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New Retail Playbook continued from page 110


differentiation. A top priority would be intense research into target consumers, something very few brands or retailers do on a consistent basis. Higher average selling


prices. Lower inventories and reduced markdowns are current- ly contributing to gross margin improvement, and lower sourc- ing costs could also play a role in improving that margin. SKU rationalization as a


means to profi tability. Wher- ever possible, minimize clutter in presentation. Inventory reduc- tion and allocation has been a prime focus in recent months.


Retail traffi c and sales declines will likely stabilize due to easier comparisons and slow improve- ment in economic activity. Focus on maximizing gross


profi t per square foot. Quality of sales is more important than quantity. Management needs to begin considering how to move back to a model that includes more full price selling through lower inventory, a better mix and balance. Sifting through the rub-


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ble, building a business at the top. Retailers and ven- dors need to develop a closer working relationship, as each looks to develop a more prof- itable business model. They must be willing to reach out and establish best practices in establishing a new partnership. Over time, entrepreneurial and visionary management has been replaced by executives with a primary focus on growth, and unfortunately, the needs of the consumer were forgotten in this transition. For a look at the com- plete report from the NRF, go to http://tinyurl.com/24gkjr6. ■


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