SUPPLY CHAIN

Retail container traffic to be up slightly in December

BY Staff Writer

Washington, D.C. — Import cargo volume at the nation’s major retail container ports should be up 0.3% in December compared with the same month last year as retailers head to the finish line of the holiday shopping season, according to the monthly Global Port Tracker report released by the National Retail Federation and Hackett Associates.

“The uptick we’re expecting for December isn’t large at all but it comes after several months where retailers had reduced their imports from last year, so it’s a positive sign by comparison,” NRF VP for supply chain and customs policy Jonathan Gold said. “Retailers are placing a cautious bet that consumer demand is increasing.”

The total for 2011 is forecast at 14.73 million TEU, down one-tenth of 1% from last year’s 14.75 million TEU.

Global Port Tracker counts only the number of cargo containers imported, not the value of their contents, so cargo volume does not directly correlate with retail sales.

Global Port Tracker, which is produced for NRF by the consulting firm Hackett Associates, covers the U.S. ports of Long Angeles/Long Beach, Oakland, Seattle and Tacoma on the West Coast; New York/New Jersey, Hampton Roads, Charleston and Savannah on the East Coast, and Houston on the Gulf Coast.

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OPERATIONS

Kenneth Cole selects Zmags for mobile, social and tablet commerce

BY Staff Writer

Boston — Zmags, a provider of rich media mobile and social merchandising, announced that Kenneth Cole has chosen Zmags CommercePro to create integrated web, mobile/tablet and Facebook-commerce brand experiences that drive product discovery and inspire purchase.

Kenneth Cole’s first commerce-enabled catalog launched in November, providing a dynamic and engaging experience to help its customers discover and buy the perfect gift.

“With Zmags, we have created tablet- and social-friendly content that makes browsing our lines more inspiring and buying the perfect gift much easier,” said Robert Genovese, VP media/ marketing, Kenneth Cole. “The Kenneth Cole customer is always seeking inspiration and new looks. And this holiday season, our investment in Zmags will entice customers shopping with us using their tablet or via our Facebook page.”

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OPERATIONS

Accenture report: Consumer electronics industry faces projected $17 billion product returns bill

BY Staff Writer

New York City — Customers returning electronics products will cost U.S. consumer electronics retailers and manufacturers nearly $17 billion this year, an increase of 21% since 2007, according to a new Accenture research report. These costs include receiving, assessing, repairing, reboxing, restocking and reselling returned products.

Only 13% of the retailers and 12% of the manufacturers surveyed indicated that return rates are trending downward, according to Accenture’s “A Returning Problem: Reducing the Quantity and Cost of Product Returns in Consumer Electronics.”

The research is based in part on a survey of executives from communications carriers, consumer electronics retailing and consumer electronics manufacturing companies, which revealed that product return rates over the past three to five years have increased for more than half of the retailers (57%) and nearly half (43%) of the manufacturers surveyed.

However, the Accenture research also revealed a significant opportunity for the industry to cut costs and reduce the level of product returns, given that only 5% of returns are related to actual product defects. While 27% reflect “buyer’s remorse,” 68% of returned products ultimately are characterized as “No Trouble Found.” This means that, despite the customer perceiving a fault, no problem was detected when the item was tested against specifications set by retailers or manufacturers, according to the report.

The report also concludes that solving this No Trouble Found problem – or even reducing it slightly – could have a significant impact on the cost of returns. Accenture has calculated that a 1% reduction in the number of No Trouble Found cases could translate to annual savings of 4% in return and repair costs, or $21 million for a typical large consumer electronics manufacturer and $16 million for the average consumer electronics retailer.

“These high consumer electronics return rates are unsustainable in a sector with brutal competition and thin margins,” said Mitch Cline, managing director of Accenture’s Electronics & High-Tech group. “Manufacturers and retailers should do more to differentiate their customer service by helping consumers understand, set up, use and optimize the products they purchase. Most companies invest considerable sums to manage returns, but need to refocus their strategies on proactively preventing returns through customer education and aftermarket support.”

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