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Why Fashion Needs a Three-Pronged Merchandising Plan of Attack Through COVID-19

The retail industry is no stranger to crisis, whether it be regional like a hurricane or national like the recession of 2008. But today, as the coronavirus pandemic plays out across the globe, retailers find themselves with either an abnormal (and unsustainable) spike in demand or virtually no demand. Strategies for managing this in the short-term are already underway as apparel brands and retailers formulate a normalization process and handle seasonally obsolete inventories.

But the discussions that come next as retailers model their long-term merchandise planning and allocation goals will be based on past disruptive experiences, adjusted to fit the unique challenges of this new situation. Apparel brands and retailers need to start investing in the following changes: an accelerated shift to digital, a redefinition of the supply chain and a redefinition of the workplace.

Accelerating the shift to digital

While it is still too early to predict the extent of the shift, there is no denying that retail will become increasingly digital-focused in years to come. This shift will accelerate but will likely be less dramatic than some models are predicting. Despite the highly anticipated innovations designed to improve the digital shopping experience, online shopping will never fully satisfy the social aspect of a trip to a brick-and-mortar store. But before it is safe to return to the traditional shopping experience, omnichannel strategies such as buy online, pick-up in store (BOPIS) will continue to grow along with curbside pick-up offerings.

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As both the industry and global health situation are rapidly changing, retailers need to monitor trends and devise up-to-date strategies to best meet these changes now, and in the future. This shift will challenge margins and increase the need to shore up omnichannel planning, price management, and allocation and replenishment capabilities within the organization. These elements will need to be considered when anticipating how the channel mix will reset when things begin to get back to “normal.”

Redefining the supply chain

Prior to COVID-19, there were flaws in the supply chain, but the high level of dysfunction that has ensued was unfathomable. Moving forward, supply chains will need to adjust, and executives will need to devise risk mitigation strategies for their existing supply chains.

Retailers will want to counter source manufacturing and raw materials from a multitude of countries to decrease the dependency on a single nation for the flow of merchandise. Next, retailers should consider a necessary re-assessment of how safety stocks are managed. Businesses will become more inclined to maintain buffer weeks of supply on key items, versus just-in-time amounts, to compensate for supply chain disruptions.

As retailers bounce back from their current financial burdens, they will take a hard look at the amount of cash tied up in inefficiencies within the supply chain. In the future, successful businesses will leverage customer data analytics solutions and customer collaboration platforms in conjunction with digital product development technologies. Digital platforms can analyze the appropriate data to compress the product calendar, reduce sampling and product development costs, narrow assortments, increase customer conversion and improve margins to minimize long-term inventory problems like the ones today.

These changes will likely be implemented across the industry in the months eventually following the COVID-19 crisis, but the sooner the better. If leadership teams start considering these innovations now, they will be able to free up considerable cash from old inefficiencies and surpass competitors.

Reinventing the workplace

Potentially the most far-reaching change resulting from the COVID-19 experience will be the need to reinvent the workplace. This crucial restructuring must account for more robust disaster recovery and business continuity plans. Retailers should consider appointing a leader who will study the actions being taken during this crisis and map out how merchandise planning and allocation functions should look with a primarily remote workforce.

Furthermore, business structures are currently centered around the work-from-home experience. Innovative technology has kept workers engaged, while redefining the logistics. This will drastically impact the work-life balance as employees re-connect with what is most important in their lives. Successful retail managers should continue to leverage the technologies they are utilizing now and reconsider offering flexible work scenarios for employees and external partners.

Managing for the future

COVID-19 sent unprecedented shockwaves through the retail industry, and every retailer will have to make major adjustments to “business as usual” if they hope to succeed. Learning from the past and leveraging these tips will help your business create a long-term merchandise planning and allocation strategy, mitigate future risk and prepare for whatever comes next.


Rich Pedott is a partner with Columbus Consulting and has more than 34 years of experience across multiple functional disciplines, including planning and allocation, sourcing, supply chain management, and store operations. He has led strategy, process and systems development initiatives at several leading U.S. and international retailers and has a track record of successful implementations that deliver bottom-line results. Additionally, he is the co-author of “Omni-Channel Retailing: How to Build a Practical, Effective Plan of Action.”