Until the U.S. economy dipped in 2008, physical retailers did not consider online commerce a threat. After all, the internet did not offer the security shoppers were thought to value most. Over time online transaction technology improved and detailed product descriptions, and facilitated returns processes overcame shoppers’ need to examine items before they make their buying decisions. The internet, the rise of mobile devices to access the web, better and more ways to shop, the convenience of online browsing proved to be more competition than brick and mortar retailers could handle. Over the decade from 2006-2016, J. C. Penney, Sears, Sears, Nordstrom, Macy’s and Kohl’s posted a combined loss of $75B in market share. And for the same 10-year span, how did Amazon fare? From under $20B it grow exponentially to almost $356B in market share.
So why, now, are so many eCommerce giants opening physical retail outlets? The costs associated with starting and running an online business are substantially cheaper than establishing a brick and mortar. There are no leases for one thing, nor salaries for salespeople. Warehousing and distribution channels are less costly as well. It is just smart business today to start a business online then transfer it to Main Street or to the mall.

Where Startups Go to Thrive

eCommerce is also way kinder to startups. Statistically, nine out of ten new brick and mortar businesses will falter within a year. However, there are thousands of examples of thriving enterprises that got their start on the net. One such example: two short years ago, few knew about Warby Parker, which makes affordable prescription eyewear. The now-established brand has stores in select markets in strip malls and on Main Streets. The firm now earns more per square foot than long-time household name brands such as Best Buy and is giving Lenscrafters a run for its market share. Yes, Warby-Parker got its start online. Need another example? Everyone needs a mattress, but until a few years ago in this highly competitive industry, no one would have considered buying one without trying it first. Enter Casper which joined this crowded field online, established itself as a luxury mattress brand, and is now making its presence known in select shopping malls throughout the country.

Okay, that scenario makes sense for new business. But what about these eCommerce giants? Amazon did not go all in. Not at first. It tested the waters by opening zilch cost to maintain kiosks in malls across the country. Most of these outlets succeeded leading to Amazon’s more ambitious foray into physical retail. What is their game plan, and what’s in it for them that they are stealing a page from brick and mortar’s playbook?

Turns out, to fully reap the benefits from all possible revenue streams, online giants have to reach stalwart brick and mortar shoppers. To partner with resellers at brick and mortars is just not as economical as setting up their own shops. For Google, Amazon, and most notably Apple (who still maintains profitable relationship with resellers) this model is fast becoming a well-worn and very profitable. Think how quick but impersonal it is to buy personal technology such as Apple’s latest iWatch, iPad, or iPhone without being able to hold it and run it through its paces? Should you go to a reseller such as a cell phone provider, however, that environment is one of hustle and hurry with profit, not service, as their goal. But go to an Apple Store, and these sleek beacons of the latest innovative gadgetry allow you to roam freely, examine any product you wish, and purchase or just ask questions of knowledgeable staffers.

So what are consumers and retailers alike learning from this new shopping experience? To begin, brick and mortar retail is not dying. Instead it is going through a major period of adjustment and readjustment. The business model is changing due to shifts in consumer buying habits. And impulse is fickle. That paradigm can and will change, but the concept of going into a store, seeing, touching, sampling, and selecting merchandise is not going to disappear any time soon. There may be fewer sales staff to assist, as is the case with big box stores such as Home Depot who have moved almost entirely to self service point of sale stations.

That said, one key function of the buying experience will never change: personalization. When consumers no longer feel that their needs are being fully served online, they will return to brick and mortars to regain that control over the sales process. When they do, they’ll be in for a surprise. In their absence, even big box retailers will be operating from smaller premises. From the seduction of no or low-inventory supply chains and distribution centers to semi-automated checkouts, the interactive aspect of online shopping has come home to roost for physical retailers. Perhaps a happy medium has been struck. Time will tell.

The post Why eCommerce Giants Like Amazon are Opening Brick and Mortars appeared first on Newton Search.

Except for Apple Store, this author has little interest in visiting the nearby mall. However, a recent trip to that emporium provided grist for this article. If the state of the economy can be gauged by the number of cars in the parking lot, then as a nation we appear to be doing well. It still takes upwards of five minutes to locate a convenient place to park. If that’s true, then what is going on at CVS, Bed, Bath, & Beyond, the Gap, and even J.C. Penney’s???!!! People still need toothpaste, towels, trendy jeans, and dad shirts, right? These household name retailers’ reach extends clear across the country and for many, their storied history goes back almost 80 years. And yet all of them are closing a disordinate number of stores this year.

