Q: I am starting to see my sales drop off (after a long stretch of gains), and I know that inflation is causing a lot of concern, among even our wealthy customers.
Given that I made my Fall ’22 and Spring ’23 plans when things looked a bit brighter, how should I adjust my plans going forward given current market conditions?
A: This is a good question. As we look at our trend data, we are also seeing the beginning of a slowing trend. As we predicted, sales are starting to slow just as inventory is starting to build, which is not a good combination.
Our first step to address this situation has been slowing the sales plans for Spring ‘23. The only stores we are still planning up for next spring are stores in special destinations, mostly tourist hotspots. Still, we are watching the situation very closely.
If the slowing trend quickens, we will start rethinking our Holiday ’22 plans. Of course, this is being done on a store-by-store basis since each store and market are unique. Unfortunately, many of our stores have already bought merchandise for the fourth quarter so there are not a lot of changes that can be made at this point.
My advice is to remain cautious, but don’t make any drastic moves yet – as the old saying goes, “keep your powder dry.”
Fortunately, sales in general right now are still beating last year, but the percentages they are beating them by are shrinking.
Blacks is prepared for the next cycle. If you do not have a dynamic planning process in place, contact us now.