The retail industry has always been subject to changing trends and designs. As advances in communications and global connectivity continue to grow, retailers have had to embrace a changing dynamic that includes shifting consumer preferences based on the latest trends, global economic uncertainty and vast online options. All retailers must balance factors such as brand image, price, quality, location, marketing savvy, expense tracing and nimble inventory management to maintain typically thin profit margins.
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However, successful store owners employ lean retailing practices, in which they replenish and refresh inventory continually across many selling seasons. But this business model requires careful product tracking and “just-in-time” inventory systems so you can keep hot selling merchandise in stock to meet the needs of an increasingly demanding and savvy customer base. Consumers are more demanding, and the Internet has made them more style and price savvy. They expect the right products at the right time in the color and size they want. The challenge is to meet their demands while keeping your inventory up to date with the latest trends and brand refreshes, all while avoiding getting stuck holding inventory that has already outlived its shortened life cycle.
On the other hand, a brick and mortar store have a relatively high overhead and cost structure. Combined with the unpredictable effects that economic fluctuations have on consumer spending, it can be a challenge to keep expenses as low as possible in an effort to manage razor thin profit margins. It’s important to pay attention to the overall economy because when the economy is down, customers may turn to budget retailers in an effort to stretch their dollars. During boom times, spending on luxury items such as jewelry, designer handbags and high fashion brands can go up. The hard part is the unpredictable nature of the economy and how the ebbs and flows may affect your specific business model.
Furthermore, product brand consciousness extends to the brand image of a store. Their success depends on repeated business from loyal customers and a big part of building that kind of clientele is a professional marketing and advertising program that includes strategic product promotion efforts. Retail is often brand conscious, with customers searching out the best prices for specific brands. The consciousness extends to the store’s brand image as well. Repeated customers are so important to a small store’s success that if you fail to build a loyal customer base, you might be forced to close your doors. Also, learning to identify your target customer base and then build the store brand to cater to that clientele or reach out to customers when a particular product you known they like comes in. Offer loyalty and referral programs so you long-term customers can help you reel in new customers. Maintain a vibrant online presence, including a brand website with or without an e-commerce component, and social media accounts such as Facebook, Twitter and Instagram.
In closing, organizations are at risk every time they open their doors for business. On any given day, an employee ma be injured, a customer may have an accident, or a consumer may be injured using the organization’s product. Risk is a specific contingency or peril. Because the situations that put organizations at risk can be so expensive when they do occur, many organizations employ risk managers. They work closely with safety and health personnel to reduce the risk of accidents and injuries on the job. They also work closely with insurance companies to achieve the most effective transference possible.
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