Archive for November, 2009

Retail social media site

November 27, 2009

In October we launched Accelerated Community, a social networking site for retail professionals interested in keeping up with industry trends, learning new methods for analyzing point of sale data, and networking with other thought leaders. So far we have over 200 members and we are experiencing strong week over week growth. We believe social media can be an effective customer support tool as well as a way to connect broad groups of retail professionals to learn from each other. If you are interesting in a complimentary membership you can learn more at http://tiny.cc/OuqBK

Nordstrom to Spend $45 Million on Tech Upgrades in 2010

November 24, 2009

Nordstrom recently announced its plans to invest approximately $40 to $45 million in technology upgrades next year, maintaining its level of IT spend year-over-year.

Over the past year, the luxury department store has been heavily focused on evolving its multi-channel business. Its steadfast focus on evolving its multi-channel has clearly paid off since the luxury department store most recently reported in its latest quarter that sales for its online Nordstrom Direct business increased 16.4 percent.

The department store also has recently updated its inventory platform so online orders could be fulfilled from the stores or any Nordstrom location.|

According to Blake Nordstrom, President and Director, Nordstrom, "This continues our ongoing effort to improve our customers’ experience by providing them with greater access to more of our inventory whenever and however they want to shop."

Nordstrom continues, "For the customer to go online and be able to leverage the entire inventory throughout the company represents tremendous opportunities. There’s significant learnings that are coming from this about our allocation of inventory and, again, our supply chain, but we view it as a real positive and view it as another confirmation on behalf of the customer in the feedback that they’re giving us that this multi-channel strategy is super important to our future growth."

The Conference Board: Consumers to cut back on gift spending

November 24, 2009

NEW YORK (Nov. 23) According to The Conference Board, U.S. households are expected to spend an average of $390 on Christmas gifts this holiday season, down from last year’s estimate of $418.

"Consumers are approaching the holiday season very cautiously," says Lynn Franco, director of The Conference Board Consumer Research Center. "Job losses and uncertainty about the future are making for a very frugal shopper. Retailers will need to be quite creative to entice consumers to spend, both in stores and online this holiday season, as consumers most certainly will expect major markdowns and bargains."

The top spenders will be New England households (Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island, Vermont) who intend to spend an average of $534. Lowest Christmas spending will be in the Mountain region (Arizona, Colorado, Idaho, Montana, Nevada, New Mexico, Utah, Wyoming) where consumers intend to spend $332 on Christmas gifts.

Only 26% of all households intend to spend $500 or more on Christmas gifts, down slightly from 27% last year. Among other households, 35% plan to spend $200 to $500, down from 37% last year, and 39% are planning to spend less than $200, up from 35% in 2008.

Consumers will also approach online holiday shopping very cautiously, holding off on big ticket items and holding out for major incentives like free shipping and discounts, according to The Consumer Internet Barometer, a separate survey produced quarterly by The Conference Board and TNS. The Consumer Internet Barometer surveys 10,000 households across the country and tracks who’s doing what on the Internet.

"Even as the economy is starting to show signs of improvement, consumers are taking a cautious approach to their purchase decisions, focusing on lower ticket items that clearly communicate value," notes Bridget Armstrong, head of Consumer Sector at TNS.

Budget-friendly items appear at the top of consumers’ online holiday shopping lists. The top categories include books, apparel/footwear, toys/games and movies/DVDs. The most preferred shopping sites are those operated by online retailers such as Amazon.com. Retail stores and catalog operators such as Walmart.com or BestBuy.com are a close second.

About 90% of online consumers cite free shipping as a major incentive. More than two out of three said special deals and offers not available in stores as well as coupons and discounts would encourage them to spend more.

Consumers will also approach online holiday shopping very cautiously, holding off on big ticket items and holding out for major incentives like free shipping and discounts, according to The Consumer Internet Barometer, a separate survey produced quarterly by The Conference Board and TNS. The Consumer Internet Barometer surveys 10,000 households across the country and tracks who’s doing what on the Internet.

