Business Model Adaptation In Retail: A Growing Need

Date Added: Jul 2010
Format: PDF

Change in retail markets comes slowly and almost silently, so it is not always easy to gauge its impact. For example, on the demand side, the mass movement of women into the workforce has been responsible for a drop in store visits of as much as 35 percent in some countries and - with many of these women now shopping weekly instead of daily - a parallel 20 percent increase in the average ticket amount. But because this shift has taken place over a 25-year period, it has gone mostly unnoticed. On the supply side, regulatory barriers, real estate constraints, and economies of scale in purchasing and warehousing have given incumbents a strong advantage but also a false sense of security.