But wait, there is more! Perennially in trouble, it seems, Sears is yet again, declaring it has to close stores to stay alive. Not to stay in the game, mind you, to stay ALIVE. The brand even sold its proprietary brand of Craftsman tools to Lowe’s, which incidentally is also closing stores left and right. Its major competitor Home Depot isn’t, but Lowe’s is. The message here is that construction starts have increased and HD caters to contractors. Lowe’s demographic is the homeowner. Yes, in real estate it is a seller’s market, but dollar for dollar a truckload of lumber and drywall costs way more than a patio set and barbecue grill.

Macy’s, that legendary 19th century retailer, is selling its flagship store. Yes. Herald Square is going up on the block. The auction block. Last year Lord & Taylor allied itself with Walmart, a move which would have been unthinkable only a few years ago, but today, somehow, it just seems right. Taking their cue from other big box stores, Kohl’s, Target, and even Starbucks, who posted less than stellar holiday figures in 2018, are heading off trouble at the pass and closing stores that are losing business, while allegedly opening new outlets in less competitive territory.

Consumers’ Buying Habits Shift to Shopping Online

And given the international reach of the internet, just where would those less competitive regions exist? That may actually be at the crux of the matter. The economy may not be quite as bleak as our storefront observances seem to be telling us. The fact is, that the internet has made binge shoppers of us all, and with upgraded blockchains and distribution options, we can be in bed shopping for items and waking to find they have arrived on our doorstep overnight.

Such options make it much easier to purchase just about anything, and customer service as well as the returns processes have been honed to a near science so there is little risk for consumers. The almost instant gratification from buying at a brick and mortar has been the ‘Night Before Christmas’ expectation that a package full of goodies, or at least the paper towels you need, will arrive before you run out.

There is another reason that consumers are turning away from shopping locally at their big box stores. Choice. When you buy at a local store, a staffer, a Buyer, has determined what merchandise, styles, brands, at what prices people in that area can afford, and more importantly, what will turn the store the biggest profit. On the internet, however, the shopper is the Buyer, and the world is their playground. Like European fashion? As it turns out, Europeans like American dollars. So many foreign-based website businesses have English and American versions where it is easy to see the price for goods in our currency as well as the option to have them shipped quickly and affordably.

Back down at the shopping mall, one hears that so many big name retailers, mostly from the world of fashion, are trimming back their overhead. That means closing expensive-to-run brick and mortars, and shaving the cost of staff/salaries in favor of boosting their investment in their online enterprises. Its easier and more profitable for retailers to invest in their supply and distribution chains. Online retailers can save on warehousing as well since they can arrange to buy direct from manufacturers thanks to technology-driven distro upgrades.

For consumers, the Point of Sale aspect of buying online has vastly improved over the past decade. Shopping carts and transactions are now encrypted to the point where consumer trust has been gained. It is a brave new world in retail. Those who will survive will not only pay close attention to what consumers want, but anticipate their needs and get there beforehand.

In an interesting sidebar, seasonal retail jobs such as around the winter holidays, used to be a metric to close out unemployment figures on an uptick. Those statistics seem to remain low, however for the last two years retail job openings during the fourth quarter have nose dived. Retailers, such as Walmart, have opted instead to offer overtime hours to their existing staffers and not hiring on additional workers during the so-called busy season leading up to Black Friday, Thanksgiving, Hanukkah, Christmas, and New Year’s.

Finally, this author, who is well-rounded intellectually and physically, is not saddened to see that Victoria’s Secret, which celebrates the svelte female form with scanty underwear and lingerie, is closing 53 stores in 2019. This is a record for the chain as the number represents 3x their norm. However, the economy and the internet got nuthin’ to do with that! Analysts say that the majority of women, and their husbands, favor comfortable underwear styles in natural fibers that are more size-inclusive. What waaaaah!

The post Taking Retail’s Pulse in 2019 appeared first on Newton Search.

These trends will dictate the future of retail

One thing brick-and-mortar stores have that online shopping can’t provide? A personalized experience of sorting through tangible items. Sure, you can scroll through your phone and browse items with pictures and descriptions, but that’s not the same as seeing things in person, especially for personalized items like clothing.

