The Globalization of Retail
By Nancy Chisholm, [email protected]
We operate in a global economy where businesses and consumers know no boundaries. Retailers are increasingly capitalizing on this opportunity to extend their brand beyond the web and existing stores, to set up shop in new markets around the globe, offering consumers the “in-store” experience to improve shopper loyalty. The successful execution of global store expansion today, however, requires that traditionally siloed retail store functions (inventory, security, traffic, etc.) operate in harmony to improve business performance and meet the demands of today’s savvy shopper. Meanwhile, global expansion also requires strict compliance with local regulations to ensure the highest level of efficiency, safety and security.
As the retail environment shifts, forward thinking retailers recognize that the strategic integration of key entities across the store — shoppers, inventory, store environment and associates — and around the globe, are paramount to long term success. By integrating these entities, retailers are armed with intelligent, real time information, equipped to make holistic, strategic decisions in the store, no matter where they are located. In addition, ensuring all local regulatory considerations are met will enable a seamless expansion process and contribute to a global retailer’s long-term success.
Why stores still matter
For shoppers, stores are an escape from their homes and offices into attractive, exciting spaces staffed by pleasant, well-informed people attentive to their needs and preferences. Stores let them browse and learn about multiple categories of merchandise, compare them by touch and smell as well as sight, assemble them into coordinated outfits or packages, and enjoy them immediately without delays or charges for shipping.
For retailers, stores are a way to engage shoppers face to face, building loyalty, trust, and revenue through expert personal service, up-selling and cross-selling. For all the doomsday predictions, stores remain as relevant today as they ever were. This underscores the value of new store global expansion as retailers look to increase visibility, build shopper loyalty and drive growth globally, but also puts pressure on retailers to make the right technology decisions at the onset to ensure a solid foundation is set to execute a seamless expansion process.
Compliance with local regulations
As retailers look to expand outside traditional markets, the rising complexity of regulations demand that store technology not only comply with local requirements, but seamlessly integrate with existing infrastructure to ensure all stores reflect the same look and feel customers are used to and mirror existing brand. Regardless of where a new store is planned, however, a retailer’s main focus should be on maintaining a consistent and relevant brand, and meeting the needs of their customers. Executives should not be bogged down by concerns about local requirements that may hinder the successful execution of global expansion. To alleviate these concerns, retailers are partnering with proven technology solution providers that deploy consistent technology, in a consistent manner and meet all local regulatory requirements, every time. This facilitates the efficient and accurate execution of new store development to ensure global expansion remains consistent with overall retailer brand. In addition, by collaborating with a technology provider that has the resources and commitment to ensuring all its products are safe for employees and shoppers, retailers can rest easy knowing local store openings will not be hindered by the lack of proper processes at the onset.
The integrated store is now
According to Bill McBeath of ChainLink Research, “Historically, each major retail store function has been managed in silos — security and loss prevention, labor/workforce management, inventory, promotions, and merchandising — each with its own separate systems, strategies, and personnel. That is starting to change. Loss prevention is being consolidated into other organizations. The management of promotions, labor, inventory, and merchandising is being integrated. We are moving towards the concept of the Integrated Store.”
As retailers look to expand, an integrated platform designed to support all the individual facets of a retail environment, is also critical to long-term success. An integrated store performance platform can help retailers address a number of objectives — optimize inventory, increase conversion rates, minimize shrink, drive employee productivity and/or enhance overall store performance — and arms retailers with unprecedented intelligence from around the world to make strategic business decisions. The unique ability to generate real time, operational reports, delivered directly to a retailer’s headquarters will further support successful global expansion by offering valuable intelligence at a moment’s notice.
With this intelligence, global expansion becomes a competitive advantage and not a potential risk as executives are better prepared to make smarter decisions to drive shopper loyalty and increase the bottom line. This benefit, in conjunction with a technology provider that can provide local intelligence to meet stringent regulations, will extend the value of the technology to a retailer’s overall expansion.
Conclusion
There are many factors to consider when it comes to global expansion but if done right, the benefits far outweigh the risks. To be successful and ensure all the moving parts are working in concert, retailers should consider the value of a technology solution provider that can offer on the ground support and intelligence within regions to ensure compliance with local regulations, as well as the innovative technology to support long-term growth and holistic decision making in the store. Combined, this offering will ensure long term global success.
Nancy Chisholm is VP and GM of Tyco Retail Solutions, a unit of Tyco International, is a leading global provider of integrated retail performance and security solutions, deployed today at more than 80% of the world’s top 200 retailers. Contact her at [email protected].