Q: Mr. Pruitt, it seems like a lifetime ago that business was more predictable. Now it’s a new situation weekly. How are you making sense of where the business is heading?
Steve Pruitt: This is a very good question. A friend and colleague of mine refers to this time as the “new abnormal”. We seem to get moving again, then there is another spike in COVID-19 cases, and fear holds us back. This trend will continue, but as I step back a pattern is developing. I was taught that 90 days makes a trend. So, let’s look at the last 90 days as the beginning of a new book of business.
The new book is made up of these elements:
1. Fewer customers, but more committed customers.
2. Less need for markdowns. As a result, more gross profit percent.
3. The lower inventory being produced is coming more in line with actual demand.
4. Necessity is giving us more control over receipt flows.
5. Fewer doors is eliminating promotional competition.
The more data we get, the clearer these trends will become. But I do believe that independent merchants will get through this battle. You can take control of your destiny by focusing on this new environment and looking for the positives to build upon.
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