Four Trends in Retail to Watch in 2022
With the general economic environment chaotic, retailers need to be on their A-game this year to make sure they can stay profitable. Here are four trends to watch for in the latter-half of 2022.
- Consumers tightening their beltsRising inflation, interest rates and fuel prices mean many consumers are having to monitor their spending more than in previous years. We should expect consumers to try and cut their spending on non-essentials like expensive clothing and electronics so they can afford their higher fuel and food bills. In fact, the Federal Reserve has indicated that it is willing to allow a moderate recession to occur to prevent runaway inflation. If this should happen, we need to prepare for a large drop in consumer spending. You can mitigate this factor by shifting your offering to lower cost options that will appeal to consumers in a market where everything is getting more expensive.
- Increased cost of supplies Of course, these rising costs do not just affect the consumer side, they also effect retailers. The entire supply chain is under incredible stress right now due to bottlenecks caused by the Russian-Ukrainian war and continued anti-Covid lockdowns in China. Expect higher costs and longer lead times to bring in your inventory. To deal with this you will have to be pro-active in reaching out to your suppliers to negotiate the best deals possible and order inventory earlier then you normally would so you can make sure it arrives on time.
- Increased difficulty in finding staff Anyone who has tried hiring recently can testify to the difficulty of finding workers. The unemployment rate is at a record low and with many workers moving to work from home jobs it can be difficult for retail stores to find enough staff. Some ways you can cope with this is by broadening who you would consider hiring. Look into hiring people without prior job experience or ex-convicts. You could also consider shortening your store hours to lower the number of employees you need.
- Increased theft Anytime there is economic trouble theft increases, especially retail theft. We saw this during the pandemic where according to the National Retail Federation’s 2021 National Retail Security Survey 57% of stores indicated an increase in theft from previous years. Do not expect for there to be any relief from this with the pandemic’s end as rising inflation is driving people to steal instead of pay. The best way to counter this is by investing in anti-theft systems. The INEO Clarity starter package is a fantastic way to put thieves on notice that you are not an easy target to steal from.
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