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Which way to go? Don't follow the Mart

By Jennifer Marks, editor-in-chief -- Home Textiles Today, 9/15/2003

No time for high-minded philosophical considerations in the merry madness of market planning?

Au contraire. This is precisely the time to be gazing deep into the future, if only because the future is coming on so very rapidly.

What we've been chewing on lately is a report called "Twenty Trends for 2010: Retailing in an Age of Uncertainty," sponsored by Intel and published by the Retail Forward consultancy.

Several of the study's 2010 trends are already well underway in the home textiles industry — retailers acting like suppliers, suppliers serving as private label product development houses for retailers. Still others are salient enough to deserve serious consideration — if not immediately, then once everyone has concluded the haggling over price points, mark-down money and co-op allocations.

1. Re-Concept Rather Than Remodel. The idea of a dominant specialty chain with hundreds of cookie-cutter boxes is out. The message: stop relocating units and start creating new formats. Companies that can manage the complexities of merchandising and supply chain management will operate bundles of smaller chains that address multiple market opportunities. Leading the charge here (aside from Wal-Mart) is Bed Bath & Beyond, with its acquisitions of Harmon Stores and The Christmas Tree Shops.

2. Malls Get Mauled. Malls of the future will need to establish a clear market position — the most promising among them, value, entertainment, upscale or lifestyle — with a mix of retail and non-retail formats targeting a particular customer segment.

3. Surviving the Supercenter. As traditional discount stores evaporate in the face of supercenters, savvy fashion retailers that target under-penetrated or emerging markets will step in to take their place. Consider Anna's Linens, which cleans up in urban and working class markets — especially classic Kmart areas — by offering well-merchandised fashion product.

4. Department Store Death Spiral. "Investments currently being made to fix the department store model — e.g. improving the shopping experience, creating a more compelling offer — may slow the decline, but will not reverse it."

5. Suppliers Become Retailers. To survive, suppliers will need to create more direct links to consumers — and in the process resolve conflicts about who owns the end customers, "and more importantly, who owns the market knowledge that every transaction with that customer generates." Only one supplier has moved aggressively on this front — Sure Fit, which is not only a supplier across nearly all retail channels, but a multi-channel retailer itself that is now diversifying into new product categories to serve both ends of its business.

6. Wal-Mart Keeps Smiling. 'Nuf said.

If 2010 seems awfully far away, consider that we were celebrating the arrival of the millennium only a moment ago. Consider as well that January 1, 2005, is now a mere 469 quota-protected days away.

Start your engines.

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