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1、END OF YEAR REPORTLOOKING AHEADTO THE CHALLENGES OF 2023A WORLD RETAIL CONGRESS PUBLICATIONINTRODUCTION:THE BIGGEST PRIORITIES FOR 2023The year began with fresh waves of Covids latest variant,Omicron,which brought with it more restrictions,closures and cancellations across all walks of life,retail i
2、ncluded.But at the same time,there was seen to be light at the end of the tunnel as vaccine programmes gathered pace and the severity of the infection began to wane.Lockdowns were also easing gradually and we all dared to think about the“post-pandemic”world.It was to be the core focus of the World R
3、etail Congress which was finally able to meet in person in April,in Rome.It was the first physical meeting of the Congress in three years,which was important in itself but was deemed even more so just because it allowed the industry to finally meet.However,if we have learned nothing else from the tu
4、multuous and unprecedented events of the last three years,it should be that we can never rule out another twist or turn.And so it proved with the invasion of Ukraine on February 24th.At the World Retail Congress in Rome,Dr Ira Kalish,the chief global economist for Deloitte summed up the economic and
5、 geopolitical picture brilliantly as ever.In his keynote presentation he said that:“If you had asked me three months ago about the outlook,I would have said that things are going a lot better.But war in Ukraine has changed all that”.He added that the conflict has thrown“a massive monkey wrench”into
6、what had been a gradually improving global economic picture.It set the tone for the discussions across this years World Retail Congress-that retail was suddenly going to have to learn how to live with inflation rates never seen for over 30 years coupled with an energy crisis,growing supply chain bot
7、tlenecks,recruitment challenges and consumers facing real pressures on household budgets.At the same time,all of the structural changes retailers were learning to live with as a result of the pandemic were continuing to play out.Taken together,it has meant that the challenges facing any retail CEO a
8、nd executive team are more severe than at any time in generations.Which is why we wanted to use this special End of Year World Retail Congress report to ask our international roster of retail leaders and industry expert correspondents to highlight the three biggest business priorities that they are
9、focused on for 2023.2|End of the year reportWhat is striking across all of the contributions in this report are the similarities of issues and priorities right around the world and across all retail sectors.One of the most common words used throughout is“uncertainty”and that looks set to remain true
10、 through into 2023.The report highlights all of the key business challenges but also the mounting imperative to focus on delivering sustainability targets,to think about the people in their businesses and how to find ways of serving increasingly hard-pressed consumers.Retailing does not and cannot s
11、tand still and what is clear from this report is the way that retailers are identifying the problems but are at the same time looking to find and implement solutions.Finding growth when growth is hard to find is always challenging but it also creates the environment that encourages ingenuity and inn
12、ovation.The content of this special report reinforces the theme and focus for the 2023 World Retail Congress which will meet in Barcelona on April 25-27th.Our theme is“Retail leadership for extraordinary times”and will bring together four key pillars we are calling“resilient retail”-to show how reta
13、il can meet todays economic challenges,“purposeful retail”-underlining the importance of having a strong purpose and focus on ESG strategies,“transformational retail”-to show how we now operate in a truly omnichannel world and all that brings with it and finally“customer focused retail”.The consumer
14、 is now truly in charge and retailers have to respond to their demands to show how,where,when and with whom they want.The open,honest contributions from senior executives from across the global retail industry in this report show in clear terms how retailers are facing up to these challenges.We hope
15、 that you find this collection of views and experiences valuable to your thinking and analysis as you look ahead to a new year.IAN.MCGARRIGLEWORLDRETAILCONGRESS.COMIAN MCGARRIGLE CHAIRMAN WORLD RETAIL CONGRESSINTRODUCTION3|End of the year report4|End of the year report5|End of the year reportMEET TH
16、E EXPERTSIn this end of the year edition,we have gathered insights from 21 leading global retailers and experts to understand how,and crucially,what,the industry is prioritising in order to survive the current economic climate.Over the course of this issue,you will glean learnings from:DEBORAH WEINS
17、WIG FOUNDER AND CEO CORESIGHT RESEARCHHELEN DICKINSON CEO BRITISH RETAIL CONSORTIUMBERNIE BROOKES AM OWNER AND EXECUTIVE CHAIRCOLETTE BY COLETTE HAYMAN PATRON|JOE BERRY RETAIL AWARDCHAIR|THE CEO INSTITUTE SYNDICATEMUWAFFAQ M JAMAL MANAGING DIRECTOR|SUDASIA CONSULTINGFORMER BOARD OF DIRECTORS MEMBER
18、AND CEOABDULLAH AL-OTHAIM MARKETS COMPANY AND PANDA RETAIL COMPANYMATTHEW SHAY PRESIDENT AND CEO NATIONAL RETAIL FEDERATIONBS NAGESH CHAIRMANSHOPPER STOPFOUNDERTRUST FOR RETAILERS AND RETAIL ASSOCIATES OF INDIA(TRRAIN)ASHLEY MICKLEWRIGHTCEO BLUEBELL GROUPJAN BARTELS SVP B2B ZALANDOSUZIE WOKABI FOUND
19、ER SUZIE BEAUTY AND SB DADAJULIET ANAMMAH CHAIRWOMAN AND GROUP CHIEF SUSTAINABILITY OFFICER JUMIA NIGERIATOLGA NC HEAD OF RETAIL IKEA RETAIL(INGKA GROUP)MARK W.BAUM CHIEF COLLABORATION&COMMERCIAL OFFICER FMISELVANE MOHANDAS MANAGING DIRECTOR INTERNATIONAL ASSOCIATION OF DEPARTMENT STORESDJ FORZA MAN
20、AGER RACE TO ZERO CAMPAIGN FOR RETAIL,HOSTED BY WORLD BUSINESS COUNCIL FOR SUSTAINABLE DEVELOPMENTMATT CLARK EMEA RETAIL LEAD ALIXPARTNERSDAVID BASSUK GLOBAL RETAIL CO-LEAD ALIXPARTNERSTHOMAS HARMS GLOBAL RETAIL LEADER EYCHRISTEL DELBERGHE DIRECTOR GENERAL EUROCOMMERCEEVAN SHEEHAN GLOBAL INDUSTRY RE
21、TAIL LEADER DELOITTE GLOBALKATIE WEIR GLOBAL CONSUMER OPERATIONS LEADER DELOITTE GLOBALGUILLAUME PROU PRESIDENT,EMEAHAVAIANAS6|End of the year reportINDUSTRY EXPERTSMEET OUR7|End of the year reportINDUSTRY EXPERTSFOCUSING ON THE CONSUMER2023 will be another rocky year of large-scale disruption for r
22、etailers.As they face into a recession,they must see their business through the eyes of the consumer.Discretionary spend and brand loyalty will be at an all-time low,and me-centric consumers will focus their purchase considerations on cost more than ever.Retailers must take honest stock of what they