"Even as the economy is starting to show signs of improvement, consumers are taking a cautious approach to their purchase decisions, focusing on lower ticket items that clearly communicate value," notes Bridget Armstrong, head of Consumer Sector at TNS.

Budget-friendly items appear at the top of consumers’ online holiday shopping lists. The top categories include books, apparel/footwear, toys/games and movies/DVDs. The most preferred shopping sites are those operated by online retailers such as Amazon.com. Retail stores and catalog operators such as Walmart.com or BestBuy.com are a close second.

About 90% of online consumers cite free shipping as a major incentive. More than two out of three said special deals and offers not available in stores as well as coupons and discounts would encourage them to spend more.

POS analysis for strategic value

November 19, 2009

Several recent meetings with vendors has highlighted a growing trend – POS data analysis has been and continues to be an operations imperative but vendors are increasingly finding strategic value in POS analysis. EDI 852 forms the foundation of the analysis with UPC and store level sales and on hand. But looking beyond sell thru and tradition metrics a savvy vendor can use the data to present to a buyer plan o gram compliance and even sales plans based on localized assortments. How many of your competitors do you think have that level of sophistication to present to a buyer? This is a great time to look beyond the regular use of EDI 852 / POS data and become a strategic resource to your buyer.
__________________
Chad Symens
Rainmaker Group
330-705-8703
* sent from my Blackberry

Wal-Mart Point of Sale Data Reporting

November 16, 2009

If you are a Wal-Mart vendor you have access to a wealth of data via Retail Link. As a service provider we work with allot of Wal-Mart vendors helping them to analyze the point of sale data made available by Wal-Mart through Retail Link. Sometimes a vendor will ask us “If I have Retail Link why do I need to hire someone to help me analyze POS data?”

Retail Link provides a method for getting POS data but as the vendor you will be responsible for transforming the data and you will need a database to store the data. Both of these are critical to provide for comp week and comp year comparisons which are the basis for accurate and insightful POS analysis. The complexity of building a database to store Retail Link data is more than most vendors want to bit off since it requires hardware, software, and IT skills to accomplish.

What can you do with Retail Link data if you have it stored in a database?

· Analyze SKU/store level sales

· Analyze SKU/store level on hand

· Analyze average unit selling price by SKU/store

· Analyze plan-o-gram compliance by verifying on hand and selling at traited and valid stores

· Identify out of stock stores, and even forecast demand based on prior sales

· Create SCRIPT forecasts for your buyer indicating where inventory is needed to maximize sales and avoid out of stocks.

· Group stores into A, B, C categories based on SKU level sales volume.

Wal-Mart buyers expect vendors to use Retail Link data to analyze and manage their SKU activity. If you are not already using the data, of if you are not using it as well as you could be then you are missing sales opportunities. Don’t wait for your buyer to call you and ask a question you can’t address – start working with the data today.

Learn more about what your organization can do with Retail Link data click here

Retail Sales Performance

November 15, 2009

The current retail environment is a subject of much discussion. The Accelerated Analytics team analyzes over 7 million units sold at over 650 retailers each week for vendors of consumer products and fashion items. For the last several weeks we have been seeing consistent week over week growth in all three categories. Here is a summary provided to members of our retail industry community for the week ending November 14, 2009. If you would like to view the full report and much more analysis you can join the retail industry community by completing this form. In the “Questions/Comments” area simply enter “requesting community membership”.

Total unit sales volume as 7.29 million units sold sales week across all categories. Week over week and comp year sales performance remain very consistent with current year comp weeks showing modest growth. CPG Non Durables continue to show year over year growth while CPG durables and fashion categories continue to show year over year decline.

Home Depot EDI 852 Reporting

November 13, 2009

If you are a Home Depot vendor you are eligible to receive product sales activity and inventory data via EDI 852 from Home Depot.

