Grow your operations by following these trends!

With 2016 already in full swing (and the busy December period now past), retailers may be asking themselves what they should focus on this year to achieve growth in their operations. With the current economic climate and the rand struggling, it is more imperative than ever for retailers to gain growth wherever possible. So what are some of the trends retailers can aim to focus on this year to achieve that much needed growth?

Trend 1: Yesterday’s shopping patterns are gone forever

The consumer tendency to do one large monthly shopping run is decreasing drastically. With more couples working full time, convenience purchases are on the rise. Consumers are visiting retail outlets up to four times a week to purchase convenience foods and to purchase any other must needs for that day. Due to this, retail operations are having to now compete against fast food outlets. To combat this, retailers should be focusing on improving their convenience food departments – with a wide offering and high attention to presentation.

Trend 2: Volume growth is negligible

With retail growth extremely low, and projections of less than 2% growth in retail, retailers can find growth in new store openings. By focusing on niche requirements in certain areas, retailers can customize their offering per store to maximize growth. By opening stores in multiple locations, retailers can also take advantage of the first trend presented here by offering localized convenience stores rather than one central store.

Trend 3: Grocery store numbers are increasing

With a desperate push by retailers to achieve rand growth, retailers footprints have risen on average by 10%. Given growth is still not being achieved, this leads us to the harsh conclusion that retail numbers are down. How can retailers then achieve growth within their existing stores? A trend for retailers to follow is to focus on store presentation, staff service and gain higher efficiency.

Trend 4: Brands have a troubled future

Internationally, many of the “destructible” brands we know are decreasing volumes by up-to 2% annually. With the increase in popularity for craft and artisanal products, retailers can combat this decrease in their popular brands by focusing on offering a diverse range of “authentic” products. For those retailers also in the liquor industry, a focus should be on craft brewed products.

Trend 5: Rural area spending is increasing

An increase in the South African middle class has seen an increase in retail spend in urban areas. Rising populating numbers in rural areas has however opened up an opportunity for retailers to take advantage of the increase in rural retail shopping.

With retail entrepreneurs seeking to increase growth by opening more stores and in some cases a smaller footprint dedicated to the local neighbourhood preferences, it is becoming more and more important to have an accounting solution that can offer immediate access to: dashboard analysis of the critical store pulse-points, sub-departmental GP comparisons and consolidated profit / loss views of the multiple stores. In essence, it is has become much more about ‘mining’ for greater GPs that maybe hiding in the diverse product range and shopping preference. With the push into Africa (e.g. exhibited by Shoprite) greater demands will be made of the accounting solution to permit cross-regions consolidation & market segmentation analysis.

All these trends allow potential for retailers to increase the rand growth of their operations even with the economic crises we are experiencing. So the big question is, how will you take advantage of these trends to increase your growth during 2016?

Source: Adapted from http://www.supermarket.co.za/SR_Downloads/S&R%202016-1%20Retail%20review.pdf.