MIAMI—Retailers continue to design, promote and sell more of their own private label merchandise, according to a new study from new Retail System Research study titled “Getting it Right the First Time: Designing and Delivering Merchandise that Sells.” They noted the recession provided an opportunity for retailers to highlight the private label value message to consumers while holding steady or even improving their selling gross margin.
This year’s survey respondents reported a 22 percent increase jump in retailers rating collaboration as a top opportunity from 2008, regardless of the retailer’s size. Scorecarding suppliers was perceived as only slightly more important now than in the 2008 study, and developing long-term relationships with trustes suppliers actually showed a slight dip. In both cases, less than one-half of retailers view them as good opportunities. And having an audit regimen in place is important only to about one-third of respondents.
RSR found “legacy technology” is often cited as a top organizational inhibitor preventing retailers from moving forward on a variety of issues. “Existing Technology” has jumped to the forefront of inhibitors that prevent execution of a go-forward private label strategy- garnering an eye-popping 75 percent from “Retail Winners” (those who manage private label effectively). But retailers haven’t necessarily “given up” on their existing technology portfolios. It’s clear that Winners, having identified the existing technology as the top inhibitor to progress, want to fix, rather than replace, the component pieces of the technology solution. To that end, “improved technology integration tools” are really important to them, according to the new study. The analysis showed retailers plan to continue evolving along the path they have already established.
RSR believes retailers recommended the following steps to retailers: collaborate, but measure; begin scorecarding suppliers as often as possible; develop and deploy quality and compliance regimens; establish long-term relationships with partners that have proven that they can do the job, and work the “virtuous cycle” of supplier relationship management – enabled by a cohesive, integrated technology portfolio.