Brands can also perpetuate their own culture in brick-and-mortar stores, which can’t be replicated in any way, not even with a strong web design. Everything from the ambiance, to the smells and vibes you get from staff and turn a shopping chore into an experience that you can take with you.

New levels of retail merchandising will also offer an interactive approach that cannot be replicated online. This will go hand-and-hand with the culture brands will look to animate for their customers.

This is one way a brand’s culture can really come to life

In any business setting, efficiency is the way of the game. To compete with rival brick-and-mortars and online retailers, artificial intelligence will introduce big data and machine learning to stores that will help them operate smarter. It will use analytics to measure customer behavior and analyze trends, which help them predict future purchases.

Expect to see more small, even pop-up stores that cater to niche consumers. They are evolving from the once, heavily-relied shopping malls. These will have dedicated staff designed to help customers feel like it’s their custom, shopping experience. Because these small stores are designed for a more specific kind of shopper, they will work to be more productive and lead to a stronger word-of-mouth reputation.

Big stores give the illusion that consumers are on their own and THAT’S what the online experience can replicate, only in a more comfortable manner. Re-creating the personal experiences of the “old days” is what will bring back the joy of shopping.

Retail stores are taking the personal experience to mobile devices as well. For the past few years, retail brick-and-mortars are utilizing SMS text marketing to send promotions and exclusive offers via text messages. We see this trend heading upwards and expect stores will leverage these more, with how much more people are becoming involved with their mobile devices. These messaging strategies have a softer, less aggressive appeal than app-based messaging (plus they don’t require consumers to have downloaded a specific app).

The post The State of Retail in 2019 appeared first on Newton Search.

Just what information generally appears on a background check? Social Security numbers are verified, credit reports, criminal records including pending charges if any. While it may seem alarmist to perform a verification of the information presented by a potential new hire,there are very valid reasons for checking into a prospect’s background. According to the Department of Labor, just one bad apple, we mean applicant, can, if hired, has cost over 27% of U.S. companies over $50,000 a year in losses.

Generally, today’s businesses that perform background checks do so to minimize risk. One such example is to ensure a safe workplace. If a person causes harm to a coworker, the company is negligent and could be sued. Investigating the person before hiring might have revealed the person’s potential to cause harm to other staffers. Another reason, especially for retailers, is ‘shrink’ otherwise known as employee theft. This is the leading cause of loss for any product-related business. This is where a background check that could reveal an arrest record can be instrumental in ensuring that business profits increase and losses decline.

In some highly competitive industries, applicants have been known to pad their resumes by claiming to have degrees from certain colleges and universities and by presenting paper certificates as proof. However, in this day of PhotoShop and similar graphics programs, such certificates can easily be fabricated and printed. While today there are few individuals who have not been to college or who may be currently pursuing degrees online. These persons may have attended certain schools for a time, but possibly in another discipline other than the one in which they are applying, or perhaps never finished the full degree program. Still others may claim to have hold a diploma for a four-year course of study, but only earned an associates degree, or took a certificate course instead. In this way, screening applicants by checking not only for criminal actions, but also to see if they are in fact, suitable for the position is a great idea. It not only thins the herd, but also allows the best and most qualified candidates to shine.

Stop Product and Productivity Losses

Many companies now provide equipment for certain members of their staff, such as cell phones laptops, and even vehicles. Usually, these company-owned properties are provided with the express understanding that the device or vehicle is not for personal use during business hours. Increasingly these ‘perks’ are provided preloaded with tracking or ‘spying’ software applications and even GPS.This way employers can continue to perform random and routine background checks such as the exact location of a vehicle during the workday. They can keep tabs on their staff and quickly spot any negative or dishonest use of their vehicles or worker’s actions during while ‘on the clock’.

While most employees are honest, there are always a few who will attempt to game any and every system. Profitability is not always measured is hard dollars and cents. In other words it is not always what you make but also what you keep. For example an employer might want to know if a prospective sales call was ‘legit’ or not. Did their sales team actually go to their scheduled client meetings and if not, why not? Other ways that some dishonest workers pad their accounts are through ‘trips’ that never took place. Does their invoiced mileage dovetail their vehicle’s odometer data? A vehicle GPS system can alleviate concerns and target dishonest employees.

