Embracing The New World: Challenges And Options For RetailersSource: CitiXsys Technologies Ltd.
In recent months a general sentiment of optimism has been shared by most. The turbulent recessionary months appear to be almost behind us with a display of renewed confidence amongst businesses as well as consumers. Government bailouts and the overhaul of economic policies have boosted consumer confidence, the effects of which appear to be influencing decision making amongst Small and Medium sized Enterprises. Small or medium as they may be, they represent the lower segment of the pyramid. However, by virtue of their status they also represent the foundation for their larger counterparts.
For the overall economy to eventually resemble a "V" shape in economic recession and recovery charting (a sharp decline in economic measures followed by a sharp rise to its previous peak) or for that matter a "U" shaped recovery, industry must perform at the highest level possible to ignite the market. At the heart of all this is the consumer. All the good work by governments will only sustain the economy if the consumer starts spending. Large-scale job losses and reductions in incomes are still so vivid in the minds of consumers, affecting consumer willingness to return to the same level of spending experienced prior to the Global Financial Crisis. Consumer spending habits have changed in today's markets. What we are seeing today is a trend where consumers are generally positive and happy with a slightly lower quality product simply because the price tag is attractive. Still consumers appear generally happy with the alternative.
The economic downturn has led the customer to be far more demanding and retailers must be ready to accept these pressures and meet customer expectations. Added competition today provided by on-line retailers has also contributed to retailer's challenges as numerous product comparison sites – though enabling the customer to get their money's worth, by the same measure exerts enormous pressure on the retailer to have an optimized warehousing & distribution system.