The Home Depot EDI 852 document will contain SKU/UPC level units sold, units on hand, and dollars sold for every store where your products are sold. The files are sent one time per week summarizing the prior week’s activity.

What can you do with EDI 852 from Home Depot?

· Analyze SKU/store level sales

· Analyze SKU/store level on hand

· Analyze average unit selling price by SKU/store

· Analyze plan-o-gram compliance by verifying on hand and selling at planned stores

· Identify out of stock stores, and even forecast demand based on prior sales

· Group stores into A, B, C categories based on SKU level sales volume.

Home Depot merchandisers expect vendors to receive and use EDI 852 data to analyze and manage their SKU activity. If you are not already using the data, of if you are not using as well as you could be then you are missing sales opportunities. Don’t wait for your merchandiser to call you and ask a question you can’t address – start working with the data today.

Learn more about what your organization can do with Home Depot EDI 852 click here

Retail Point of Sale Analysis How-To” Guides

November 13, 2009

Analyzing point of sale data can be a daunting task for an analyst, especially when there is very little real-world training available. That is why the Accelerated Analytics team has written four “how to” guides that share the secrets we use to analyze over 69,000,000 unit sales per week. Now you can get real-world insight available for download right to your desktop!

The retail data analysis “how to” guides provide category management and business analysts with a practical easy to follow approach for narrowing down large volumes of EDI 852 and retail point of sale data into manageable, actionable reports. Many vendors to Wal-Mart with Retail Link or vendors receiving EDI 852 are have a wealth of data available to them but analyzing the data on a weekly basis can be challenging. These guides provide insights the Accelerated Analytics team uses to turn the data into improved sales and in-stocks.

If you are a vendor to Home Depot, Wal-Mart, Lowe’s, or any other major retailer these guides can help you be more successful.

The series contains four “how to” guides with simple step-by-step processes for completing a

· SKU Analysis

· Store Analysis

· Out of Stock Analysis

· SKU Forecast

Learn more and buy your copy here:

http://www.acceleratedanalytics.com/analyst-training.html

Category Management / POS Training Guides

November 13, 2009

Analyzing point of sale data can be a daunting task for an analyst, especially when there is very little real-world training available.  That is why the Accelerated Analytics team has written four “how to” guides that share the secrets we use to analyze over 69,000,000 unit sales per week.   Now you can get real-world insight available for download right to your desktop!

The retail data analysis “how to” guides provide category management and business analysts with a practical easy to follow approach for narrowing down large volumes of EDI 852 and retail point of sale data into manageable, actionable reports.  Many vendors to Wal-Mart with Retail Link or vendors receiving EDI 852 are have a wealth of data available to them but analyzing the data on a weekly basis can be challenging.  These guides provide insights the Accelerated Analytics team uses to turn the data into improved sales and in-stocks. 

If you are a vendor to Home Depot,  Wal-Mart, Lowe’s, or any other major retailer these guides can help you be more successful.

 The series contains four “how to” guides with simple step-by-step processes for completing a

  • SKU Analysis
  • Store Analysis
  • Out of Stock Analysis 
  • SKU Forecast

Learn more and buy your copy here:

http://www.acceleratedanalytics.com/analyst-training.html

Vendor Managed Inventory (VMI): the Holiday Season

November 12, 2009

September 2 articles in the Wall Street Journal and the Chicago Tribute warn of potentially mild holiday buying driving inventory trends in major retailers across the country. The chief concern cited in both: fear of too much inventory when the season ends and the resulting “frantic price slashing” (Tribune) and “discounting bloodbath” (WSJ). The Journal article cites slow back-to-school shopping as a harbinger of slow holiday sales and the Tribune goes on to quote a supply chain management expert as characterizing many retail locations as “zombie stores” regarding their dropping inventories. “At best,” he says, “a store like that looks boring. At worst, it’s a struggle to get people to come in and buy product." This fear of clearance selling due to slow sales projections has retailers reducing the “breadth and depth of their assortments” going into the holiday season.

