Wednesday, October 24, 2012

Adapting to multi-channel - Steps European retailers are taking.

Some UK food retailers are beginning to focus on using the shift to multi-channel retailing as an opportunity to grow sales while reducing the capital intensity of their business. 

Over the last four or five years, these retailers have selling capacity (i.e. square feet of selling area) at a rate of 4% or 5% percent per year, while demand hasn’t grown much; the result has been an dilution of sales densities. 

The situation is unsustainable, and the challenge is further complicated because grocery is such a capital-intensive business, and one that generates only modest returns.

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