It is a fact that many people lie about their skills and accomplishments on their resume. For those who ‘embroider’ their resumes, their deception and shortcomings are generally quickly discovered, but only after they have reduced productivity, and cost the company human resource man hours. However, there is a limit to what may be probed in any person’s background check and, many databases, especially those in different states, are not easily accessible.

For example, before hiring a maintenance worker, a small company Googled his name, or, in fact, the name he provided on his resume. No issues were found. A few months later, however, the company President was drinking coffee and watching the news at home early one morning and was surprised to see a follow-up story about his maintenance foreman’s previous arrest. He was shocked to learn in the broadcast, that his employee also had three prior arrests, all under a different first name. An examination of his trackable company-owned tablet revealed that the foreman had been scouting his next robbery victim online while using said device. His actions provided ample proof of his criminal activity to law enforcement. That company now thoroughly background checks every prospective new hire.

It has often been said that one only has one chance to make a first impression. It is important that businesses safeguard themselves by making sure every applicant is indeed, putting their best foot forward. Today, to guarantee the safety of their workers and workplace, their bottom line, to find the best and most qualified candidates to join their staff and protect their most important feature, their corporate reputation, are the main reasons behind business background checks. So going forward, for those at any time in their remaining working lifetime may expect background checks, both random and routine, to be a staple among American business practices and therefore their job hunt.

The post Why More Employers Now Perform Background Checks appeared first on Newton Search.

Perennial Plaid

Plaid is seldom out of style, but this year trad-plaid steps aside. For Fall 2018 plaid is amped to include outsized stripes and vivid colors. Seen mostly in outerwear, these investment pieces might prove a tad bit loud in a few seasons, so if you buy for the long term, consider more subdued colorations.

It’s a Jungle in Here!

Like plaid, animal prints, specifically jungle, are having a moment. Also as with plaid, the patterns are more graphic, and the colors exceptionally bright. This is great news if your faux leopard coat has seen better days. Or, you can double your pleasure with a special occasion dress in silk knit. What about pink cheetah?

If 80’s Pop Songs

…are the soundtrack of your life, you are gonna love the 1980s revival over the next year! Material girl high kitten heels and shoulders from another zip code, abstract floral prints, raglan sleeves, color-blocked solids, and did anyone say, ‘outsize’? Don’t say we didn’t warn you!

Prairie

Annie get your fun because sweeping long skirts, calico prints, embroidery (it’s not just for Boho anymore), Victorian sleeves, and wovens are having their day in the sun. Be sure to pair with a substantial pair of low-heeled leather boots to provide the appropriate amount of swagger as you stride down the sidewalk en route to the office.

Oversized Shoulder Bags

Not to be confused with double-handled totes, or crossbodies, the handbag du jour is a shoulder bag. And the larger the better. Many designers are giving this look ‘legs’ by including a second pair of handles, making it easy to convert this investment piece into a tote bag when its popularity wanes, or the wearer’s chiropractor visits become too frequent!

Bright Eyes

Another accessory trend is colored lenses for sunglasses. Whether subtle or bright, the aim is to banish brown, gray, or black lenses for a time and to conquer UV rays with an inner glow of your own! Frames BTW, are primarily wire or subtle, thin solid color plastic to allow lenses top billing.

Binky, Binky, Binky

Seen on the runways, and likely to mainstream as oversized ski wear (think snowboarding attire from the 90s) is the Blanket Coat. While the concept lends itself best to sports apparel, major designers such as Pucci and Balenciaga showed this look as elegant evening wear.

So Long Neon

Say hello to iridescent! If you’ve ever been fascinated by an oil spill in a puddle, then you’ll understand the concept. What is not easy to grasp is why anyone would want to sport this look, but there are subtle interpretations among the garish statements seen for Fall 2018. For a toned-down version of this look, try two-toned taffeta in an evening skirt, not an entire outfit. Remember, more outre looks can make the wearer resemble a refugee from the circus. Incorporate any extreme trend into a more refined silhouette for maximum impact.

