Santa’s New Helpers: Robots, Receipts & Retail Revolutions
This week’s news rundown digs into several stories likely keeping you up at night – and a few might raise your eyebrows. We’re talking about major shake-ups in the department store world (Macy’s is closing how many stores?), the tricky tightrope walk of sustainability in fashion supply chains, and some surprising shifts in holiday shopping behaviors. We’ll also touch on why that annual shrinkage report you’ve relied on for years is no more and debate whether those humanoid warehouse robots are the future or an expensive PR stunt. So settle in, and let’s unpack what these developments mean for your business and the industry.
Department Stores’ Last Stand? Major Players Overhaul Operations
Department stores can’t catch a break. The once-mighty retail giants face another challenging year, prompting dramatic moves from almost every big name. Macy’s plans to close 150 stores, Nordstrom is spending $3.8 billion to go private, and J.C. Penney is putting $1 billion into overhauling everything from merchandise to supply chains.
Traditional Department Stores Shrink While Off-Price Retail Expands
The numbers paint a grim picture in big-box retail. Macy’s will shrink from 479 to just 329 full-line stores within three years, and Nordstrom has already closed 23 locations, leaving only 93 flagship stores standing. Yet off-price retailers tell a different story — TJX plans 1,300 new stores, pushing its total footprint past 5,100 locations. Ross Stores eyes an ambitious 3,600-store goal, while Burlington steadily adds 100 new spots yearly.
Holiday Season Offers Glimmer of Hope Despite Long-Term Challenges
Department stores might find some temporary relief during the upcoming holiday rush. Nearly 60% of consumers named them a top shopping destination — up 10 points from 2023. Mall traffic continues driving 75% of department store visits and shows signs of life. However, younger shoppers increasingly favor discounters, with millennials and Gen Z spending four points more year-over-year on value apparel. The pressure forces each retailer to forge its own path: HBC (parent company of Saks Fifth Avenue) snaps up rival Neiman Marcus, Kohl’s tightens budgets, while family-controlled Dillard’s sticks to subtle merchandising tweaks.
Balancing Sustainability Goals & Worker Welfare in Fashion Supply Chains
Fashion’s eco-makeover is underway, but at what cost to its workers? As brands race to slash their carbon footprints, the industry faces a critical challenge: Cleaning up its act without leaving factory floor staff in the dust.
Order Chaos: The Hidden Toll of Unpredictable Demand
Fashion brands are undermining their own sustainability goals through poor demand planning. Research across 19 companies reveals that erratic ordering patterns are creating a ripple effect throughout the supply chain, making environmental targets impossible to achieve. While brands rate suppliers on both environmental metrics and delivery speed, their unpredictable demand forces suppliers to maintain wasteful excess capacity and resources. The data shows a clear solution: fashion’s supply chain decarbonization can only succeed when brands commit to consistent, long-term ordering patterns that allow suppliers to optimize for both efficiency and sustainability.
Power Play: Bringing Factory Voices into the Boardroom
Sustainability initiatives for fashion brands also often falter due to a critical communication gap with their suppliers. When manufacturers lack clarity on the rationale behind targets, the decision-makers involved, and the practical pathway to achievement, they’re forced to interpret requirements in isolation. Without a platform to voice insights or contribute to strategic discussions, suppliers – who possess invaluable frontline expertise – remain disconnected from the very sustainability conversations that directly impact their operations and require their successful implementation.
NRF Halts Annual Shrink Report After 30+ Years: Retail’s Loss Tracking Enters New Era
For over thirty years, retailers relied on the National Retail Federation’s annual shrink report to gauge inventory losses. Now, that familiar benchmark is disappearing, a momentous turning point in how the industry measures and responds to theft, errors and other causes of inventory shrinkage.
Evolving Challenges Outpace Traditional Metrics
Retail has changed dramatically since the NRF first started tracking shrink in the early 1990s. Mary McGinty, the NRF’s VP of communications, explained that a “broad study about retail shrink is no longer sufficient for capturing the key challenges and needs of the industry.” Instead of the usual report, the NRF plans to release new research later this year specifically examining retail theft and violence — issues that have gained increasing attention from both retailers and lawmakers.
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Data Dilemmas & the Quest for Accuracy
While the NRF’s shrink surveys provided valuable insights, they weren’t without controversy. Brand Elverston, a veteran of retail asset protection, pointed out limitations in the data’s accuracy, calling it “impossible” for retailers to have accurate shrink data because of its ambiguity. The challenge of pinpointing the exact causes of inventory loss – whether from external theft, employee theft or process errors – has long been a sticking point. With 63% of lost inventory attributed to internal causes in the most recent report, the retail industry faces pressure to improve its data collection and analysis to address these issues more effectively.
Deloitte: Holiday Shoppers Embrace Experiences & Hunt for Deals in 2024
The 2024 holiday season promises a mix of optimism and caution as shoppers open their wallets wider while looking for bargains. Deloitte’s latest holiday retail survey reveals fascinating details.
Spending Surges, with Experiences Taking Center Stage
Holiday budgets are set to grow by 8% this year, with the average shopper planning to spend $1,778. But the real story lies in where that money’s going. Spending on experiences — think festive events and quality time with loved ones — could jump by 16% — a telling figure reflecting a broader 18-month trend of consumers valuing memorable moments over material goods.
Bargain Hunters Gear Up for an Early Start
Despite the willingness to spend more, holiday shoppers aren’t throwing caution to the wind: 75% plan to participate in October and November promotional events, up from 61% last year. With five fewer shopping days on the calendar, these early deals could be paramount for retailers and budget-conscious consumers. Shoppers across all income brackets are showing their frugal side, with 62% considering more affordable brands and 48% thinking about switching to cheaper retailers.??
Humanoid Robots: A Flashy Distraction from Real Warehouse Innovation??
Picture a warehouse full of robots that look just like you and me. Sure, it’s a captivating image, but not everyone’s buying into the hype. Exotec, an established warehouse automation player, calls out humanoid robots as nothing but a publicity stunt that brings zero value.?
The Inefficiency of Imitation
Exotec’s CEO, Romain Moulin, doesn’t hold back when he likens humanoid robots to designing “planes to flap their wings.” Sure, it’s an attention-grabbing concept, but it’s far from the most efficient solution. Warehouses thrive on specialized machines tackling specific tasks. Trying to cram all those functions into a single humanoid package is like forcing a Swiss Army knife to do the job of an entire toolbox. Moulin argues that this approach is “simply poor optimization” in an industry where every second and cent counts.
The Real Face of Warehouse Innovation
While Tesla’s Elon Musk inspires excitement about humanoid robots hitting warehouses by 2025, Exotec sees it as a fleeting trend. Remember the drone last mile delivery craze? Moulin predicts a similar fate for these androids. Instead of chasing human-like machines, the true innovators are developing targeted, non-humanoid systems that do the job without unnecessary frills. These practical solutions might not grab headlines, but they’re the real workhorses transforming the industry from the inside.
OneRail: Simplifying Last Mile Delivery in the Face of Chaos
With department stores downsizing, consumer habits evolving and supply chains under pressure, your final mile delivery needs a partner who’s been in the trenches. Many last mile delivery companies exist. Still, there’s only one OneRail, a seasoned expert who both understands these challenges and solves them day after day:??
No matter your industry, OneRail can transform your last mile logistics strategy. Schedule a demo today to find out how.
First seen on the OneRail blog at https://www.onerail.com/santas-new-helpers-robots-receipts-retail-revolutions/