23、 have,what differentiates them from the competition,and what their customer values the most.By focusing on strengthening and effectively communicating their value proposition,retailers can stand out from the crowd and remain top of mind.Margins will be squeezed by discounting intended to shore up cu
24、stomer demand and clear inventory.Rising costs driven by product inflation,energy prices,labour rates,and a contraction in marketing effectiveness are all additional pressures that will impact the bottom line.A self-disrupting mindset is required,through the creative destruction of the old ways of d
25、oing things.Retailers need to think through all costs and ask why,and then why again.This exercise will be painful,but there is simply no way around it.Rethink every single practice,policy,procedure,and person from the lens of having to pay for your transformation journey.We anticipate digital growt
26、h to decelerate,which opens up huge opportunity.Retailers have focused funding on digital growth without fully considering profit,and will finally make the shift to omniprofit.87%of consumers engage in digital throughout their instore/online purchase journey,and the industry needs to shift its think
27、ing to digital first by reorienting people,process,tools,and KPIs to truly unlock profit in the face of disruption.The winners will be those who are agile and innovative in their approach,surfing the waves of disruption,while others will be knocked down by the force of the industry,consumer,and the
28、operational changes required to survive and thrive.MATT CLARK EMEA RETAIL LEADALIXPARTNERSDAVID BASSUK GLOBAL RETAIL CO-LEADALIXPARTNERS8|End of the year reportINDUSTRY EXPERTSA WIN WIN IN UNCERTAIN TIMESAs 2022 draws to a close,its easy to be worried just looking at the headlines about inflation an
29、d cost increases.Pair that with ever increasing demand from customers for sustainable goods and it can feel like the squeeze is on.However,Deloittes Global Retail Practices sees an exciting trend with Deloitte clients who are using efficiency enablers like AI and machine learning to cut costs and ca
30、rbon.We believe 2023 can be the year of the win-win if you know where to look.In the short term,global economic worries are impacting global behavior.In the US and the UK,the share of wallet consumers plan to allocate toward more discretionary categories has been slipping since September 2021.1 At D
31、eloitte,we are studying how sustainability preferences are impacting spending intent.Even as inflation bares down,sustainability is still a desire from the wealthiest and youngest consumers.2 We expect this double pressure of rising costs and expectations to persist into 2023 for most retailers.But
32、all is not lost,we are seeing incredible trends in AI and machine learning in retail.Innovation is enabling measurable improvements in sustainability and margins.This win-win is fueled by technologies that can enable new resource efficiencies.We have seen fashion retailers stripping cost and carbon
33、from supply chains with geospatial data in raw material sourcing.AI is decreasing emissions with telematics for fleet efficiency and successfully reducing shrink,as well as smog,with real-time demand forecasting.Cutting carbon and cutting costs is what 2023 will be about.One trend we can get behind
34、in the new year?Younger shoppers and those with the deepest pockets are increasingly willing to pay premiums for sustainable goods.3 Now thats a win-win.1.Shape of consumer spending|Deloitte Insights2.The cost of sustainable products|Deloitte Insights3.The cost of sustainable products|Deloitte Insig
35、htsDeloitte refers to one or more of Deloitte Touche Tohmatsu Limited(“DTTL”),its global network of member firms,and the irrelated entities(collectively,the“Deloitte organization”).DTTL(also referred to as“Deloitte Global”)and each of its member firms and related entities are legally separate and in
36、dependent entities,which cannot obligate or bind each other in respect of third parties.DTTL and each DTTL member firm and related entity is liable only for its own acts and omissions,and not those of each other.DTTL does not provide services to clients.Please see to learn more.KATIE WEIR GLOBAL CON
37、SUMER OPERATIONS LEADERDELOITTE GLOBAL EVAN SHEEHAN GLOBAL INDUSTRY RETAIL LEADERDELOITTE GLOBAL 9|End of the year reportINDUSTRY EXPERTSOPPORTUNITIES IN CHALLENGING TIMESAs 2022 draws to a close,consumers continue to face rising costs,geopolitical uncertainty,and mounting debt.The holiday shopping
38、season,which usually promises so much for retailers,has been muted by increasing austerity and thrift among hard-hit shoppers.Unfortunately,these challenges look set to continue in 2023 and retailers will be balancing them against shoring up their supply chains and delivering on their sustainability
39、 commitments.But arguably the biggest priority for retailers will be about staying in business how to generate revenue and get costs under control without sacrificing their value proposition.As an optimist,I see opportunities in challenging times.As consumers increasingly focus on their basic needs,
40、so must retailers.Their main priority will be to look at whats happening to their top line.How can they increase shopper engagement,continue to build loyalty,and explore additional revenue models?Customer-centricity will be more important than ever and by supporting their customers through difficult
41、 times,retailers will see the increased shopper engagement and loyalty they need.Many grocery retailers have already applied voluntary price freezes to essential items,pushed back on price increases from brands,and increased the appeal of private label brands,and theyre seeing positive increases in
42、market share as a result.When managing costs retailers need to keep their customers front-of-mind,by focusing on retaining those elements of the shopping experience that add value to their shoppers and removing those that dont.Reducing staff may seem like an obvious solution to managing cost,but its
43、 one that will almost certainly have a negative impact on the customer experience.The last few years have shown us how resilient and adaptive we are.Its this resilience and willingness to adapt and listen that will help retailers and consumers appreciate and understand what it takes to find the solu
44、tions and opportunities we all need.THOMAS HARMS GLOBAL RETAIL LEADEREY10|End of the year reportMARKET REPORTS11|End of the year reportMARKET REPORTS:AUSTRALIATHE BIG 3 DOWN UNDERBERNIE BROOKES AM OWNER AND EXECUTIVE CHAIR COLETTE BY COLETTE HAYMANPATRON|JOE BERRY AWARD;CHAIR|CEO INSTITUTE SYNDICATE
