Report: Retailers will lose $50 per person in shrink this holiday season
The retail loss burden overall is expected to be $132 per person this year.
However, $50 of this loss — about twice as much as in other calendar quarters — is expected to be incurred in this holiday season, according to “The 2016 Retail Holiday Season Global Forecast” from Checkpoint Systems. The report provides an analytical view of business risks that major retailers face during this holiday season.
Strains on profitability manifest during the holiday season largely because of increased shrink and theft from internal sources — primarily via employee theft and other sales reducing activities (SRAs) — and external factors (primarily via shoplifting and organized retail crime). These loss increases place an enormous burden on retailers and, ultimately, on honest consumers who pay for it in higher prices.
“Despite more than one-third of the year’s retail sales expected to be registered in just these three months [of the holiday season], more than 40% of SRAs are also incurred in this same time period,” said Ernie Deyle, an independent retail loss prevention analyst. “This leads to increased shrink, and puts additional strains on brick-and-mortar retailers already reeling from an ongoing inhospitable retail market.”
As expected, inventory — including the space to store it — is the largest single cost of doing business, the report said. While reducing inventory means lower costs, insufficient inventory leads to out of stocks, lost sales and unhappy customers. So balancing these two factors is critical to profitability and growth, particularly in omnichannel environments.
As a result, more companies are aligning and using advanced data analytic tools, inventory management strategies, and sophisticated technologies, such as RFID, to gain the advanced visibility needed to track merchandise as it moves throughout the supply chain to distribution centers, retail backrooms and store shelves. This increases the overall value proposition specific to item, category and department financial contributions.
Austin named top town for real estate development
Texas is the go-to state for real estate developers in the U.S. and Canada, according to PwC and the Urban Land Institute.
In the 38th annual edition of the joint study, “Emerging Trends in Real Estate,” investment companies surveyed named Austin and Dallas/Fort Worth as the top two cities for development. The Northwest put in the second-best showing, with Portland and Seattle coming in at numbers three and four.
“Austin, along with many of this year’s top 10 cities, boasts attractive, niche neighborhoods and a vibrant, diverse economy,” said PwC Partner and research leader Mitch Roschelle.
One of the most dynamic trends in development, said the study, was “optionality”—people using the same space for different purposes at different times of day. It boils down to building communities, stated the report: “Instead of focusing on building “stand-alone” mixed-use buildings, they’re increasingly building mixed-use neighborhoods and communities that pack residential, retail, and commercial space into a dynamic whole.”
The investment professionals’ rankings for return on investment, were all over the board on retail development. Urban/high street properties were ranked as the third subsector overall, neighborhood centers received moderate rankings, and power centers and regional malls were at the bottom of their list.
Favored retail investment vehicles of the experts were mixed-use developments and niche power centers, along with grocery-anchored and lifestyle centers.
The complete top 10 list of trend-setting cities:
1. Austin, Texas
2. Dallas/Fort Worth, Texas
3. Portland, Ore.
5. Los Angeles,
6. Nashville, Tenn.
7. Raleigh/Durham, N.C.
8. Orange County, Calif.
9. Charlotte, N.C.
10. San Francisco
Ascena Group’s non-executive chair to retire
Elliot S. Jaffe, ascena retail group’s co-founder and non-executive chairman of the board of directors, announced his plan to retire.
Jaffe co-founded dressbarn in 1962 and served as CEO until 2002. He was ascena’s chairman of the board until January 2011, and then transitioned to non-executive chairman.
“EJ’s leadership has, from the start, provided the vision and passion to evolve from a single store with one banner to a family of brands,” said David Jaffe, president and CEO of ascena.