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  OCTOBER 2013

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Retail Holiday Outlook Calls for an Elusive Customer Experience

Bryan Nella, GT Nexus

Holiday forecasts have started flowing in and, as always, there are an endless number of perspectives. They always seem to be a mixed bag, sometimes contradicting each other. Based on what's being reported this year, here's what we can expect:

  • Fewer retail employees in stores
  • Fewer customers in stores
  • Significantly more shopping online and via catalog

Here are a few recent headlines alluding to these expectations:

Retailers Expected to Hire Less Holiday Help
USA Today, Sept 23, 2013

Shaky consumer confidence and cost-trimming by stores may stop 2013 holiday seasonal hiring from reaching last year's 12-year high, global employment consulting firm Challenger, Gray & Christmas reported Monday.

Retailers are expected to hire roughly 700,000 temporary employees for the Oct. 1 - Dec. 31 holiday season, the Chicago-based company said. That would fall below the 751,800 hired last year. The 2012 total was up 14% from prior year and marked the fourth consecutive increase in holiday hiring since the national financial collapse.


Forecast Envisions a Weak Holiday Season
Wall Street Journal, Sept 17, 2013

An early forecast predicts the holiday-shopping season will be the worst since 2009, mirroring the concerns of some retailers who are stepping up discounts and pushing earlier for what they fear will be hard-fought sales.

ShopperTrak, which measures store traffic in 60,000 locations world-wide and crunches other data to come up with its forecast, expects retail sales in November and December to rise by 2.4% from a year earlier, less than the 3% increase in 2012 and below the gains of around 4% in 2011 and 2010.

Retail Holiday Sales May Jump 4.5%
Bloomberg, Sept 23, 2013

Retail sales are projected to increase as much as 4.5 percent this holiday season, in line with last year's gain, as a rise in home prices and decline in joblessness keeps consumers spending.

Total holiday sales are expected to rise to $963 billion to $967 billion, led by non-store sales from online and catalog retailers, Deloitte LLP, a New York-based consulting firm, said today in a statement.

One common theme that each of these forecasts points to is the idea of retailers running leaner operations this holiday season, relying less on foot traffic in-store and more on e-commerce and catalog sales. 50,000 less temp hires will be made due to slower customer traffic. Store shopper traffic is expected to decrease 1.4%. This adds up to leaner staff and leaner in-store inventory, which adds up to stockouts and frustration in store aisles.

However, retail sales overall are expected to increase - some forecasts calling for a 4% increase versus 2012. This increase is led by non-store sales from online and catalog retail. On the back-end of the business - the supply chain - being lean is not going to be enough. In fact, it can be dangerous. Lack of inventory will lead to missed opportunities. This holiday season retailers will have to be agile, responsive and connected in the supply chain to know where all inventory resides and to make the smartest possible decisions to ensure goods can be delivered as promised. Inability to see and track inventory that sits in factories, distribution centers, and en route will result in a disappointing customer experience this holiday season. Leading up to the final shopping days of the year, the leaders in supply chain execution are likely to see huge dividends through surging online sales. Those who fail to fully integrate and connect the back end will be exposed in late December.

Bryan Nella is Director of Corporate Communications at GT Nexus, the world's largest cloud-based supply chain network. He has more than 12 years of experience distilling complex solutions into simplified concepts within the enterprise software and extra-enterprise software space. Prior to joining GT Nexus, Bryan held numerous positions in the technology practice at global public relations agency Burson-Marsteller, where he delivered media relations and communications services to clients such as SAP. In previous roles he has worked with clients such as IBM, MasterCard and U.S. Trust. Bryan holds a BA in Mass Communications from Iona College and a MS in Management Communications from Manhattanville College.