Most of you know how much l love playing guitar and listening to music. So, it’s hardly a surprise that I kick off so many of my columns with a passing reference to some song or a band that seems to be in the same key as where my column is headed.
With that on the table and an eye on current headlines, you hopefully won’t blame me for queuing up this oldie but goodie from R.E.M. — “It’s the end of the world as we know it, and I feel fine.”
In the spirit of transparency, I think the song fits the bill, but I am not so sure I feel fine.
Anyone who looked at last week’s headlines might very well feel like the world is spinning out of control. A well-established bedding maker filed Chapter 11, a bunch of domestic upholstery makers are slashing jobs faster than seasoned upholstery makers can cut fabric, and big-box powerhouses are so bloated with inventory that they are thinking about paying, yes, paying customers to keep unwanted purchases rather than returning them.
And all of that is before we even talk about out-of-control inflation, $5 a gallon gas, diminished consumer demand, and growing concerns that another recession may be just around the corner.
So, it is not unreasonable to see why Chicken Little’s feathers are ruffled as our fowl friend looks towards the heavens muttering that we’re all probably clucked.
Goldman Sachs, which had previously warned of the possibility of a recession, last week updated that warning, suggesting the odds of a recession are now twice as likely as it previously suggested.
And while I am the first to admit that the folks are Goldman Sachs are light-years ahead of me when it comes to topics like recessions, I am going to humbly submit that I don’t believe anyone knows for sure what’s around the corner for us economically.
What I do know is that recessions have a way of underscoring economic stability, or the lack of, be it for a company or a country. They also define and, in some cases, accelerate emerging trends that are birthed during a recession.
Look back at the recession of 2008. We saw brick-and-mortar sales gobbled up by e-tailers, subsequent changing consumer buying patterns and demands, and a flurry of new retail platforms that were eager to cater to those changing and emerging patterns.
So, looking back as a means of getting a handle on what may be ahead, I think my call is for the following:
Suppliers and retailers who had flawed platforms, procedures, and processes will see them magnified and probably worsened. And, for that matter, so will their competitors — we are entering a take-no-prisoner playing field.
As business remains soft, at least for the near term, consumers will be in charge, and expectations, especially for convenience, will rule the day.
Shoppers are going to wait for retailers to blink first, especially as they realize how anxious most stores are to right their out-of-balance inventory situations.
So, am I suggesting retail is dying or dead? Absolutely not. But I am absolutely suggesting to you that orthodox retail, for lack of a better term, is morphing into something new and different.
The good news is that consumers still — and will always — sit, sleep, relax, and entertain. All of this bodes well for all of us in the home furnishings arena.
However, what’s changing is where and how they shop for what we sell, how they interact with us, and what their expectations from us are.
If you plan to stay in the game, you should already be well on your way to having a strategy that meets and exceeds your customer’s expectations.
If you do, you will be fine. If you don’t, it just may be the end of the world as you know it.