Inventory levels just what I predicted

In early July WWD published a few articles stating that many retailers are cutting their inventory level and only buying what is necessary. July 7th, 2009 WWD posted this comment by Terry Lundgren. See first quote below. However, the industry seemed to forget what they promised, smaller inventories and merchandise closer to season. Haha. have you been into a store lately. There is no summer left and one is trying on cashmere sweaters, leather coats and wool boyfriend jackets (I still have mine in pristine condition form the 90')

It is 90 degreees here in New England and you can;t buy anything summer. I thought, well I hoped they would have learned. Apparently not. The second quote is what i published in a letter to WWD on the same day. Today, after receiving my WWD. they announced more stores are laying off, sales are down in some cases by over 30%. Surprised? Not at all.

Retail is not rocket science, although it is a science but mixed with art. And if they continue to force us in shoulder pads. Educationally they will get a D in science and an F in art.

"Many retailers seem resigned to the idea that the shipment faucet has been shut so firmly that they might even have to begin chasing merchandise. Terry Lundgren, chairman, president and ceo of Macy’s Inc., hinted at that possibility in an interview early this year.

“We will get our inventories down very tight,” he said. “We’ve all been scrambling to reduce orders. We will get to the point where we will be scrambling to increase orders. Inventories will be lean and that’s a good way to make money, a good way to raise margins and a good way to improve sell-throughs.”

It is amazing that it took retail stores so long to get to the position of having to realize that inventories are too high and mark downs are too steep. This was not the case in the late 70's when mdse actually did arrive just a few weeks prior to the season starting and not 4 months prior. What is happening in retail now is the result of one thing and one thing only. Greed. When stores were making a profit instead of putting that extra money in the bank they went ahead and opened more stores generally sharing the same demographic market. Without population increasing it was no surprise that same store sales started to decline. Therefore causing the trickling effect of what we see today in a grand scale. There is an easy answer to what companies are going through right now, and the key players have got to realize that a mistake was made and it needs to be fixed. If you want to stay alive in this business, follow these simple rules. 1. Stop being greedy, you do not need more stores, but better mdse in them 2. Hire, not for body's only, but associates that really want to be there 3. Train your sales staff, and yes this means follow through and finish the training, the heck with payroll hours, you'll make it up at the end 4. Decrease markdowns by not marking up so high in the first place. Imagine having the right mark-up and a customer actually buying something at full price within it's first few days on the sales floor. 5. Keep you store visually attractive. it only takes a minute for that young sales associate to come out from behind the desk and pick up something that is on the floor. A clean store means a better shopping experience for the customer 6. DMM's and GMM's control your checkbooks and your buyers. Sometimes less is better