The end of the 20th century is now in view. And, if the activity level of the year just past is much of an indicator, the year to come will be a dynamic time too, which would usher out the nineteen hundreds with a big flourish.
Among the safe bets for the coming year is that retail consolidation will continue, the number of retail channels selling food will increase and technology concerns will remain paramount.
But the question remains, what will these ongoing trends -- and others -- mean for the industry during 1999? In an effort to find out, SN polled several retail-industry leaders to see what they thought the New Year might hold. No one is clairvoyant, but let's take a quick look at what those polled think is upcoming. The full news article starts on Page 1. Take a look at the article for more on their remarks, plus their identities.
Consolidation: One effect of consolidation is to unsettle employees, one executive said. There's a lot of talk at companies, large and small, about whether the company is likely to be acquired, or if it would make an acquisition. The whole situation leads to high anxiety among all levels of employees as everyone looks toward an increasingly uncertain future.
This executive said the solution is to focus on winning the competitive battle at each store location, which makes what other companies are doing irrelevant and each economic unit of the company a winner.
Reorganization: Some retailers are not as profitable as they should be, others are unprofitable and yet others are bankrupt. In each case, executives of these companies plan to institute a reorganization of some sort to correct the situation during this year. That's clear enough, but reorganization will also sweep through companies that have acquired another, or which have been acquired. In those cases, executives will spend the year reorganizing in a bid to identify internal opportunities and synergies.
New boss: The balance of power is shifting again, another executive pointed out. In the 1970s manufacturers had the upper hand. A decade later the power shifted to retailers. Now, and for upcoming years, neither is the power center; consumers are. That means there must be a shift to figuring out how to meet consumer expectations.
New retailing: More than a decade has passed during which every channel of trade imaginable took a bite out of supermarkets' business by offering grocery products for sale. Executives predict that this could be the year during which supermarkets effectively fight back by looking into different forms of retailing themselves. That could include e-commerce, expanded nonfood programs and on-site gasoline stations.
It's interesting to notice that none of the executives polled mentioned anything about the prepared-meal challenge. A year ago, that was one of the central topics of any conversation about future retailing. It seems that by now, retailers capable of successfully offering meal items are doing so, and those that just don't have the capacity for it have moved on.