How Retail Weathers Summer
We cannot control the weather, but we can control our reaction to it by responding early and positively impacting our businesses. Fact is, in retail, the weather can have an all-compassing effect – influencing everything from what retailers have on the shelves, to impacting price, operations, marketing, sales and merchandising operations. In fact, savvy retailers know that the weather is a magical layer in the retail mix which serves, in some way, to predict how consumers feel.
Minor changes, big impact
It’s been proven that even minor changes in weather can have big impacts on retail sales. Cold spells can drive retailers into the store for extra layers, sun sees a search for shorter sleeve lengths and a real change in mind-set which sees consumers ditching layers. Therefore, it’s important that retailers are reactive to weather patterns and armed with weather information at key decision points. However, when it comes to fashion, the lead-times are far longer than the MET office’s insight and, so, retailers are often predicting weather predictions armed little more than last year’s sales.
No year is the same
The problem with predicting turnover based on last year’s sales, is that no two summers are the same in terms of weather (certainly not in the UK). Follow any retail reporting and you’ll find reports of exceptionally wet summers single-handedly contributing to the loss of sales. Instead, savvier retailers are taking seasonal data and opting to honour a percentage of it only with long-term production (anything from 50%-80%). This means building a collection that leaves room for a quick response channel that can be much more reactive to weather conditions.
Summer is one season to keep things closer to home! While there is a price advantage to sourcing 100% of apparel collections from Asia, the advantage to sourcing in Europe is that lead-times are reduced and the supply chain is much more reactive. Not only this, but couple it with the possibility to buy finished goods and you have a supply chain model that gets goods into store in a matter of days. While finished European goods will be derivative to less margin, failing to have goods in store when your consumer demands them will be conducive to no sales at all.
On the other hand, optimistic future summer planning coupled with bad weather will leave retailers with excess summer stock that makes its way into mark-down come sale time. While there isn’t a magic formula reducing mark-downs, some retailers play it safe with broad investment in basics which can be turned around to the next year. This includes colours which are generally neutral and shapes which are considered classical and don’t succumb to trend influences.
The fact is, the great British weather has varying effects on consumers’ lifestyles, the economy, and retail – the best we can do is remain reactive!
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