Chain retailers: Push on following Japan crises, serving community & making a difference

By Eric White, [email protected]

The seemingly unending disasters in Japan have impacted every aspect of life and business for the entire country. Facing enormous adversity, the Japanese people are finding themselves pushed to the limits of physical and emotional survival. The situation is demanding courage and response from every individual, business, community, and government agency.



Retailers in Japan fulfill a critical role in this time of crisis, offering desperately needed, even life-saving supplies. But many retailers are facing problems of their own, with stores completely wiped out, employees lost, and financial devastation inflicted on stores in coastal areas hit by the tsunami and in areas hurt the worst by the earthquake and aftershocks.



But even for retailers outside the immediate impact zone whose facilities were not destroyed, the pressures are great and the difficulties are significant. More than a business interest, these retailers have a higher calling to operate in this time of crisis, serving their employees, their communities, the nation of Japan, and the people who so desperately need basic supplies.



For stores that were completely physically devastated or handicapped, decisions and actions are in many ways easier than for those stores outside the impact zone that must continue operations, surrounded by crippled infrastructure, devastated supply chains, panicked customers, and other unexpected constraints such as power outages.



Here are some things that retailers in Japan can do and also things other retailers can learn and prepare for based on what we are seeing in Japan.



People come first. This is the golden rule following any disaster. People will first need to take care of their families and their own safety and health issues before being able to focus on their work commitments. Retailers should give those employees who have been impacted time and assistance to find missing family members, handle personal losses and address any needs at home. Large retailers may have the resources to offer counseling, assistance programs and other supportive resources to help their employees manage through the initial crisis. The physical and mental health of employees is critical and they will be able to perform better once they have settled all of their personal matters. Make it your business to provide them with a channel for reporting their own whereabouts and safety, as well as providing them with timely information about the situation and resources available to them.



Remerchandising the store. Basic supplies are critical now more than ever. Panic buying has swept supplies off of Tokyo shelves, where there has not been a tsunami and customers are not in dire need. This poses an enormous challenge to retailers who must strive to meet demand to get critical supplies to those who need them most. Whereas end-caps and promotion areas previously may have been stocked with luxury items, electronics, or other merchandise, now the store must be completely re-merchandised to make it as easy as possible for customers to get the basics: canned foods, bottled water, baby formula, dried foods, etc. Store set-up should allow customers to easily access these needed supplies. This may mean putting bottled water in the middle of the store or even setting up a tent outside the store to manage and accommodate higher traffic.



Exhibit flexibility in operations. In times of crisis, nothing can be assumed. Lack of infrastructure, unexpected obstacles and discontinuation of services leave retailers operating under uncertain conditions at best. Following Hurricane Katrina in the United States, the government issued vouchers to victims to enable them to buy needed supplies. Retailers had to process these cards by hand. Depending on available infrastructure, these may be electronic transactions, more akin to debit cards than paper vouchers. Regardless, retailers must be prepared to act with flexibility and competence when it comes to modifying operations to accommodate the needs of the situation. What’s the best way to do this? Provide training for employees, exhibit competence and decisiveness in leadership, empower decentralized decision-making during times of crisis and elicit creativity for overcoming adversity.



Handle it like a special event. In many ways, post-disaster operation becomes an exercise in handling a special event. Emotions are high, there will be unusually high traffic and other unexpected conditions, forcing retailers to treat everyday operations for the following days and even weeks, as a special event. Even amidst conditions that are not ideal, retailers can put security measures in place to help ensure the safety of employees and customers. In some cases, retailers may only allow a certain number of customers inside the store, enable them to shop and exit before letting another group in. Other times, they may set up a supply tent outside the store, filling it with the most critical items like bottled water and food, and diverting the majority of the crowd toward that temporary kiosk. At times like these, retailers must focus on the business of managing queues, managing people, and handling large volumes of transactions.



In short, in crises, retailers need to go beyond the ordinary: something they are really good at that differentiates their response from that of government agencies and other entities. Retailers are resourceful, innovative, and quick to act and they pull from every possible source. For example, The Wall Street Journal reported that Walmart executives in Japan deployed innovative ways to bring in cargo planes full of supplies and found a way to source petroleum needed for transportation where there was none by their sheer will and creativity. Their ability to problem-solve and bring every resource and idea to the table to reach extraordinary goals, is nothing short of inspiring. This is a time to recognize that retail – especially chains with locations represented throughout the globe – really matters and their performance in times of crisis can mean the difference between life and death.



Eric White leads the retail strategy practice at Wren, providers of physical security solutions used by some of the world’s most innovative and respected retailers. White has 20 years of experience in loss prevention, asset protection and physical security, having served at Walmart and The Home Depot. He can be reached at [email protected]. To learn more about Wren’s solutions, visit wrensolutions.com.