Wishin’ and Hopin’ InsideOutdoor Oct. 2014
If you are of the age that you can claim one-time ownership of a transistor radio then you might just remember the song Wishin’ And Hopin’. I recently heard this tune while listening to the “oldies” station on my car radio. Ironically I had just finished speaking with a retailer who had used the exact same words as we discussed his merchandising strategy and year-end outlook. The coincidence really struck me.
Dusty Springfield’s catchy tune reached #6 on the pop charts in 1964. Though Wishin’ And Hopin’ (W&H going forward) is much better suited for a song title than a business strategy I still encounter many retailers who either fail to plan or who don’t effectively implement or execute their plan. These retailers end up with W&H results; sometimes it works out most of the time it doesn’t.
What is the W&H Strategy?
Let me lay out what I mean by the W&H strategy. The W&H retailer typically buys merchandise with no clear thought of how it might fit into the existing assortment. New arrivals are distributed among stores in a predetermined order and are seldom if ever transferred to balance the assortment. This ultimately leads to missed sales opportunities in some stores while potentially creating unnecessary margin problems in others.
- In-season markdowns are not addressed in a timely fashion and fill-in orders are hit and miss.
- Promotional merchandise is not sought out regularly which would help the store build volume and margin.
- The W&H retailer probably doesn’t have a solid marketing strategy either.
- Other typical traits might include not paying attention to freight costs current market rates on leases employee selling expenses and inventory shrinkage.
At RMSA we see this scenario all too often.
The W&H merchant enters each new season full of optimism yet is often left disappointed at season end. The retailer is unprepared to deal with day-to-day reality due to inadequate tools poor training lack of time or insufficient manpower. You can recognize this merchant by his “Ready Fire Aim” approach to most problems. This is management by crisis because the day is dominated by the urgent never leaving time for the important. In other words valuable time is spent putting out small fires while the big blaze continues to burn out of control.
Because of these and other problems the W&H store is left wishin’ for a different outcome than it experienced in the past. Wishin’ customers will like the selections he or she has made and hopin’ that the store will be profitable at year end. This really isn’t much different than playing the lottery. Most of the time you end up with the same results.
W&H is a reactive strategy not a proactive one.
A goal without a plan to achieve it is nothing more than a wish and “hope” is not a strategy at all. Many times this retailer ends up with little or no profit season after season and year after year barely staying afloat and not growing or improving. The vendors and the landlords are the ones making the most money in this case unfortunately… not you. In some cases you are simply buying yourself a job!
There is still time left this year
Preparation for Next Year
If the W&H strategy sounds all too familiar there are still things you can do now to prepare for next year.
- Make plans now to ensure that all old merchandise is discounted so that it will be gone by the end of December.
- See that seasonal classifications (i.e. winter footwear gloves hats etc.) have manageable stock levels going into season end.
- If you haven’t already take markdowns NOW on styles sizes and colors not performing as they should.
- If you have OTB to spend for opportunistic buys (i.e. Off-price) contact key vendors to see what might be available to freshen the presentation during the transition period between now and the arrival of spring goods.
- Review your spring on-order once again to make sure all bases are covered and that you are not overextended.
- If business is good pay off credit cards and attempt to reduce lines of credit.
- Review operating expenses and make adjustments if out of line with industry benchmarks.
- Review marketing strategies including email blasts and social media for effectiveness.
Make an effort on the items mentioned above and you won’t have to go through next year Wishin’ and Hopin’ for higher profits.
Ritchie Sayner
Summary of Wishin’ and Hopin’ InsideOutdoor Oct. 2014
The article discusses the pitfalls of the “Wishin’ and Hopin’” (W&H) strategy used by some retailers which involves inadequate planning and execution leading to missed opportunities and financial underperformance. It describes the W&H approach as reactive with retailers often unprepared to handle daily challenges resulting in a cycle of disappointment and stagnation. To counteract this the article suggests proactive measures such as timely markdowns strategic inventory management and effective marketing to improve profitability.
“A goal without a plan to achieve it is nothing more than a wish and ‘hope’ is not a strategy at all.”
Real-World Examples of the W&H Strategy
The Wishin’ and Hopin’ (W&H) strategy is often observed in various business contexts where lack of planning and reactive management lead to missed opportunities and financial struggles. Here are a few real-world examples:
- A small retail clothing store regularly purchases trendy items without analyzing past sales data or current market trends. This results in overstock of unsold items and frequent markdowns reducing profit margins.
- A local bookstore neglects to diversify its product offerings based on customer preferences and seasonal demands leading to missed sales opportunities during peak seasons like holidays or school openings.
- An independent café fails to implement a consistent marketing strategy relying solely on word-of-mouth. This results in fluctuating customer traffic and unpredictable revenue impacting its ability to cover fixed costs.