45、Australian retail veteran,Bernie Brookes,and owner and Executive Chair of Colette by Colette Hayman highlights the three biggest challenges he sees facing retailers in Australia in 2023Retain and attract quality staff.With an over reliance on workers with Visas and a low unemployment rate,retailers
46、are going to face increasing difficulties in finding staff.Rising costs of freight,electricity,gas,postage,and the anticipated wage pressures will make cost control difficult and consumer affordability of many discretionary items hard.Satisfying the ever-increasing consumer focus on sustainability.1
47、TALENT2VALUE3SUSTAINABILITY12|End of the year reportMARKET REPORTS:ASIAWATCHING AND WAITINGASHLEY MICKLEWRIGHT CEO|BLUEBELL GROUP Ashley Micklewright,CEO of the Bluebell Group,the luxury brand retailer which operates throughout Asia including China,highlights the biggest three priorities for 2023.Ne
48、ed to keep an eye on the strength of the US dollar and some Asian currency weaknesses,as well as inflationary pressures from Europe,of which we still have not seen an impact yet in Asia.Need to keep monitoring when they will start travelling again,and in what numbers,to determine how individual bran
49、d strategies will evolve,especially with regards to the fast expanding daigou cross border shopping trend where individuals or syndicates buy outside of China for importing back into China for customers particularly in luxury goods.Need to keep assessing the impact on domestic demand in each Asian m
50、arket as travel and local restrictions loosen.1MACRO2MAINLAND CHINESE TRAVELLERS3COMING OUT OF COVID13|End of the year reportMARKET REPORTS:EMEAPUTTING THE FOCUS WHERE IT MATTERS GUILLAUME PROU PRESIDENT,EMEA|HAVAIANAS Rethinking the purpose of Direct-to-Consumer within a multichannel strategyDTC wi
51、ll continue to play a very important role for Havaianas to build the brand image;yet,the current trend is one of soaring costs,especially for online trading.Among key factors:logistic costs,performance marketing,gross margin degradation due to price war triggered by other e-tailers.We will need to r
52、eset the priorities of the channel brand image focus while maintaining a good level of profitability.From a store opening point of view,we will prioritize regions where higher growth is expected:Middle East/Africa/Southern Europe Revenue management in a highinflationary environment Costs are increas
53、ing at double-digit rates in some lines of P&L,especially cost of goods;there is a need for re-establishing gross margin through price increases without losing market share.We will reduce promotional intensity,and work on high gross margin categories-essentially the core lines of the business.We wil
54、l play to the max one of the brand strengths:an affordable price point for a branded footwear that can set us apart from competition as the anti-crisis open-toe footwear.Among the top projects to streamline the cost structure of DTC,we have implemented a new logistic hub,going from 2 to 4 warehouses
55、 servicing Europe,to get closer,faster and cheaper to our final consumers and stores.Very focused marketing investments The strategy will be kept very flexible during the short sell out season(16 to 20 weeks),accelerating investment where productivity proves to be the best.Seizing the best retail me
56、dia opportunity and concentrating the investment in a few selected markets will be of essence.We want to continue increasing our investment in brand marketing,no matter how hard the times will be,as we still need to build awareness around the brand and new categories in many European markets.13214|E
57、nd of the year reportMARKET REPORTS:EUROPECHRISTEL DELBERGHE DIRECTOR GENERAL EUROCOMMERCEGETTING RETAILS VOICE HEARD BY POLICYMAKERSOur major priority currently is to ensure policymakers understand the impact of high inflation and high energy prices on our sector.Our sector faces a triple squeeze d
58、riven by energy and commodity prices,constant demand from large manufacturers for price increases while consumers cut back their purchasing in the face of a real cost-of-living crisis.This calls the existence of some companies,particularly small businesses,into question.We see a worrying trend of na
59、tional governments equating high turnover with high profits and being tempted to impose ill-conceived taxes on excess profits or seeking to address inflation by imposing retail price caps with no reference to the actual cost of sourcing these products.These challenges come at a time when our sector
60、continues to face a major transformation in digitalisation,sustainability and skills.Our recent joint study with McKinsey shows that up to 2030 retail and wholesale will need to invest over 600 billion in these three areas or an additional investment of up to 1.6%of company turnover;and this at a ti
61、me when margins are being squeezed by high inflation.We will need to highlight the essential service we provide both to consumers and many industrial ecosystems,and that we will need help in both the short term on energy and in the longer term with the investments we need to keep competitive.Due to
62、our specific role in the supply chain,supporting our sectors transformation can be a powerful means to help the EU achieve its own digital,sustainability and resilience objectives.Finally,the cost and practicability of regulation remains a top priority:we still face a veritable tsunami of EU regulat
63、ion,particularly on due diligence,sustainability and the circular economy,with a risk of drawing resources on compliance rather than investment.Next year we will be celebrating 30 years of the EUs single market,and this is a great opportunity to remind ourselves of the important role it plays in the
64、 competitiveness of our sector.All of this underlines the need for all of us,at the European and national level,to get across to decision-makers the importance of our sector to society,the threat to its essential role by ill-conceived regulation but also that supporting our sectors current fundament
65、al transformation is an opportunity for Europe,its economy and society.EuroCommerce 3 key priorities for 202315|End of the year reportMARKET REPORTS:GERMANYBUILDING THE CUSTOMER EXPERIENCEZalando is one of Europes leading online platforms for fashion and lifestyle.We are progressing with our strateg
66、y to be the Starting Point for Fashion by deepening customer relationships and strengthening our relationships with partners to drive the growth of our platform business model.In 2023,we will continue to carefully navigate through these turbulent times,pushing forward with our strategic initiatives,
