Amid market volatility, labor pressures, and supply chain constraints, how can retailers sustain the resiliency of the last few years to better navigate the current headwinds? Our 2023 industry outlook explores retail trends to help your company elevate its business strategy beyond traditional cost-cutting. Learn how your organization can help drive future profitability by ensuring the consumer experience is at the heart of investments.
Change can be good, but constant change can be daunting. Retailers today are feeling the hangover of such volatility occurring in the most condensed time frame of any recent business cycle. As we head into the new year, only one-third of retail executives are very confident about maintaining or improving profit margins in what are expected to be turbulent times.1 Almost all retail executives expect inflation to pressure their profit margins. They’re also predicting hard times for consumers, with nearly all anticipating diminished consumption in 2023, resulting from rising financial concerns.
But the retail outlook is not all gloom and doom; retailers have learned much about resiliency in the past few years. Massive demand fluctuations during the pandemic forced retailers to rethink archaic systems in favor of more pliable operations. They learned that rapidly evolving consumer preferences require more effective analytics and tools to build loyalty.
To check the pulse of retail executives, we asked 50 leaders about their expectations regarding challenges and opportunities in the upcoming year. We wanted to better understand what traits separate leaders from the rest of the pack and to analyze planned strategies and investments for 2023. The results provide a unique outlook on how today's market, future expectations, and changing consumer needs inform strategies for the year ahead—and beyond.
To learn more about the emerging retail industry trends, explore them below. For an even deeper dive, download the full report.
The confluence of obstacles retailers face can make the next steps daunting. As such, we believe there are three key areas that retailers can—and should—address now to create efficiencies while addressing the changing consumer: last-mile capabilities, reverse logistics, and social commerce.
This survey was commissioned by Deloitte and conducted online by an independent research company from October 21 to 31, 2022. It polled a sample of 50 retail industry executives, of which 70% were from companies with annual revenues of $10 billion or more. The respondents included C-suite and senior executives who were directly responsible or exerted significant influence on major strategic initiatives in their organizations.
A note from Deloitte US Economists Danny Bachman and Akrur Barua
Three key economic trends will likely influence retail sales:5
1This survey was commissioned by Deloitte and conducted online by an independent research company from October 21 to October 31, 2022. It polled a sample of 50 retail industry executives, of which 70% were from companies with annual revenues of $10 billion or more. The respondents included C-suite and senior executives who were directly responsible or exerted significant influence on major strategic initiatives in their organizations.2Walmart Inc., “From ground-breaking to breaking ground: Walmart begins to scale market fulfillment centers,” January 27, 2021.3Shelley E. Kohan, “Happy Returns locations expand to over 5,000 with Ulta Beauty return bars,” Forbes, March 28, 2022.4Deloitte, “Holiday retail trends show spending is alive and well,” accessed November 25, 2022.5Retail sales exclude sales at automobile and parts dealers and gasoline stations but include sales at food services and drinking places.6All data is from United States government agencies. Unless stated otherwise, all data is sourced through Haver Analytics.7Daniel Bachman, “United States Economic Forecasts: Q4 2022,” Deloitte Insights, December 2022.8Bureau of Labor Statistics, “Establishment Survey,” sourced through Haver Analytics, accessed November 2022.9Consumer spending in this section refers to real spending and not nominal unless mentioned otherwise.