The holiday selling season is fast approaching. Best described as the busiest time of year, where a myriad of unpredictable variables come into play as retailers face some of their most difficult challenges. Said another way, “welcome to Q4”. Quarter 4 results often represent the difference between winning and losing, or whether an organization can deliver value to its shareholders – which means predicting the future is a necessary component of achieving the organization’s objectives.
That being said, 2022 is no ordinary year. The uncertainty of this year’s economy has retail leaders asking a very important question, “Will the upcoming holiday season be a shooting star or meteorite mayhem?”
Unfortunately, the current economy does not appear to bode well for the 2022 holiday shopping season. Retailers and consumers alike continue to feel the pain of supply chain delays, rising costs, labor shortages, and increased theft as the country looks to enter a [gasp] recession. Consumer spending has already slowed down as inflation reaches record highs. (Bedell, 2022) The Experts weigh in:
Ground Zero
With ports crowded, deliveries disrupted, and overseas manufacturing delayed, expect the current supply chain challenges to continue throughout the holiday season, or possibly worsen.
Product shortages are a big problem for retailers because the vast majority of shoppers are not inclined to stick around if they cannot get what they want right now. In the last three months, three out of five consumers have faced issues with out-of-stock products. Of those, just 13 percent waited for the item to come back in stock. In contrast, around 70 percent opted for a different brand or bought from a different retailer. Retailers might think they have built a loyal customer base, but it seems that does not count for much if they are struggling with out of stocks. (Kristensen, 2022)
Contributing Factors
The latest data from a study conducted by Salesforce reveals that consumers will begin holiday shopping much earlier than before, with over one-third (37%) planning on checking off their Christmas lists in early October. This is due to inflation increases and worrisome delivery delays. Many retailers have already reacted, in order to stay competitive, by advertising sales promotions earlier than last year.
The extra staffing needed for this expanded selling season are not just in stores. Warehouses and fulfillment centers will also require an increase of pickers, selectors, and shipping staff to accommodate the increase in business over a longer time span.
Unfortunately, the retail industry is still reeling from millions of its workers exiting the workforce, with what would eventually be dubbed as, “The Great Resignation”. Over a year later, many workers still have not re-entered the job market. According to the Bureau of Labor Statistics, there are still 11.5 million open positions at the end of summer 2022, but not enough candidates to fill them. (Retail Staffing, 2022)
Aggravating Factors
According to the 2022 Holiday Preview from market research data and technology company Numerator, The most widely celebrated holiday is Thanksgiving, with 97 percent of surveyed consumers planning to observe the 2022 Thanksgiving holiday. Other widely celebrated fall and winter holidays include Christmas (96%), New Year’s Eve (83%), and Halloween (78%), with 14 percent of respondents planning to celebrate Hanukkah. (Berthiaume, 2022)
The survey revealed that despite robust shopping plans, nearly nine out of ten consumers expect inflation to have an impact on their 2022 holiday spending and 83 percent of those surveyed anticipate it will be moderate or significant.
Aside from impacts on consumer behaviors, inflation creates a secondary market for stolen goods. As prices rise, consumers tend to substitute cheaper goods and services. But for individuals who were already buying the most inexpensive items, the secondary market in “stolen” goods may be the only place where price-sensitive consumers can find what they need at prices they can afford. (La Franchie, 2022) The increase in demand for cheaper goods incentivizes organized retail theft offenders to create supply.
Bracing for impact
If the last couple of years have taught us anything, it’s that the retail industry can seem out of our control. The trick is to focus on what you can control regardless of what challenges you may be facing.
As loss prevention leaders, we support the business in many ways. However, our support and influence over economic stability in the forms of inflation, supply chain and the weakening labor market may be considered out of our sphere of control. But are they?
Loss prevention leaders not only have a meaningful role in planning for a successful holiday season but also play a key role in curtailing the ripple effects of challenging economic conditions. It’s important to understand how, the challenges we can control, propagate and impact the business. Many of the conditions that cause costly out of stocks have a very important commonality. You guessed it – theft.
Pushout Theft is the technique of choice for Organized Retail Crime (ORC) rings and everyday thieves. Pushout theft allows thieves to clear out shelves, merchandisers, and display cases, walking out with a shopping cart filled with stolen merchandise. It is Gatekeeper System’s estimate that most pushout theft is never recorded, with multiple unnoticed smaller thefts for every major ORC pushout theft.
It’s no wonder shoplifting and retail losses are at an all-time high. Shoplifters are emboldened by the reduced risks of shoplifting, which has been exacerbated by the labor crisis. The “employee” which was a retailer’s first line of shoplifting defense, are nowhere to be seen, enabling full carts of unpaid merchandise to roll right out the front door.
By Removing carts from a shoplifter’s tool set, it puts the brakes on shelf clearing thefts and reduces out of stocks on high-demand products. This creates more on-shelf availability for paying customers. This all becomes possible with Gatekeeper Systems Purchek® solution, a cart-based pushout prevention system that thwarts shoplifters at the moment a theft occurs. As an offender attempts to leave, the Purchek® system locks the cart in place keeping the merchandise in the store, with most offenders walking away empty handed.
Now more than ever, retailers need a shoplifting prevention strategy that doesn’t primarily rely on store employees. Purchek® is a 24/7 solution that never takes a day off, it’s always on duty so the employees that do show up can focus on the customer experience needed for a successful 4th Quarter and beyond.
About Gatekeeper
Gatekeeper Systems’ expanded product suite of intelligent cart solutions offers solutions for EVERY retailer’s needs to minimize merchandise loss and reduce asset and labor expenditures.
Gatekeeper’s loss prevention, retail analytics, and cart containment solutions utilize patented locking wheel technology to put an end to cart-based shoplifting, shopping cart loss, and uninformed decision-making. Cart management solutions increase safety and reduce labor costs by maximizing productivity while simultaneously resulting in a positive store image.
Intelligent pushout theft prevention solutions stop thieves and their cart full of unpaid merchandise from leaving the store. Customizable wheel technology allows retailers to defend their entire store or just a high loss department based on the store’s unique layout.
NEW Retail Analytics solutions provide increased visibility for informed decision making. Increase efficiency, optimize fleet size, and perfect the entire customer shopping experience with store and enterprise-level analytics.
Find out why the top 20 retailers that use shopping carts rely on Gatekeeper solutions.
To learn more or to schedule a free consultation, click here.
References
Anonymous. (2022). Retail Staffing Trends to Watch This Holiday Season. People Ready. Link to Article
Bedell, C. (2022, June 29). 2022 holiday shopping: 3 ways retailers can brace for impact. The Future of Customer Engagement & Experience. Link to Article
Berthiaume, D. (2022, September 9). Survey: Despite inflation, holiday shopping intent looks strong. Chain Store Age.https://chainstoreage.com/survey-despite-inflation-holiday-shopping-intent-looks-strong
Kristensen, E. (2022, May 24). 19 Key Holiday Shopping Statistics you need to know in 2022. Drip.https://www.drip.com/blog/holiday-shopping-statistics La Franchie, J. (2022, March 17). The peculiar relationship between inflation and theft. LinkedIn.https://www.linkedin.com/pulse/peculiar-relationship-between-inflation-theft-firstsecuritynz/