67、mainly focussing on further elevating the customer experience,continuing to work on our ambitious sustainability goals and taking our B2B services to the next level.Personally,I am thrilled to further elevate our B2B offer.Already today,we make our logistics know-how and infrastructure available to
68、around 800 of our partners,so they can concentrate fully on their core competencies in the fashion business.As a next step,we want to offer our partners multi-channel fulfillment.This means that we will provide them with our infrastructure and capabilities not only for orders received via Zalando,bu
69、t also via other platforms and the partners own online shops.In this way,we not only help them overcome the complexities and challenges arising from running cross-border E-Commerce but also increase the efficiency of the fashion industry which is currently suffering from inventory and supply chain i
70、nefficiencies.JAN BARTELS SVP B2B|ZALANDO16|End of the year reportMARKET REPORTS:INDIACHALLENGES OF GROWTHIndia is one of the fastest growing countries in the world.Indias growth is dependent on consumption and retail controls that last mile of consumption,which underlines the importance of Indian r
71、etail and the Indian consumer.With these important facts in mind,the three priorities for all retailers will be:1.Build resources for growth.Financial capital storefronts and digital assets.2.Hire and acquire talent at the head office level,which is in big shortage in the country given that modern r
72、etail in India is still only two decades old.3.Navigate the digital strategy and serve the Indian consumer through omnichannel retailing.Specific challenges for Electronics retail:Supply chain and China manufacturing.Specific for food and grocery:Competition from the big retailers and online players
73、 who are pouring money to capture a share of the US$450 billion food industry.Specific to fashion and Lifestyle Sector:Customers are polarising towards luxury or value and therefore to get the right positioning and serve the customer will continue to be a challenge.The big opportunity for the premiu
74、m lifestyle and fashion retailer is the tier 2/3/4 markets that are growing at a fast,high double digit rate.All other sectors in retail like jewellery,ethnic wear,homewear:1.The huge shift from unorganised retailing to organised retailing that is being pushed by Government policies as well as chang
75、es in consumer expectation.2.Increase in wages and therefore shortage of skilled manpower.3.Services industry like restaurant,hospitality,medical,tourism and aviation is drawing entry level candidates and retail is feeling the pressure.BS NAGESH CHAIR|SHOPPERS STOPFOUNDER|TRUST FOR RETAILERS AND RET
76、AIL ASSOCIATES OF INDIA(TRRAIN)17|End of the year reportMARKET REPORTS:KENYAA NEW BRAND LAUNCH FOR A NEW YEARMy top 3 priorities for 20231.To launch and establish my second beauty brand.Having successfully created(2009),launched(2012)and sold(2016)Kenyas first beauty brand,SuzieBeauty,I have spent 2
77、022 creating my second brand,SB Dada.SB Dada will be an introduction into beauty tech in the African market.Our target audience is millennials and GenZ,which is important because the mean age on the continent is 19.7years old.The brand will be trend and tech forward,with a“fast beauty”approach in ma
78、rketing and sales.Our brand pillars are sustainability,relevance,uniqueness,and inclusion.The landscape and industry players are completely different this time around,so its almost unchartered territory,again!A very exciting space to play in.2.Living in the digital revolution is a privilege.Introduc
79、ing beauty tech/digital transformation into my local(African)industry sprinkled with the currently unprioritized concept of sustainability is really important to me and my business.3.To more thoroughly understand the obstacles placed on start-up businesses and brands,demystify the myths,and do what
80、I can to smooth the road for those following in my wake.SUZIE WOKABI FOUNDER|SUZIE BEAUTY AND SB DADA18|End of the year reportMARKET REPORTS:NIGERIAEMERGING MARKET CONSUMERS BATTEN DOWN THE HATCHESJULIET ANAMMAH CHAIRWOMAN AND GROUP CHIEF SUSTAINABILITY OFFICER|JUMIA NIGERIA1.All eyes on ChinaHow Ch
81、ina responds to the unrests and decisions it takes either to abandon its zero covid policy or continue will have significant implications on supply chains and inflation.Industries that have de-linked their supply chain from China and have robust demand outside its shores will experience minimal impa
82、ct.2.Two Consumer behaviour trends that will shape business priorities Revenge spending As inflation shrinks household budgets consumers are reordering core and discretionary items and some products are surprisingly benefitting more than others.In general consumers have deprioritized discretionary i
83、tems such as durable goods and automobiles and are bargain shopping on core staples such as food.However,after two years of COVID restrictions,they are spending more(or at least not reducing their spending)on leisure activities,entertainment,alcoholic beverages and personal grooming.These are produc
84、ts that are either typically considered discretionary(leisure activities,and entertainment for example)or at the bottom of the core basket of goods(alcoholic beverages for example).However,spending on these products affords consumers an opportunity to be contrarian,to reassert control over their liv
85、es and yes exact a revenge on the macro environment which had made them powerless for so long.Possibly if inflation persists into the new year,this contrarian behavior will revert to the norm.Companies in the industries benefitting from this today will do well to recognize that this is short-lived a
86、nd plan accordingly.Defending the core basket To fund spending on leisure activities and entertainment as highlighted above,consumers in emerging markets are aggressively battening down the hatches on the cost of their core staples budget.They spend time discovering the lowest prices among retail ou
87、tlets for different food categories thus creating specialties within their core basket and once this is clear they do not switch.For example,while shopping for detergents and cleaning supplies,they may switch brands in store to gain small discount price advantages but will hardly switch stores.Retai
88、lers thus need to understand where they are considered category leaders and invest in deepening that advantage.3.Sustainability Coming soon to a theatre near youGiven the stark realities of how far we are from achieving the Paris agreement by 2030,there will be increased regulatory focus on environm
