both companies have cut their prices over the last year. That has lead to stables closing 15% of its stores in the country, whilst Office Depot has yet to close any stores. Industry experts believe that Office Depot will soon be closing down a few stores across the country. If you take a step back and look at the bigger picture, you will see what that means for society. The average retail store employs around 50-60 people. That means that hundreds of people lost their jobs as a direct result of an ongoing price war between the two rivals.
Improving Services And ‘Wait Times’
When customers have such a wide variety of stores from which to choose, they have to find reasons to choose one over the other. One of the main factors that impact people’s decision is the level of customer service they receive and how long they have to wait. That means that many companies across the US have pumped a lot of money into improving their speed and customer service. One thing that causes people to wait a long time for service is old tills and slow technology. Some of the leading retailers in the US have invested money in new till systems. One system that is in high-demand is the comes from further afield. The UK POS till system solutions are far superior to other systems. That means that many companies in the US have installed the system as standard in their stores.
Improving customer services has also been top of company executives agenda over the last few years. It is now mandatory for staff in many retail stores to attend annual training seminars. These seminars seek to improve the level of service each staff member gives to customers. Executives hope that the new till systems and staff training will go some way to saving the stores and keeping customers.
Extending Opening Hours
The final way in which the changing climate has changed retail is by changing opening hours. Many retailers have opted to stay open for longer during the evenings and weekends. The fact that budgets are tighter than ever before has meant that the retail executives can’t afford to put extra staff on the rota. That means that existing staff members have extra strain to deal with when they are at work. Many employees are willing to work extra hours so that they can gain job security. That means that many of the people who now work in retail in the US are underpaid and over-worked. The extended opening hours should help companies to maintain their current customer base. The problem is that in extending hours without paying employees any more money, companies might fail. It would appear that executives are stretching their resources too far with no solid plan for the future.