The ripple effect of rain checks
Being out of stock on featured items is one of the things consumers consistently rank high on any list of aggravating retail business practices—and for good reason. It is very annoying from the customer’s perspective to see an item promoted and to make a trip to a store for the featured item only to find it is sold out.
However, out-of-stocks are an inevitability in a highly promotional selling environment, which means retailers have to find ways to minimize customer annoyance. For Target, that means posting small pads of rain checks next to out-of-stock products and also offering instant substitutions for featured items. Neither is ideal from the perspective of the customer or Target. Rain checks are typically more trouble than they are worth, because they tend to escalate customer aggravation, create operational challenges and give rise to further problems down the road.
Target’s policy requires customer to retain the rain check and bring it with them on a return visit to the store that must occur within 45 days of the issuance of the rain check. This places a burden on the customer, who is forced to compensate for the retailer’s inaccurate demand forecast or a supply chain deficiency that failed to replenish the store in a timely manner. Either way, the potential for escalation occurs if, upon the return visit, the item is again out of stock.
One solution is to offer instant substitution with a comparable item. However, in cases where the small pads of rain checks are posted next to the out-of-stock item, it is incumbent on the customer to locate an associate to determine if a substitute is available. To counter this problem, Target offers instant substitute coupons that enable customers to substitute a comparable item. For example, when a store was out of stock on a 50-count package of one-quarter Target brand resealable storage bags, it offered the Ziploc brand product at the same price. This is a win for customers, but not a good deal for Target, since it was forced to sell a product at a lower price than intended.
Retail Industry Cut 91,300 Jobs in Nov.
New York City The U.S. retail industry cut 91,300 jobs in November, marking the biggest employee-loss in 34 years.
November marked the 12th consecutive month of retail job reductions and was well-above the industry’s average monthly pace of 40,000.
Overall, the nation’s employers cut 533,000 jobs in November, pushing the unemployment rate to a 15-year high of 6.7%.
Multidev Technologies Announces New Store-Budgeting Functionality
Montreal-based Multidev Technologies Inc., principal provider of fully integrated business solutions for the retail industry, announced this week that it has released their new Store Budgeting functionality which is fully integrated within its leading retail-management solution, ChainDrive, offering its clients and perspective customers an added feature to its already robust system.
ChainDrive’s Store Budgeting features provide retailers the possibility to set sales objectives, view comparables and establish Key Performance Indicator (KPI) targets. This budgeting tool provides a platform that has the ability to set and monitor store objectives using real-time data as well as accumulates historical statistics allowing for immediate action for improved and meaningful results.
The Store Budgeting tool does much more than simply set sales targets; it allows the head office to control what data is visible to the store and produces the view that best represents its requirements for goal setting, reporting and analysis. It also provides the capability to manage stores by district, area or type and ranks them against any set target.
“We always strive to develop and enhance ChainDrive and recognize the importance of offering a solution that evolves and advances with the needs of the retailer in mind,” stated Mark Carter, executive VP of Multidev Technologies. With the addition of our new Store Budgeting functionality, our retail customers will truly benefit from a tool that clearly communicates their budget goals and objectives directly to the store level.”