89、ental sustainability.Companies will need to simultaneously develop strategies for adapting their business models to the effects of a warmer and more unpredictable climate as well as reducing their impact on the environment.It will be a tough juggle but for companies that have not already started to
90、look at climate related risk to their business model,it will be even harder to adjust.19|End of the year reportMARKET REPORTS:SAUDI ARABIAEMBEDDING GROWTH2022 witnessed an outstanding comeback for retail in Saudi Arabia.Double digit growth rates,north of 20%,were achieved by most retailers in grocer
91、y food as well as fashion.This took place despite the fact that 2021 had already seen a strong recovery in growth following the worst of the pandemic period.The best performing retail sector was food services where Saudi witnessed unprecedented growth rates.That was driven by the change of customer
92、habits fueled by the authorities efforts to grow the entertainment sector.With the turmoil of war in Ukraine putting the global supply lines under pressure to the whole world and specifically to the Middle East,those challenges are easing going through the last quarter of 2022.But retailers are stil
93、l looking to manage stock levels to meet demand.At the same time,oil prices continue to sustain record high levels which is still putting pressure on retail prices.All imports into Saudi Arabia are already seeing an average 15%price increase for shipments arriving in 2023.Retailers are meeting the c
94、hallenge of high prices by continuing to push promotional activities and that will prevail throughout 2023.Being innovative in driving retail sales is going to be a material challenge for retailers to achieve growth in 2023.The last challenge for Saudi retailers in 2023 is being close to the disrupt
95、ive shopping habits of customers.The pandemic period was only the beginning,and it has become an everyday matter where retailers cannot afford to let their eyes off this ball.Being close to customers and adapting to the ever-changing habits will for sure be a major task during 2023.MUWAFFAQ M JAMAL
96、MANAGING DIRECTOR|SUDASIA CONSULTINGFORMER BOARD OF DIRECTORS MEMBER AND CEOABDULLAH AL-OTHAIM MARKETS COMPANY AND PANDA RETAIL COMPANY20|End of the year reportMARKET REPORTS:SWEDEN|IKEASUPPORTING THE MANY TOLGA NC HEAD OF RETAIL IKEA RETAIL(INGKA GROUP)Affordability and energy saving The IKEA visio
97、n is to create a better everyday life for the many,and it is more relevant than ever,as we face rising cost of living and increased inflation.People continue to spend much of their time at home and the need for a safe space is essential.In this new reality,we want to ensure that IKEA offers home fur
98、nishing solutions that meet peoples needs.Staying as affordable as possible for the many is our absolute priority this has never been as important as it is now when we see the increasing cost of living.While IKEA is unfortunately not immune to inflation and increased prices of raw material and energ
99、y,we have invested heavily in keeping our prices as low as possible.We will continue exploring opportunities to make our offer even more affordable and decrease prices when and where possible.We are also stepping up our efforts to support people in energy saving and circularity,in addition to our ow
100、n investments and contributions to renewable energy as a company,continuing on our long-term commitments.We are committed to doing our part to limit global temperature rise to 1.5C by becoming net-zero latest 2050,and halving greenhouse gas emissions in absolute terms from the total IKEA value chain
101、 by 2030.Right now and going forward,we are increasing our efforts to inspire and guide our customers by highlighting products and sharing tips to save energy,reduce waste,and give their furniture a longer life.We also offer affordable financial solutions to allow people to create big or small chang
102、es to their homes.1My top 3 priorities for 202321|End of the year reportMARKET REPORTS:SWEDEN|IKEA Customer centric omnichannel retailingWe continue to innovate and change to meet new customer needs.At IKEA,we have found new ways to meet our customers where they live,often integrating into existing
103、neighbourhoods,with smaller stores and through new,unique formats such as IKEA planning studios.We have also developed new,relevant fulfilment strategies,with a strong focus on more sustainable solutions.For home deliveries,the goal is to have 100%last mile zero emissions by 2025.We are creating a s
104、eamless customer experience to be there for our customers whenever and wherever they want to meet IKEA,and we are bringing our products and services closer to our customers with new touchpoints and formats.Physical IKEA stores remain an essential part of our business model and one of our biggest str
105、engths.Sustainable and humanistic employerWe want our customers to know that when they shop with us,they are playing their part in building a fairer,greener and healthier future without having to compromise on the experience.Equality,diversity and inclusion are an essential part of the IKEA culture,
106、and we believe refugee integration is good for both business and society.Refugee employment,as part of our wider equality agenda,brings talent,skills,diversity and different perspectives into our company and the communities where we operate.It is important to have the emergency support in place-from
107、 IKEA and others-but our partners have told us whats needed is allies that are there for the long run,and this is what we have committed to as a company.We have three main aims with our approach-to improve the perception amongst our co-workers,customers,and societies around us related to refugee int
108、egration,to inspire the private sector to engage in refugee employment and to engage and share knowledge with decision makers and opinion leaders to drive a positive change in public policy around the lives of refugees.2322|End of the year reportMARKET REPORTS:UKHOW TO COMPETE FOR CONSUMER SPENDTheU
109、K economy has been buffeted by soaring inflation,political instability,and a weak pound.Households have faced inflation rates not seen in over forty years,as the war in Ukraine drove up food and energy prices.Rising costs and falling sales volumes have also meant an increasingly challenging year for
110、 retailers.As competition for the limited consumer spend heats up,retailers will need to focus on three key priorities:HELEN DICKINSON OBE CEOBRITISH RETAIL CONSORTIUMThe cost of living is rising,and real incomes continue to fall because of high inflation.Customers are more cautious in their spendin