Womens Wear

It has only taken over a 150 years, and doubtless influenced by Madonna, but man-tailored suits are receiving a decidedly feminine outlook. While most of the looks seen on the runway are too revealing for office wear, some of the details that highlight the feminine form such as pinched waists are a welcome change. For occupations that require women to wear suits or suit jackets, look for solid colors, in white, charcoal, or black, interpreted with contrasting tie belts in soft leather.

Fuchsia

This is a color any woman can wear, however, it is usually available in small doses, such as in an accessory. For Fall 2018 through 2019, Fuchsia is the color of the moment, widely interpreted on runways in the U.S. and Europe as outerwear. If fuchsia is your color (it is for this author) then prepare to break the bank. This is your year to stock up on your favorite hue!

One takeaway to remember is that fashion is a business. To inspire repeat business the often garish runway looks will be reinterpreted by mass-market designers. Expect to see dilute versions of this Fall and next Spring’s styles appearing in Kohl’s, Macy’s, J.C. Penny and other popular retailers soon. The hologram oil-slick look may reappear as a backpack for school children, or a pocket on a hoodie sized for Juniors. The Prairie look will have wide appeal with tweens and soccer moms, and female attorneys can look forward to suits without severe man-tailoring, and perhaps, more feminine tailoring. For those considering the purchase of a winter coat that features a giant canary yellow plaid, appears to have been made from a comforter, or is screaming, ‘look at me I’m fuchsia’, here as with most extreme fashion statements, let your lifestyle and your wallet be your guide!

The post Top Fashion Trends Fall 2018 – Spring 2019 appeared first on Newton Search.

Personal Electronics

Wireless Headphones: Wireless headphones became extremely popular a few years ago. The latest offerings are from the ‘big-name’ media brands such as Bose. Their SoundSport Free claims to offer ‘truly wireless’ earbuds that only connect to your device via Bluetooth, ergo, no wires. Available only in orange, the SoundSport is Android-friendly, thereby giving Apple AirPods which only connect to Apple products, a run for their holiday revenue. Available through Amazon, it goes for $200+ tax and S&H.

For wireless connectivity AND noise-cancellation, Jabra’s Elite 65e is the one to beat. Also Android-friendly, it also commands $200+ tax and S&H to get it home.

Fitness trackers and Smartwatches

For centuries, a person’s watch has represented their position in society. In recent years, the brand one flaunts also speaks to how the wearer wishes to be perceived. For that there are usually two camps: Apple and everyone else. So it goes with fitness trackers and smartwatches. This year’s big item is Apple Watch Series 3 featuring the latest updates including cellular connectivity. Its gauges are small, but if the wearer has 20-20 vision, it is possible to perform the same functions on the Series 3 that the best tablets offer. Available for $300+ tax and S&H if ordering online.

Among fitness trackers Fitbit reigns supreme over a wide range of competitors. The original and still the best, the latest version provides echocardiograms and advanced step tracking. For those who just want others to think that they are fitness-oriented, it tells time pretty good, too! Retails for about $200 online. Well, somebody somewhere was bound to come up with this: the smartwatch/fitness tracker hybrid. Withings’ activity tracker resemble a sleek, business-savvy timepiece that can be worn anywhere and does not remotely resemble the clunky, sporty, muscular smartwatch. It is competitively priced at $200 online via Amazon.

Smart Homes

voice speakers:We’ve all seen the ads for homes that seems to anticipate their owners’ needs and fulfill them. Smart displays/voice speakers are now in their second generation and offer small screens that perform tasks as well as interact with users. Amazon’s Echo swept the field for several years with nary a competitor of note. New this year is the Echo 2 which features a screen among other upgrades. The Echo syncs with Amazon’s paid services such as Prime video or Amazon music. It goes for under $250 online through Amazon and other retailers.

For 2017, Google entered the field, and this year is coming on strong with TV and print ads for their new Home Hub. A voice activated speaker display with a screen, the device connects to a user’s Google account to display selections from their Google Photos. It will play selected YouTube videos and perform Google Assistant tasks such as read a daily schedule, relay the weather report and any commutation issues. Head to head, the Home Hub is significantly cheaper than the Echo, under $150 at Google, and does not require any paid subscriptions, just accounts with the various Google functions.

Security Doorbells

Every had a package or mail go missing? Or want to see if the caller at the door is worth getting dressed for? Smart or security doorbells have become very popular since their inception and can be used as stand alone video recorders or as part of a network of smart devices throughout the home. The most widely known is the Ring, which is easily controlled by voice activated devices. It is ideal for those with Amazon Prime memberships who may have auto-subscriptions through this service and receive several packages weekly. Prices vary but generally it retails under $200 through Prime.

