The great resignation brings workforce issues to the forefront

Even as recently as one year ago, the labor problems facing the industry today would have seemed unlikely, especially given where the economy was headed and how, at the time, workforce reductions were far more commonplace. With all the pandemic-related uncertainty, it seemed that no one would voluntarily leave a job without lining up something else first.

Many retailers are now in a tough spot—83% are investing most heavily in employee recruitment and retention. With executives noting that labor issues are top retail concerns, retailers should reset the way they think about their employees as they consider the future. The issues go far deeper than merely salaries. Priorities have shifted for employees, especially around flexibility, culture, and diversity, equity, and inclusion (DEI).

Overcoming persistent issues with the manufacture and movement of goods

True supply chain resiliency will likely require significant change across the board. Resets don’t happen overnight. But retailers can’t afford to wait given that 80% of executives we surveyed believe consumers will prioritize stock availability over retailer loyalty in the upcoming year.

Just as shifting priorities from the pandemic have changed employee expectations, they have also altered the way consumers shop. Where and when customers make their purchases are far less predictable these days. Many current supply chain capabilities—including demand planning, inventory management, and fulfillment forecasting—aren’t set up to handle such scenarios. Organizations need more credible information and technology upgrades to develop agile systems that can handle the new consumer scenarios.

The fusion of digital and physical experiences will only accelerate

Retailers should make significant investments that not only meet the e-commerce needs of the present, but also those of the future. A key takeaway from the pandemic has been that consumers have reset their level of reliance on technology and digital platforms.

Our survey respondents are mostly aligned on how they plan to invest in 2022 around e-commerce, digital marketing, and automated checkout. Over the next five years, leaders are buying into the prospects of digitization of the physical world, such as voice commerce, staff-free cashier-less stores, and the selling of digital goods.