Over the past 50 years, traditional retail has gradually been displaced by modern self-service stores, wide sourcing, long supply chains and the benefits of scale. The 1990s witnessed the arrival of disruptors, especially web-enabled digital players that provided a choice beyond stores, initially for lower frequency, high value purchases.
While retailers from the preceding generations remain and even prosper, the future will increasingly feature real-time connectivity of shoppers who get what they need, where and when they want it. Platforms, networks and the use of data will be vital, responding to and shaping customer expectations.
To borrow from biology, think of retailing as an ecosystem, a community of living organisms interacting as a system and featuring properties of self-organisation, scalability and sustainability. The retail ecosystem features many elements:
the consumer, retailers, supply chain participants, manufacturers and data providers. The successful retailer identifies an optimal combination of these elements for a unique customer value proposition.
But the retailer has to continuously recalibrate and adapt to retain customers in a competitive landscape. Connecting consumers to transactions, integrating data into the ecosystem and connecting online will feature prominently in this fight for sustainable advantage.
Connecting consumers to transactions, integrating data into the ecosystem and connecting online will feature prominently.
Stephan DuCharme,Managing Partner L1 Retail
Deployment of human resources will be a key factor of success. Can the shopkeeper who managed a store become an empowered player within the ecosystem? Can the shopkeeper, who instinctively feels the customer and the store shelf, coexist with a customer who knows all? Can suppliers become partners? Retail ecosystems will become increasingly large, but their managers and stewards will need to keep them lean, in constant listening mode and responsive to customer needs.
This is the next generation of retailing. L1 Retail aims to build 21st-century retail stars. We will do so by identifying, investing in and supporting strongly differentiated, customer-centric value propositions with strong, motivated management teams that align around a long-term vision for sustainable growth.