Not to be outdone, Nest, which also makes smart thermostats, was recently acquired by Google. It’s products integrate seamlessly with Google Assistant so this might offer the best option for your household. It runs about $230 at a range of retailers including Walmart.

Recreation

Drones: Drones return as the best item to buy a budding geek or frankly, a geek of any age. While not yet at the stage where this technology is used to delivery packages, they can be used by anyone (including governments) to take aerial photos. Of these, the DJI Spark is extremely popular and while considered a ‘mini drone’ it can be programmed to record images while in flight with just a wave of the controller’s hand- no remote or smartphone required! Walmart has them, at a base of $400. Too rich for your blood? Amazon has an under $55 mini that lacks the hand gesture control, but will take a photo and be controlled by a smartphone app.

Entertainment: Once upon a time, one bought a TV and it lasted forever. Along came cable and its competitors which soon priced itself into the stratosphere and strained many consumer’s entertainment budgets. Now with tech advances introduced for the winter holidays, the Smart TV, specifically the 4K which offers almost limitless viewing options, is at the top of most families’ wish lists. Why? It provides a necessary upgrade for those who enjoy their TV as the entertainment hub of their home, and while there are many extremely high-end options, the technology is also available for less than $300.

Technological innovations seldom come cheap. Many will look on these gift suggestions and experience sticker shock while others will whip out their fast plastic with aplomb and nary a batted eyelash. Remember, for those whose budget will not allow such extravagances, there are always gift cards in whatever denomination will be well-received, yet not break your budget.

The post Top Holiday Tech Gifts for 2018 and Beyond appeared first on Newton Search.

Over the last 35 years many women-run enterprises in the fashion and entertainment fields have met with extraordinary success. One of the first was Kate Spade. Ms. Spade positioned herself as her brand’s ambassador and leveraged her company through a succession of buy-outs. In each negotiation, however, she retained design and quality control. Kate Spade was not only the eponymous brand but also its high-profile face. Ms. Spade made appearances on red carpet events around the world. A published author, she also kept a hectic schedule of book signings across the country. As such she was widely recognizable, even by those who do not own her merchandise.

No firm starts its life as a global lifestyle brand. In fact, Kate Spade did not study design in school, nor intended to become a designer. She majored in journalism and after graduation logged six-years at Conde Nast’s Mademoiselle magazine. Dining out one night with her husband, Kate was intrigued by his suggestion that she start her own handbag design business. To date Ms. Spade had never so much as sketched one, but she set about researching and designing the ‘perfect’ handbag, originally of ballistic nylon with leather straps. With her husband as her business partner, and upper middle class women as her demographic, in 1993, Kate Spade, the business, was launched.
Building the Brand

Kate Spade’s designs addressed the needs of the 24-hour professional woman. The woman who gets the children off to school and herself to work, to the gym, shops for groceries, takes her vitamins, and looks fit and refined while executing all the required tasks of modern day family life. The Kate Spade woman takes care of herself, top to toe and inside and out. Soon there was a Kate Spade handbag for every one of these personas. Sales soared and investors took notice. A combination of customers and a recommendation that stock in her publicly-held company was a good buy provided the catapult the brand needed.

By 1998 sales totalled $27 million, which attracted Neiman Marcus as a business suitor. That year the luxury retailer paid $34 million for a 56% stake of the company. The brand flourished under this new partnership. By 2006, sales reached nearly $99 million, and Neiman Marcus Group acquired the remaining 44% of Kate Spade for just under $60 million. By the early 2000s, Kate Spade expanded its reach worldwide and its line to include stationery and desk essentials, shoes, beauty products, eyewear, as well as a full women’s clothing line. In November 2006, Liz Claiborne Inc. purchased Kate Spade for $124 million from Neiman Marcus Group. Last July, Tapestry, Inc. (formerly known as Coach, a rival handbag and lifestyle brand) acquired Kate Spade for $2.4 billion.

