The retail - apparel, fashion & luxury (AF&L) - industry was already under pressure coming into 2020 as consumers changed their shopping habits and more sales shifted to – the less profitable - digital channels. Due to the COVID-19 pandemic, AF&L brands of all sizes are under even more pressure.
While total retail sales increased 7.5% in the month of June as stores reopened, private sector data, and the increase in cases in many states signals to slow-down in July and potential the months ahead.
Against this backdrop, retailers are grappling with questions that could determine their future:
How do we retain our best employees, many of whom have been furloughed?
What can we do to stay top of mind with customers, especially when they cannot visit our stores and may need to reduce their discretionary spend?
What about our vendors, who have seen orders canceled and may be facing insolvency challenges of their own?
What about the strategy around our store footprint and our landlords? How should we think about store profitability, and how many of our locations can we afford, or should, re-open?
How do we best allocate resources to address the accelerated shift towards e-commerce, and what does that mean from a day-to-day operating perspective?
How to we manage our creditors?
While some companies are not going to make it through the pandemic, at least not in their current form and under their current ownership, there are opportunities for many companies to turnaround their operations, stabilize their business and re-group as they get ready to perform in what will be a very different market environment.
Contact us to learn more about how we can support you as you navigate these complex and uncertain times.