By Gordon Hecht, Serta Simmons Bedding
Whether you browse the headlines of Weekly World News or cast a glance at the National Enquirer at the supermarket checkout, you may have seen these outlets touting bold revelations for 2020. I would rather cast my fortune on rolling boxcars three times in a row at The Golden Nugget during January’s Furniture Market, but you can be sure that millions of readers will live by the information in those tabloids.
In the spirit of making predictions, here is my forecast for our retail industry for 2020. I encourage you to put a copy of this article in a safe place and check it during the 2021 Rose Bowl Parade to see how many I get right!
Government forces take over your business. My crystal ball reveals that your business will be affected by some local, state or national law that goes into effect four hours after the conclusion of the Orange Bowl. It may be mattress recycling, a sales tax increase, minimum wage changes or signage restrictions. At least one out of four retailers will not be ready for the new regs and some may pay costly penalties. You still have time to research any upcoming ordinances and avoid legal headaches! Check with your CPA, attorney or even your local congressperson or city council.
Your region will have weather! It may be buckets of rain in the South, feet of snow in the North or more darned sunny skies in the West. Your shopping traffic will be slowed or even halted at least one day this month. The result will be near-zero sales. Even your local TV news can’t tell you what the weather will be, so don’t expect me to tell you either. Just plan for the worst today and be ready to roll with the hottest offer ever to melt away the Winter Sales Blues. You’ll have to make up for lost time soon after the next “Weather-geddon,”so get the ads and merchandise ready!
Big changes in personnel this month. I’ll stand by this prediction without reserve: Your top salesperson will leave, or your bottom salesperson will stay! Either way, early spring will find you traveling along that famous creek without the necessary oars. Stay or leave, your sales production and morale will be affected. Some wise business leaders will find themselves prepared with a drawer full of resumes from qualified candidates, while others will lose $30,000-$50,000 in sales a month.
I know what happened – it didn’t come in. April is the cruelest month for shipments, as shoppers are flush with tax refund dollars and want immediate gratification, causing delays if your inventory is low. Create your plan for the out-of-stock slowdowns by setting up a reward system for shoppers who are disappointed, perhaps $200-$500 in store credit if you’re unable to meet your shoppers’ demands. You will create customer goodwill from a predictably bad situation.
I foresee a big parade at the end of the month, maybe even two. One will be for our brave men and women who made the ultimate sacrifice for our country, and the other will be for your sales and delivery team for planning a successful, record-breaking event. My two-parade prediction is not all inclusive, and some retailers will be left out. How many parades do you want in your town?
The Internet won’t shut down. We are now in the second decade of the millennia and almost halfway through the year, and there are still some retailers that don’t believe in the power of the Internet. I predict that less people will get a daily newspaper this year than last, and more people will cut the cable cord. This is not the year to spend half your advertising dollars on digital marketing, but it is the year to make sure that digital gets the largest share of your budget. More than run of press, more than TV, more than inserts and circulars.
Twenty strong store managers will declare their independence from fear! Store managers live with fear – the angst that their trusted office manager or data entry clerk will quit, and no one will understand the POS process. (For clarification, POS means Point of Sale!) However, I boldly predict that 20 or more store managers will demand that they are trained and understand all office functions and are able to survive without the office help that holds them hostage. End fear in your store this month. And if you are the store owner or factory owner, learn those functions yourself.
They are either coming in or going out. By Month 8, one of your local competitors will give up and burn out with one of those whizbang, wall-to-wall selloffs. Or, one of those national behemoth chains will pick your burg for expansion. Both can disrupt your business and steal market share from you. But you don’t have to be the next store with garish yellow and black posters in your windows. Assuming the NBA playoffs are over by now (they seem to last forever), you will have heard that “the best defense is a good offense” at least four score times. So go on offense and give 110 percent!
Week #2 sales will be lower than Week #1. It seems to happen every year. Labor Day sales reach new records and then things slowly fizzle. Check your 2019 September numbers and I’ll wager that you did 60 percent of the month’s business from the first to the 10th. Lots of people wait for Labor Day to shop, but unless your closing rate is 97.5 percent, your sales team still left a few buyers out there. You can capture more sales, just move off the “Extended by popular demand” theme.
You won’t be able to buy time, as in radio and TV time. In case you haven’t heard, there is some sort of a presidential election in 2020 and whoever the candidates are, their ad spend will look like a nuclear arms race on steroids. Your loyal TV and radio stations will drop you like a third-party candidate so they can reap the rich rates that the Dems and GOP pay. Less people are reading the paper, and local candidates are jamming the Postal Service with junk mail. Pick your advertising source and invest heavily. Vote “No” on sales slowdowns!
Fifty-one percent of the country will be happy with the election results. OK, 49 percent will hate it and fight it. But after an election we tend to see spirits rise, along with the stock market and overall expectations for well-being. I predict that 51 percent of vendors and retailers will take advantage of the good feelings and promote heavily. Forty-nine percent will grumble, and half of those will not see 2022!
Try as we might, we have not convinced the public that a new mattress has a place under that decorated tree. They prefer instead to waste their money on TVs, clothes and jewelry. You won’t make it with coat racks and silent butlers (does anyone still make those?). I predict that some retailers will promote themes like “Give the Gift of Better Sleep,” or hold community service events like donating free pillows and blankets to the needy for every mattress purchased. Our buying public will surely understand that the value of good sleep cannot be measured in mere dollars, and that they should invest heavily in their family’s well-being by buying new mattresses for everyone in the house. It will foster a feeling of mutual trust and partnership between shoppers and retailers that will last throughout the New Year.
On second thought, I’m taking that last prediction back!
Gordon Hecht is Senior Regional Manager/Strategic Retail Group at Serta Simmons Bedding. You can write him at email@example.com.