111、g,looking for the best value for money in their purchases.Even higher income households are trading down to cheaper brands,while many value-brands have seen a huge jump in demand.Retailers must respond to this backdrop by continuing to put the needs of their customers first and ensuring everything t
112、hey do represents excellent value for money.And those selling more discretionary products will need to work twice as hard to show the value and importance of their products to their customers.Understandably retailers are looking for more ways to cut operational costs,as they work hard to protect cus
113、tomers from price rises.But they must not be tempted to cut their sustainability efforts.Putting sustainability at the heart of business operations is not a marketing ploy.It is not virtue signalling.It is not a nice-to-have.It is a vital part of the solution.From reducing packaging to green fleets,
114、and from solar panels to cutting waste we need to see more essential actions that will not only help tackle climate change but will also help to reduce energy use and cut future costs.The world of retailing is transforming fast,and the challenges are big and often new.Navigating such an uncertain wo
115、rld requires agility,ruthless flexibility and being prepared to fail.Not all leaders are equipped with the skills they need and resource is stretched and often in short supply.Therefore,the need to retain and develop home grown talent has never been greater.And the need for all people to feel valued
116、,recognised,and happy in an inclusive and diverse workplace a pre-requisite for future success.123VALUESUSTAINABILITYTALENT23|End of the year reportMARKET REPORTS:USASUPPORTING RETAILERS FOR THE YEAR AHEADMATTHEW SHAY PRESIDENT AND CEO NATIONAL RETAIL FEDERATIONAs we approach the end of 2022,holiday
117、 shopping is in full swing.Consumer demand is stronger than expected,with in-store shopping showing particular strength.Consumers cherish the tradition of in-store holiday shopping with friends and loved ones,and they have missed these memorable experiences the past several years due to COVID-19 res
118、trictions.While spending continues to grow,consumers and businesses also face persistent inflation and economic uncertainty.NRF will remain focused on key policy priorities to ensure the retail industry is best positioned for success in the year ahead.Reducing inflation:Though inflation has moderate
119、d slightly from all-time highs,core inflation remains at elevated levels,even as the Federal Reserve raises interest rates to cool off the economy.While the Federal Reserve can focus on long-term economic policy,Congress and the administration can take steps to provide American consumers with relief
120、 from higher costs.These immediate steps include repealing the failed Section 301 Tariffs,addressing the ongoing labor shortage by passing comprehensive immigration reform,and further easing supply chain pressures by investing in supply chain resiliency.Fighting organized retail crime:Organized reta
121、il crime has become a significant issue plaguing retailers of all sizes.ORC is a primary driver of retail“shrink,”which reached$94.5 billion in 2021 up from$90.8 billion in 2020,according to NRFs latest National Retail Security Survey with an average 26.5%increase in ORC incidents over the previous
122、year.To bring this problem under control,NRF strongly supports curbing the online sale of stolen goods by passing the INFORM Consumers Act and increasing federal coordination to fight crime by passing the Combatting Organized Retail Crime Act.NRF looks forward to advocating on behalf of the retail i
123、ndustry in 2023 to ensure retailers large and small have the right conditions to compete,grow and succeed.We will discuss retails future at length during NRFs annual Big Show next month in New York City.On behalf of the entire NRF team,have a wonderful holiday and a happy new year!24|End of the year
124、 reportMARKET REPORTS:USAFOCUSING ON THE OPPORTUNITIES Retail heads into 2023 facing brisk macroeconomic headwinds,but opportunities remainto drive up productivity and quality of experience,and tap alternative revenue streams.More positively,we anticipate a welcome easing of input cost pressures,ove
125、rall inflation in consumer prices and retail-specific inflation by 2022s holiday peak.These should reduce the pressures on retailer margins and alleviate the stresses on consumers wallets.1.Deploy Tech for Productivity GainsRetailers have renewed impetus to deploy technology that boosts productivity
126、 and increases customer conversion and retention.Inventory is the lifeblood of retailers,and managing it optimally has major implications for revenues,margins,working capital efficiency and consumer sentiment,which in turn affects revenues,margins and profits.Prescriptive analytics can improve custo
127、mer satisfaction through better management of inventory and assortment,customer service and adherence to safety protocols as well as lowering markdowns,reducing shrink and optimizing staffing.Retailers and brands leveraging inventory management systems can significantly improve their forecast accura
128、cy by using AI-powered forecasting tools.Adding external data such as weather,local calendars and consumer sentiment can markedly improve the accuracy of demand forecasting.Inventory management systems can also achieve other goals including reducing waste,improving financial metrics or reducing wast
129、e or the environmental impact of their operations.DEBORAH WEINSWIG FOUNDER AND CEO CORESIGHT RESEARCH25|End of the year reportMARKET REPORTS:USA2.Engage To Drive Long-Term LoyaltyA more challenging economic environment will not halt shoppers interest in more engaging retail experiences.Retailers mus
130、t continue to cross-pollinate the convenience of e-commerce to stores and the experience offered by stores to digital channels.Livestreaming represents one means of bringing greater experience to e-commerce and,so,presents opportunities to engage more fully with consumers,including a more loyal or i
131、nterested subset that are more likely to join a companys livestream.Livestreaming is about discovery,education,engagement and participation and brings back the fun of shopping,and it draws a direct line between consumer impressions and sales.Brands and retailers will need a cohesive livestreaming st
132、rategy to maximize effectiveness,which encompasses selecting the right platforms and hosts to reach and appeal to their target shoppers.Social media and video-sharing platforms enable access to large audiences but retail companies can nurture online communities through owned websites or apps,in orde
