The IHL Group is reporting in its new research, Retailers and the Ghost Economy: $1.75 Trillion Reasons to be Afraid, that deficiencies in the retail market cost $1.75 trillion a year. Overstocks, out-of stocks and needless returns are the primary siphons on the $14.5-trillion retail economy worldwide.
The worldwide annual losses in these three categories are:
- Preventable Returns: $642.6 billion
- Out-of-stocks: $634.1 billion
- And overstocks: $471.9 billion
"Retailers all too often focus on a variety of ways to drive revenue and increase comparable year-over-year sales, but retailers can realize huge gains by addressing opportunities that are in hand and slipping through enterprise fingers," Greg Buzek, president of IHL Group. "These problems are within retailers' grasp to solve, but it requires more than data, more than business intelligence. It requires understanding the root causes of inventory and data disconnects and implementing the technology solutions and operational changes to address these revenue-limiting issues."
JustEnough has been focused for two decades on helping leading retailers to reduce the causes of these preventable losses. Our demand-driven retail planning solutions make it simple to plan better assortments, allocate products to the optimal stores, plan pricing and markdown strategies, maximize space-selling effectiveness and replenish inventory with accuracy. The result is the ultimate wish for any retailer – increased sales, fewer stock-outs, reduced markdowns and inventory costs and happier customers.
You can download your free copy of the IHL report here.