In our most recent Merchandising research, we quickly discovered that, for most retailers, the departments that need to be in line most when it comes to merchandising – Marketing, Supply Chain and Stores – are working at cross purposes. Retailers are aware of this, yet so far, they have been unable to remedy the situation. With this reality looming, all other inhibitors become just that much more daunting, and we are not surprised to see retailers looking outside of their organization for help more frequently.

As evidenced below, retailers increasingly hope that technology – and the people who provide it – can help ease their pain: improving speeds of planning solution and computing systems, data feeds and integration points is now their number one inhibitor.

Figure: Inside Looking Out

Source: RSR Research, February 2015

Unfortunately, as we’ve discussed since our company’s inception, it just doesn’t work this way. While technology plays a vital role in pushing the industry’s ability to, in this case, merchandise better, all the speed and technical capability in the world won’t help a retailer whose internal processes are not in place. For this reason, it is worth nothing how differently Retail Winners perceive their roadblocks:

• For starters, Retailer Winners are much less likely to report that their existing technology infrastructure is preventing them from moving forward (24% of Winners cite this is a top inhibitor, compared to 39% of all other retailers). This is a prime indicator of how Winners view the world. One, they have likely made greater inroads in shedding legacy systems that won’t work and play well with a new generation of merchandising tools. But more important, even when they haven’t, they are less likely to blame the technology for their problems. They continue to accept accountability for their own situations, something laggards rarely do.
• Winners understand that their perpetual inventory systems aren’t yet ready for new tasks (31% vs. 19% of all others). This is a specific component that they know – full well – is the cornerstone to understanding exactly what is going on throughout the entire demand chain. They aren’t saying “Technology come save us, ” but rather, “We know what we don’t know. “
• Interestingly, no real difference exists between Winners and their peers in trusting the pricing, inventory, customer or POS data that they currently receive. Everyone is in the same boat here.

The full report, Modern Merchandising: Managing Complexity with New Tools and Techniques, examines note only the challenges retailers currently face, but far more importantly, the ways they think they’ll remedy these issues. We invite you all to read the full report here.