133、r to drive online traffic,sales and customer loyalty.Having control of livestreaming sessions on owned sites provides brands with greater access to first-party data that can be used to generate customer insights and improve personalization.3.Capitalize on New Revenue OpportunitiesIn 2023,we point to
134、 the opportunities afforded by opportunities in retail mediaa market that Coresight Research forecasts will have been worth around$75 billion worldwide in 2022.Long term,incremental revenues from advertising can offset some of the additional costs incurred in new channels and services,notably e-comm
135、erce and its subsegments such as quick commerce.Short term,these revenues can serve as a support for retailers in softening markets and can help offset increased input costs in price-sensitive non discretionary sectors.As competition for retail media dollars increases,retailers must provide efficien
136、t workflows,greater access to data and more accurate measurement within their retail media solutions.We expect retailers to most often partner with technology providers,as these providers can help retailers successfully set up,run and manage all aspects of their retail media networks.Among US retail
137、ers that have in-house retail media capabilities,almost half cited concerns over high levels of capital investment,according to a 2022 Coresight Research survey.26|End of the year reportSECTOR REPORTS27|End of the year reportTHE ACCELERATION OF UNCERTAINTYFor the past two years,retailers,including d
138、epartment stores,have learnt the hard and almost Clausewitzian way that business,just like war,is now the“realm of uncertainty”to paraphrase the military theorist.To be fair,only nostalgia would suggest that before 2020,business was a long,quiet river,as challenges have always been part of the job,b
139、ut the acceleration of chain reaction crises has transformed business as usual into permanent heavy weather management.After all,we are talking about no less than an unprecedented pandemic which gave way to social and political unrest,leading to a war,an energy crisis and the rise of inflation,compl
140、eted by environmental catastrophes and a supply chain crunch.No wonder retail leaders,as resilient as they may be,are trying to guess what is in store for 2023.At IADS,we see three top priorities for the year to come.DEPARTMENT STORESSELVANE MOHANDAS MANAGING DIRECTOR INTERNATIONAL ASSOCIATION OF DE
141、PARTMENT STORES28|End of the year reportDEPARTMENT STORESThe first one is of course to be able to deal,this year again,with extreme uncertainty.Even though it is essential,it is really hard to plan the budget for the year to come,as many of the parameters still remain unclear.While it is clear that
142、inflation is going to hit many countries,its amplitude remains to be seen,as it will impact relationships with brands eager to preserve their margins through retail price hikes,leading to consequences at the customer level and ultimately the retailers bottom line.This is all recurring in a context w
143、here profitability remains a priority to be able to invest in store experiences,online and supply chain capabilities,and system upgrades.In addition,as seen already in some markets,some weaker competitors might make decisions which could worsen market conditions,such as increasing salespersons pay t
144、o retain them,or offloading excess inventory.But while“plans are worthless,planning is everything”and being able to react fast to changing conditions is key,the right human organisation is required,which has a cost.The second priority that we see are the ongoing environmental and social concerns.As
145、we document it in our latest White Paper about sustainability and department stores(to be released in January 2023),addressing such concerns is all about being able to deal with a variety of stakeholders with different views and expectations(including retailers own teams),in a context of evolving bu
146、t uncoordinated international regulation.The most pressing issue is that while we already know that there will not be a one size-fits-all answer,there is also no clear solution already identified,as sustainability is“a framework rather than a destination”.And as shown already by some initiatives suc
147、h as the 2030 Breakthrough,department stores will be increasingly cooperating between themselves to learn and make progress together.Finally,such changes,dubbed“The Triple Transition”by McKinsey(systems,sustainability and people transitions),come at a hefty cost in a context of shrinking margins.Ret
148、ail leaders are pushed to review their business model to create new sources of revenue.This involves thinking out of the box and allows them to generate new initiatives,such as the Tailored Insight retail media program launched by Galeries Lafayette(a first in Europe),new partnerships with brands al
149、lowing them to propose infinite shelving to instore customers,new financial accords,or even bringing in a new typology of partners,as shown by Manor with Sephora or El Corte Ingls having the first Michelin-starred chef to ever team up with a department store.All in all,2023 will be,no doubt,another“
150、extraordinary”year for department stores,which will continue their transformative journey due,or thanks to,renewed uncertainty,as well as the need to find the key to sustainability,and finance it through new models.If needed,this is proof that collaboration groups and think-tanks,such as the World R
151、etail Congress and the IADS,are more useful and relevant than ever to help retailers cooperate and learn from each other.The International Association of Department Stores is an Association partner of the World Retail Congress.29|End of the year reportACCELERATING THE RACE TO ZEROSUSTAINABILITYPrior
152、ities for 20231.Mobilise retail associations from all over the world to join EuroCommerce,British Retail Consortium,the Australian Retail Association and many others in pledging to become Accelerators for the Race to Zero.Retail associations play a key role to drive climate action and support their
153、member retailers in setting out their plans to help limit global warming to 1.5 degrees by 2030.2.Share the tools,resources and support available to help retail associations and their members on their journey towards the Race to Zero,including the Race to Zero Retail Center of Excellence available f
154、or free to retail associations making the pledge to Accelerate the Race to Zero.3.Build strong partnerships to catalyse a movement within the retail sector to transition to a more sustainable,net zero future.With retail accounting for 40%of global emissions,we must go further,faster together to ensu
