RETAILERS TO FOCUS ON CUSTOMERS, NOT COST
By Adnews Staff
Canadian retailers plan to focus on revenue growth rather than cost reduction in order to grow their business over the next three years, according to a study done by IBM Canada of Markham, Ont. and the Retail Council of Canada. Retailers plan to open between 900 and 1,800 new stores over the next three years. Personalized service is the top customer service strategy for 69% of the respondents, while 53% plan to use loyalty programs. Just over half of the retailers plan to follow a regular promotional pricing strategy. To complement this, 36% plan to use a vendor relationship strategy of co-op pricing and promotion. Small retailers plan to stay small and focus on personalized customer service. Seventy per cent do not plan to expand their operations and 64% plan to stick to their current in-store service offerings. Mid-size retailers plan to build relationships with their customers and to invest in supply chain management. Just over 70% have a customer database and 62% use it for target marketing purposes. Top supply chain strategies are merchandise planning and computer-modeled store inventory. Fifty-one per cent plan to do co-op advertising with their vendors. Large retailers plan to restructure for growth and add new services and channels. They want to open between 500 and 800 new stores and close up to 300 stores. Twenty-two per cent plan to add credit services, while 19% plan to add in-store banking and 14% will provide travel services. Sixty-seven per cent want to add the Internet as their primary non-store channel. The Retail Council of Canada is a non-profit, member-funded industry association with over 7,500 members including national department store chains, national and regional discount chains, mid-sized specialty stores and independent merchants. It was established in 1963.