While the loss of this dynamic talent is devastating, Kate Spade the brand, will likely continue to evolve and gain even greater market share. That is because the most successful brands are structured for continuum. They are businesses, after all. That is, should their CEO, brand icon, or lead designer leave, the enterprise locates another rising star to continue designing the line in the style of the founder. Some well-known examples in this very industry include Yves Saint Laurent, and Anne Klein. On his retirement, Saint Laurent, the icon of French haute couture was superseded by Karl Lagerfeld, his long-time design rival. And after her death, Anne Klein’s label, once solely available at high-end retailers and her upscale boutiques, branched into several lower priced ready-to-wear lines, including a label for plus sizes and petites. These lines’ evolution demonstrated that fashion is big business and the show will go on.

Perhaps the greatest legacy that Kate Spade, the designer has left us is the fact that through her determination, drive, and her thorough knowledge of her demographic, she grew her brand by delivering products that they both need and most important, want. By following this blueprint, the successors driving her design empire and brand will likely surpass even the greatest dreams and ambitions of its founder.

The post The Future of the Kate Spade Brand appeared first on Newton Search.

Whenever a retail giant falters, their management is quick to blame the lagging economy. For Toys R Us, industry speculation has it that blame should be directed at management, which, since 2005 has been leveraging its debt to outrun the grim reaper. By the end of the third quarter 2017, however, the reaper was breathing down hard on this once strong enterprise. This is what happened. Thirteen years ago, the chain went private, the result of a $7.4 billion leveraged buyout by private investors. For a few years, profits were sufficient to pay down the debt. However, Toys R Us’ management team did not recognize or acknowledge that consumer spending habits were shifting even as the number of the chain’s competitors was growing. All too soon profits were down and debt interest kept on accruing to the point where the chain had no recourse but to file for Chapter 11 protection.

2017 Was A Rough Year for Retailers

What went wrong? What didn’t! To begin, a major issue was the stores themselves, most over 100,000-square feet, with considerable overhead to maintain. Inventory was often inaccessible, high on gondola shelves beyond easy reach, and customer service virtually non-existent. In short, at the store level, there was no attempt at enhancing the shopping experience for consumers. Shoppers appreciate the convenience and will take their business, and their dollars, to chains that fulfill their expectations and their needs. Chains such as Walmart and Target emerged as major competitors both as retail outlets and online. At these chains, shoppers can buy anything from groceries to greeting cards, tires to, well, toys. To be fair, there was at least one Toys R Us aisle dedicated to baby needs, such as diapers, cotton swabs, and formula, but not at competitive prices. Even so, it was way too little, way too late. The era of one-stop shopping had emerged, and Toys R Us missed the memo.

To be fair, 2017 had been the year of reckoning in the retail industry. Numerous household name enterprises filed for Chapter 11 protection, among them Michael Kors, Payless ShoeSource, Sears, J.C. Penny, Abercrombie and Fitch and Macy’s. To survive, these retailers will shutter many of their stores and roll back on inventory. In this age of digital technology, perhaps the biggest shocker was the consolidation of Radio Shack, which once boasted over 7,000 outlets, and is now down to under 100 corporate stores and a few hundred franchises nationwide. To set the stage for a further discussion of where Toys R Us went wrong, here is an overview of the current retail climate.

There is a glut of available retail space already in the U.S. as the economy still recovers from the 2008 downturn. Many strip malls have at least one 50,000-square foot empty storefront which deters customers from patronizing other stores in the shopping center. Based on the shift in consumer shopping habits, a trend toward smaller brick and mortars, supplemented by robust online enterprises, have emerged over the past decade. Except during the December holidays, toys have never been a strong sales category. In addition, it is a trend-centric industry that has always suffered from a faulty design through the distribution process.

Today’s Retail Competition Is Online

Over time, Toys R Us has shifted from being killer of the smaller toy retailers to being possibly mortally wounded by the new industry goliaths, chiefly Amazon, eBay, Target, and Walmart. In hindsight, the presumed end of Toys R Us is a wakeup call for retailers selling non-necessity merchandise such as toys, decor, luxury items, recreational, and fashion. Their management must acknowledge, accept and adjust to changes in consumer shopping and spending habits. These executives and investors need to understand that consumers no longer make shopping an event and the mall their destination. Instead, everyone can shop at any time of day, anywhere in the world, and not be limited to retail buyers’ limited selections for their perusal.

