Retailers turn to expanding physical footprint post-COVID with regional support from Retail Pro Business Partners
After two years of isolation, customers are ready to visit retailers, and stores are more than ready to greet them as they look to expand operations.
Anticipating pent-up demand, retailers are looking at not just beefing up their square footage but also global expansion to meet customers’ demands for exceptional selection and outstanding experience.
The recent past has been tough on retailers: COVID magnified existing weaknesses, accelerated emerging trends of increased online shopping, and forced organizations to adopt new technology faster than they had anticipated.
Approximately 40 million workers were furloughed or laid off as demand dipped and factories and offices were closed to prevent the spread of the virus, according to Deloitte.
Additionally, people stopped traveling and leaving their homes to shop: Business Insider reported an 82.6% year-over-year foot traffic plunge for the week ending April 18, 2020. E-commerce took hold as brick and mortars complied with government mandates to close.
Retailers that had entertained physical expansion plans in 2020 quickly course corrected and invested in online sales platforms to try to make up lost revenue. That strategy – which included click and collect and curbside pickup — helped many physical locations remain in business.
As the pandemic waned and retailers reopened, they started streamlining operations to ensure that their physical stores were in sync with their online systems, which had become more robust during the last 24 months.
Retail Pro Prism’s omnichannel retail management platform gives retailers the tools to monitor their inventory across channels, keeping in-store and online records in sync. The operations were often merged into a hybrid store/warehouse, in which online orders could be fulfilled by the stores’ brick and mortar locations.
Strategies to expand revisited
With those new logistics in place, retailers are once again considering and moving ahead with physical expansion. But, for the largest, most well-known names, creating more big stores isn’t in the game plan.
Instead, smaller, more boutique-type stores that focus on the customer experience is the winning strategy.
Take Nordstrom’s, which even prior to the pandemic offered curbside pickup and has continued to strengthen its integration between online and offline channels.
Nearly five years ago, Nordstrom Local launched. The stores are roughly 3,000 square feet and do not carry dedicated inventory, but instead are focused on service: Amenities include complimentary personal stylists, eCommerce order pickup, returns, alterations, gift wrapping and complimentary refreshments.
Betting that less space could pay off more was a good gamble: On average, a Nordstrom Local customer spends 2.5 times the amount of a regular Nordstrom customer.
The retailer sees the locals as a way to complement their existing larger stores, and cater to customers more conveniently.
Post COVID, many shoppers are looking for convenience, particularly when at brick and mortars.
The fundamental reasons for shopping in person haven’t changed: They enjoy social interaction and they want to interact with products before purchasing.
However, shoppers may now be a bit more exacting in what they expect from retailers’ service.
Businesses looking to expand their physical footprint must be certain that their existing software can handle the new load.
POS software, in particular, must be scalable in order for the business to remain efficient.
Retail Pro Prism is a scalable, comprehensive software package that can be cloud-based and offers remote support — ideal for an expanding company.
For example, Miniso UK currently has seven stores and has plans to grow its business with Retail Pro Prism to 50 stores in five years. “As you grow, you need clear visibility on all parts of the business and we want to ensure we’re not letting down one side of the business at the expense of the other,” said Miniso UK’s Chief Operating Officer, Saad Usman. “To be successful, we have to develop the online and offline experience simultaneously, which we’re trying to do.”
Growth Requires Local Support
Once software requirements have been established, retailers should consider their support options. Having local IT partners can help ease concerns and create an atmosphere of camaraderie.
Retail Pro has a Global network of local IT support partners in 130 countries, helping their clients with implementations, integration of retail solutions including loyalty, ERP, ecommerce etc.
Local partners also know the region better than anyone, so they can assist with localization of the software for language and branding, and are familiar with legal requirements, such as fiscalization (fiscal law aimed at preventing retailer fraud) as well as tax reporting.
Retail Pro is compliant with regional fiscal and tax requirements such as VAT used in many regions globally, India’s GST, Canada’s GST/HST and Brazil’s ICMS, and various tax zones.
In addition, any software that a growing retailer selects should be “expansion-friendly.”
Retail Pro’s robust API provides centralized flexibility that adapts to local regulation variations, allowing retailers to customize their retail POS systems to specific regional requirements.
For more than 30 years, Retail Pro has provided a base platform and API that supports regional requirements, which are specific to a retail management system and point of sale.
From the UX –where local language support is key– to the more complex needs of taxation and reporting requirements, localization has and continues to be part of Retail Pro’s DNA.
Globally, language can also be a business barrier. Because all languages have a vernacular, idioms and regional “quirks,” Retail Pro has a fully translatable user interface, so translations can be tailored toward local dialects for a given region, specific business or vertical type.
Finally, partnering with the right IT solution provider is critical for retailers’ success domestically and abroad – and the right fit can help both companies grow, especially if they operate with similar values.
Authorized partners are not only trusted technology advisors, but they are also serving as IT project managers for store launches in different regions of the same country as well as coordinating store launches in new countries.
Establishing mutually-beneficial goals motivates all parties. Post-COVID, analysts expect the global retail market to reach $39,933.3 billion in 2030, up from nearly $20,331.1 billion in 2020. Retail implementation of regionally-savvy software and partnerships with local solution providers will be crucial for success.