For retailers, this trend is actually helping their numbers, keeping investors happy. The Tribune reports that mainstream department stores and large discount chains actually improved their gross margin bottom line in the second quarter over last year (the notable exception being Macy’s). But this trend can be bad for retailers, and the Tribune correctly notes that fickle, unhappy shoppers will just as soon go to another store to get what they want than buy the next best thing on the shelf. Further, Perry Ellis CEO George Feldenkreis says, "Inventories have been very depleted at retail and retailers are going to find themselves in a situation where some of them, if sales just improve a little bit, are really going to be out of inventory and they are going to be chasing inventory."

What this means for vendors is that, among other things, it underscores the need for vendor managed inventory (VMI). Given the current retail inventory trends and the projected trends for the holiday season, it is absurd for any vendor to think that they will be able to sit passively and wait for an order to be placed by their retail partners. Rather, the vendor that supplies the most similar product to the need and can provide it most rapidly will be filling the voids this season, because the last thing that a retailer wants in this environment is to have an order need to be filled the next day and arrive three weeks later, too late to sell most of it, so that the lion’s share of the order ends up on a clearance rack.

So how does a vendor manage their inventory so that they can meet inventory needs at their retailers without too much cost for themselves? Rainmaker has identified four key indicators that should be tracked:

Out of Stock Stores

Stores with no items on the shelf cannot sell those items, and the longer they sit without sales, the less likely the retailer will be to re-order them in light of the industry trends. However, take care not to overstock those stores by checking the sales trends for the last several weeks that the store did have inventory and the same period sales the previous year. It stands to reason that sales will be down slightly over the previous year for most items, so reconcile that against the preceding several weeks and resolve stock outs immediately.

Under Stocked Stores

Current sales trends and same period sales the previous year combine to provide a valuable barometer for sales in the near future. Consider these and identify those stores with too little inventory to meet anticipated demand, and bring them back up to minimum required amounts of inventory to meet the short term demand, lest they end up in the out of stock category.

Warehouse and DC Inventories

Not all retailers distribute their products the same way, so knowing how the distribution of products works and considering the general or store-specific inventories sitting in warehouses and distribution centers for retailers will help prevent overstocking or overproducing products that may not be on a retail shelf but might well be on a warehouse shelf or already on their way to a retail outlet. Sum up item-level needs to resolve out of stock and under stocked stores to their associated warehouse or DC to prevent over-producing or over-shipping.

Gross Margin Return on Investment (GMROI)

MSRP is a fine concept, but more often than not, it isn’t a true gauge of what an item is selling for. Additionally, shipping items to one retailer or store has different associated costs than to ship to a different retailer or store. Calculating an average selling price for an item for each of retail partner and combining that with cost and inventory levels allows one to identify which retailers are generating the highest gross margin return on investment. Further, as retailers reduce their assortments, key in on the items with the highest GMROI and allow the others to fade out.

To track these indicators, it is essential that is be done at an item/store level if buyers are going to take the vendor seriously and relinquish any control over the ordering process. Managing inventory at this level can be difficult, especially for smaller vendors whose budget and resources are limited but whose retail partners are many. Simply receiving, storing, and analyzing the vast amount of information required to track these indicators often requires whole departments which are even then most often understaffed and overworked, degrading the quality of the answers they provide. The Rainmaker Group offers a comprehensive solution to these needs that culminates in a set of intuitive, business-user friendly reports that allow a vendor to begin analyzing data within hours of the arrival of data from a given retailer, rather than burning the lion’s share of time collating and formatting the information and only briefly analyzing it before it becomes stale. For a fraction of the cost of the overworked and understaffed department that attempts to handle these needs now, the Rainmaker Group’s Accelerated Analytics® solution can automate and improve this process dramatically. To see how Rainmaker can assist in the resolution of your stock out and under stock troubles, request a free stock out exposure analysis or contact us today!