Today’s Retail Survival 101

What is the solution? Sweeping changes, beginning with revised business models that reflect current consumer buying habits. Another absolute is to build and maintain a stronger online presence, but most of all, to continuously gauge and fulfill their customers’ needs. Brick and mortar retailers need to put their shoppers and customers first by engaging everyone who enters their establishment. Providing personal attention includes inquiring as to their purpose for shopping, then swiftly assisting them to locate merchandise and buy it. After all, online it takes only a few keystrokes to select an online store, a few more keystrokes to select merchandise, and the most sophisticated shopping carts to facilitate the sales funnel. That’s their real competition.

To conclude, the biggest issue that lead to Toys R Us’ downfall may have been their executives’ and investors’ unwillingness to change with the times, instead to retain and struggle to maintain their failing status quo. Their inaction changed the one-time industry giant into a sitting rubber duck, marked down and relegated to the clearance bin.

The post Where Toys R Us Went Wrong: The Lessons Retailers Must Learn appeared first on Newton Search.

First some backstory. In the third quarter of 2008, a global financial crisis erupted. It was caused by worldwide deregulation in the financial industry. These actions allowed banks to engage in hedge fund trading with derivatives. Hedge funds are privately-owned firms that pool investor’s money and reinvest these funds into often risky and unregulated instruments. The goal is to outperform the market and return high dividends for their clients.

The odds for the success for any high-risk venture are not great. In fact, these investments have underperformed the market since 2009. To compensate, banks turned to the same lending instrument they had used during the previous downturn in the 1980s- mortgages. It was a decision that was doomed to failure yet again. The Federal Reserve continued to raise the federal funds rate which means that the prime lending rate mortgages are based on rose as well. In response, housing prices began to fall as supply outpaced demand.

Why the Bubble Burst

Caught in the middle were homeowners and businesses who could no longer afford to make payments on their balloon, interest-only, and adjustable mortgages (many opted in as these were easier to obtain than fixed-rate loans). Worldwide, the defaulted loan rate soared. That action lowered banks’ incomes which are primarily based on the interest each receives from the number of loans they extend. As of 2007, these risky loans had grown into a $1.3 trillion industry. At the same time, these loans were creating an asset bubble, which can only burst. The banking crisis came to a head in 2007, and its trickle-down effect on Wall Street the following year.

While banks formed the epicenter of the 2008 financial meltdown, the stock market was the first to start the rally that began to bring the economy back to acceptable levels. Which sectors rallied first? Which are undergoing a renaissance today and who is poised to succeed next? It is important to know that the economy is not static. Also that it tends to run in cycles. During the recent ‘adjustment’, however, a number of industries were able to right themselves and to stay the course: Beverages, Power and Electric, Retail, Consumer Goods, Precious Metals, and Mining. As a result, the economy saw steady growth over an extended period that exceeds the normal 58-month average. Over time these industries were joined by others, which also further strengthened the economy.

Picking Up the Baton

Today, according to Sageworks, a financial information company, Information-technology and Construction firms dominate as the fastest-growing industrial sectors. Collectively, IT companies posted an average of 18% sales growth through December 31st, 2017. Compared to all industries posting gains last year, IT and Construction’s increases were almost double that of the pack. These gains speak to consumer and business needs such as housing requirements, as well as software development and testing, computer systems’ design, and IT infrastructure. As expected ancillary businesses are also thriving. For example, construction trades, supplies, and suppliers such as building finishing, foundations, exterior work, contractors who install or maintain utilities, elevators, civil engineering, dredging, and roadwork, all posted gains of 13% or more.

While the U.S. economy is not yet booming, it is at least humming along relatively smoothly. Remember, when the economy peaks, that high will be short-lived and will be followed by a trough that impacts consumer employment and spending habits. Today Construction is on top, however, it is this same industry that suffered the heaviest losses during the 2008 economic downturn. So then, what are the next great industries poised to experience growth over the next 5-10 years?

Crystal ball notwithstanding, the Bureau of Labor Statistics projects that the goods-producing sectors, manufacturing, professional and business services, state and local governments, healthcare, retail, and hospitality industries will post the highest job openings, therefore are expected to post the highest economic gains through 2025. If there is a lesson to be learned regarding the economy, it is that it rises and falls. For those in industries that have posted historical peaks and valleys, it would be prudent to save while you can, as booms never last.

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