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While economic indicators and stock-market activity point to signs of improvement for the industry, retailers should still brace for a modest and unpredictable recovery in 2010. Bolstering this forecast, retailers reported impressive Black Friday and Cyber Monday numbers; with 195-million shoppers visiting stores and Web sites over Black Friday weekend1 and approximately 96.5-million shoppers logging on during Cyber Monday2. But despite these promising numbers, average spending per person still dropped $30 from a year ago.

"Although these signs point to an economic recovery, results from the holiday shopping season clearly indicate that while the number of shoppers increased from the year prior, frugal spending habits may remain the new normal," said Wayne Usie, senior vice president, retail, JDA Software. "With this smaller pool of consumer-spending dollars, retailers that can adjust their supply chain and merchandising operations to accurately meet consumer demand can rise above the competition."

Below, JDA Software outlines critical strategies for retailers to navigate the long-lasting impact of the recession, respond to opportunities associated with the current recovery and lay the foundation for future growth:

• Focus on demand – Retailers have an opportunity to take a page out of their manufacturing partners' playbooks and apply the disciplines of demand planning to supply chain operations. By integrating time-phased demand planning practices into their merchandising processes, retailers can not only predict "the how much" but also "the why" behind consumer demand. When created in collaboration with suppliers, a time-phased consensus demand plan can drive all merchandising activities, at any given time or season, for a true integrated planning and execution operating model. This allows retailers to more effectively respond to consumer demand, balance their inventory investment with their sales goals and transition their businesses to effectively manage a complex supply chain with one synchronized view of demand.
• Implement localized assortment planning – Accurately aligning product selections with changing customer preferences has become more challenging than ever. Traditional "broad-brush" planning and buying strategies based solely on historical data are no longer effective when it comes to offering consumers the right products. Retailers must become more market specific with their assortments – utilizing local preferences and aligning with the purchase patterns of each store's unique customer base. They can also optimize product selection by adopting processes and technologies that efficiently generate tailored plans that match established product-classification strategies.
• Adopt localized pricing – Gone are the days of zone or corporate-pricing strategies that operated in a vacuum. In order to capitalize on the recovery, retailers must price, promote and mark down items according to local consumer demographics, purchase preferences and competitive activity to achieve maximum value. They must also tie pricing changes all the way back to demand plans to ensure that inventory is readily available. By synchronizing regional promotional planning and pricing, retailers can improve overall performance and keep customer-satisfaction levels high.
• Apply localized space allocation strategies – After tailoring assortments and setting prices based on market-specific drivers, the next step is to ensure premium floor space is allocated to the ideal mix. If shoppers can't easily find exactly what they're looking for quickly, retailers risk lost sales and dissatisfied customers. Ideally, every square foot of selling space should be optimized – including product positioning, performance and layout – to be as profitable as possible.

By applying time-phased demand planning to create one synchronized view of demand, retailers can turn their supply chains into an economic advantage. Once this has been accomplished, catering to market-specific consumer demand will build customer loyalty – a critical strategy as consumers find themselves with more discretionary income as the recovery continues.

JDA Software to Showcase Retail Strategies and Industry Leadership at the NRF 2010
Retailers today need real-world strategies and advanced technology that provide the fastest ROI, help them to achieve a competitive advantage and support total business transformation. JDA will highlight its industry-leading solutions, thought leadership and winning strategies for retailers to successfully adapt to today's challenging business environment at the National Retail Federation's (NRF) 2010 annual "Big Show." Based on the positive feedback that the "Anticipate. Plan. Deliver." theme received at NRF 2009, JDA is expanding on that theme to help companies become more consumer driven. Visit JDA at Booth #1613 to learn how to move toward demand-driven retail planning and execution, increase revenue and deliver quantifiable results to your bottom line.

To learn more about how JDA Software's solutions help its customers effectively navigate the recession-recovery cycle, please visit JDA at NRF or go to www.jda.com.

1 "Black Friday Verdict: As Expected, Number of Shoppers Up, Average Spending Down", National Retail Federation, November 29, 2009

2 "Number of Americans to Shop on Cyber Monday Nears 100 Million, According to Shop.org Survey", National Retail Federation, November 29, 2009

About JDA Software Group, Inc.
JDA Software Group, Inc. is the world's leading supply chain solutions provider, helping companies optimize operations and improve profitability. JDA drives business efficiency for its global customer base of more than 5,800 retailers, manufacturers, wholesaler-distributors and services industries companies through deep domain expertise and innovative solutions. JDA's combination of unmatched services, together with its integrated yet modular solutions for merchandising, supply chain planning and execution and revenue management, leverage the strong heritage and knowledge capital of market leaders including Manugistics, E3, Intactix and Arthur. When supply chain results matter, companies turn to JDA. For more information, visit www.jda.com.

SOURCE: JDA