Post Covid Retail – Rethinking store processes & merchandise management

A healthy store P & L is still at the heart of happy retailing. As Covid-19 made it somewhat easy to lower rent costs, many took the same approach with store head count. But this will certainly cost future retail productivity and flexibility.

So how do you adjust store operations in Post Covid Retail without losing more sales and compromising customer service?

The solution in post Covid Retail is simple. Healthy personal cost ratios can be achieved with stock density and store process adjustments. With less personnel in store, processes within opening hours must be changed so that employees can provide at least the same customer service as they did before the pandemic.

Understanding why this is needed is straightforward, but the way to get there requires a little more effort.

Many calculations have and discussions took place to find the “right” store cost of the future (photo: headway in unsplash)

Post Covid Retail: Implementation by priorities

There are three things you should focus on after you intend to adjust staff resources without losing productivity.

Merchandise Management

First steps: Re-defining your store’s density and weeks on hand in the store per product group, including the number of campaigns plus maximum target stock in pieces per store. Key figures are to be made calculable for the expected workload in the store. Less rearrangement work and transfers to store storage, central warehouse, and other stores reduce staff working hours. On top of this, it reduces mark downs.

Typical brand store merchandising tries to show the brand’s full range, instead of focussing on the likely bestsellers. In the past that strategy might have been ok, but in post Covid retail, that could secure the death of the store. You simply don’t have the personnel anymore to handle incorrect merchandise, or too much of it.

As beautiful these decorations have been, with less store personnel in future they become a burden to maintain its quality (photo: brand pilots)

Store Shipments

Store deliveries to be processed should be limited to max 3 times a week and must be “floor-ready-merchandised”. With UPS, and DHL no longer guaranteeing regular store deliveries (except for Amazon), you can’t simply repair poor central planning with daily replenishment. You have to merchandise and plan smarter.

The post man does no long stop at your store step every day. That requires better planning to overcome stockouts (photo: Claudio Schwarz in unsplash)

And don’t forget, with the visual merchandiser no longer regularly visiting the store, your guidelines need to be as simple as a children’s book. Digital guidance via Webinar can be helpful, but make sure it’s simple, not fancy.

Workforce Management

Frequency counters are a must for planning customer service. But given lockdowns and health safety regulation different from city to city, it has been increasingly difficult to forecast and plan. In Post Covid Retail, that uncertainty may stay for another 2-3 years, which just re-confirms how essential it is to stay flexible with personnel capacities. Plan in any case outside the box (see an early post on that topic).

Post Covid Retail

Plan retail outside box, see an early post on that topic (graphic: brand pilots)

Overhead Communication Diet

You don’t get any idea how many (useless) mails reach the store and create extra workload already in normal times. Post Covid Retail less area managers, VM or others visit the store. What does that do to the digital store communication? It triples mails, Whatsapp, Video Calls…. If you don’t want your fewer personnel to spend 50% of their working hours dealing with HQ, take control over communication. It could even be that you need headquarter “communication quarantine” to truly improve store operations. Retail employees completely offline can focus on customers in store.

Control how headquarter communicates with store personnel (photo: Zan Am in unsplash)

Wrapping up Post Covid Retail

In Post Covid Retail, a store’s stock density is the number one driver for retail personnel cost. At the same time, the store manager’s resources are as low as never before. That requires the very best retail operations planning ever, for brand stores and multi brand retailers alike. Adjust your way of planning.

Because, it is not the strongest that survive, but those who adapt most.

About the author

Rudolf Bartels has cultivated a passion for efficient retail operations throughout his entire retail management life. Keeping stores simple, smooth, cost efficient and profitable was almost like a religion to him.

Guido Schild shares with Rudolf the wealth of experience and passion for retail. To speak about your passion you reach them via linkedin (Rudolf Bartels, Guido Schild).

One thought on “Post Covid Retail – Rethinking store processes & merchandise management

  1. Anonymous says:

    Great post.

Leave a Comment

Your email address will not be published. Required fields are marked *