155、re a more sustainable future.Race to Zero Breakthroughs 2030:Retail is an initiative backed by the United Nations High-Level Climate Champions,founded by Best Buy,H&M Group,Ingka Group(IKEA),Kingfisher plc and Walmart,and hosted by the World Business Council for Sustainable Development(WBCSD).The gl
156、obal campaign aims to mobilize retail associations to engage their members and catalyze a net zero breakthrough within the retail industry by 2030.DJ FORZA MANAGER|RACE TO ZERO CAMPAIGN FOR RETAIL,HOSTED BY WORLD BUSINESS COUNCIL FOR SUSTAINABLE DEVELOPMENT30|End of the year reportTHE CONVERGENCE OF
157、 DISRUPTIONThe pace of disruption has accelerated.For an industry,consumer trust is everything,and the food industry rose to the challenges of the pandemic,took care of their customers and communities,and won meal occasions from other sectors.Looking forward,that trust is threatened by on-going prod
158、uct availability disruptions,labor and workforce challenges,inflationary pressures,which are not transitory,as well as threats to physical and cyber infrastructure.Today,however,disruption on several key issues has converged at an unprecedented speed.The duration of these challenges has immediate as
159、 well as longer-term implications.Food retailers,wholesalers,and suppliers of all shapes,sizes,and geographies must address these new challenges together with a renewed sense of purpose and commitment to collaborate to better serve consumers.FOODMARK W.BAUM CHIEF COLLABORATION&COMMERCIAL OFFICER|FMI
160、The Food Industry Association which represents the$800 billion US food industry31|End of the year reportFOODIt is often difficult to look up from the day-to-day operations of the business and see whats coming in the next few years.This is where FMI adds significant value to its members.Through our I
161、mperative Issues initiative,we have identified and prioritized issues that will have the greatest potential to affect the food industry in the next six to twelve months and the implications of the same over the next twelve to twenty-four months.There is broad alignment across retailers,wholesalers,a
162、nd suppliers in the prioritization and urgency of the issues.However,there are nuances between retailers and suppliers in terms of imperative issues priorities,particularly in the context of rising ESG expectations,impacts related to labor shortage and workforce challenges,as well as the role that a
163、ccelerating technology transformation will have on business models and go-to-market capabilities.In todays environment,it is difficult to predict the future with any certainty.The current state poses significant challenges that must be addressed with a sense of urgency more than at perhaps any time
164、in the history of the industry.Restoring supply chain equilibrium and addressing the significant workforce challenges will require breakthrough thinking and a new era of collaboration.The future presents new obstacles,but it also presents opportunities for those who are able to identify those obstac
165、les early on and lead the way toward innovative and agile solutions.The industry must focus on what is controllable through advocacy,including consumer education and public relations,collaboration with peers and trading partners,and education on best practices.Food retailers and suppliers have ident
166、ified key areas of focus encompassing a broad range of issues to include restoring access to frontline and skilled labour while addressing the ability to adapt to the future workplace.In the longer term,enhancing industry reputation and attractiveness is a strategic opportunity as the food industry
167、competes for talent.The supply chain requires near-term and long-term focus to restore product availability and to embed greater resilience in the system.Evolving consumer behaviours highlight the need to retain meal occasions,improving the omnichannel shopping experience,and addressing consumer dem
168、ands for transparency and trust.Environmental and social issues have risen in importance.There is a strong willingness to reduce food waste and the need to fight food insecurity and hunger.Navigating values-based social responsibility,while responsibly and sustainably stewarding the environment,has
169、now taken on a whole new level of importance.The changing marketplace will require an overarching need to protect pro-business policies and improve the economics of e-commerce.A common enabler is the acceleration of technology transformation designed to prevent cybersecurity breaches while accelerat
170、ing the adoption of automation.FMI has worked through the process of identifying and prioritizing these imperative issues in the midst of on-going disruption and uncertainty.We will continue to leverage and refocus our core services in advocacy,collaboration,education,communication,and research that
171、 will help food industry trading partners and related stakeholders navigate through todays unpredictable marketplace and chart a course into the future.32|End of the year reportCHRISTMAS WINDOWS33|End of the year reportA WINDOW ON THE HOLIDAY SEASON 2022Despite the increasingly challenging times,dep
172、artment stores around the world have clearly decided not to scale back on their Christmas window displays that are such an important part of the Holiday season.With thanks to our partner,the International Association of Department Stores for compiling this collection of the incredible window display
173、s and instore merchandising from some of the worlds top department stores.CHRISTMAS WINDOWSDENMARKFRANCEUSAUKHONG KONGVENEZUELASWITZERLANDITALYGERMANYMEXICO34|End of the year reportCHRISTMAS WINDOWS|DENMARK35|End of the year reportCHRISTMAS WINDOWS|FRANCE36|End of the year reportCHRISTMAS WINDOWS|FR
174、ANCE37|End of the year reportCHRISTMAS WINDOWS|FRANCE38|End of the year reportCHRISTMAS WINDOWS|FRANCE39|End of the year reportCHRISTMAS WINDOWS|GERMANY40|End of the year reportCHRISTMAS WINDOWS|GERMANY41|End of the year reportCHRISTMAS WINDOWS|HONG KONG42|End of the year reportCHRISTMAS WINDOWS|ITA
175、LY43|End of the year reportCHRISTMAS WINDOWS|MEXICO44|End of the year reportCHRISTMAS WINDOWS|SWITZERLAND45|End of the year reportCHRISTMAS WINDOWS|UK46|End of the year reportCHRISTMAS WINDOWS|UK47|End of the year reportCHRISTMAS WINDOWS|UK48|End of the year reportCHRISTMAS WINDOWS|USA49|End of the year reportCHRISTMAS WINDOWS|USA50|End of the year reportCHRISTMAS WINDOWS|USA51|End of the year reportCHRISTMAS WINDOWS|VENEZUELARETAIL LEADERSHIPFOR EXTRAORDINARYTIMES