Trends are now much harder to predict. Retailers used to be able to pin most spikes in sales for products to the time of year, like whether it was the summer or the lead up to Christmas. However, social media and the online world has changed this, now dictating the latest products people want, meaning new trends can arise at any time.
Throughout the pandemic in 2020, trends influenced online were even more prevalent. Much of the UK was swept up in a home workout craze, with thousands of gyms and leisure centres closed. Spurred on by online fitness influencers offering free, live and interactive workout sessions like Joe Wicks, the UK public began snapping up home gym equipment leading to a 5,800 per cent spike in sales. The NHS Couch to 5km app also saw more than 858,000 downloads between March and June alone.
Influencers are now behind many of the trends we see and retailers need to be able to plan as best they can. But how can you plan for the unpredictable? Finance teams may just hold the answer.
The new online consumer
Technology has had a huge impact on us all in the last year. Yet many retailers are having to play catch-up fast to ensure they have the right solutions in place to meet customer demand, particularly since the pandemic has driven the UK online. According to one McKinsey report, many businesses have had to accelerate their practices forward by almost half a decade - digitisation is a big part of this.
Within the retail sector, more than 85,000 businesses launched online stores or joined online marketplaces in Q3 of 2020 alone; as they continue to react to how consumers make the most of their purchases online - something which is likely to continue after ‘normality’ returns.
Customer expectations are changing, too. They want personalisation, easy ordering, and rapid delivery. Retailers need to be able to meet these demands and investing in technology to support teams across the business is vital.
In the finance department, accounting automation is changing how finance professionals are reporting and ultimately analysing data to better forecast future business performance. And according to a survey we carried out in December 2020, automation software is in the top three types of tech finance professionals expect to adopt in 2021.
Automating reports to increase financial data
There are an abundance of benefits that come with accounting automation – from all-important time-saving and productivity, to data accuracy, cash flow stability and strategic insight.
Nobody would deny the fundamental role that finance teams have always played in business, but the extent of their importance today, has changed dramatically in the last 12 months. So much so, in a survey conducted by the Access Group, almost 65% of finance professionals agreed that the pandemic and remote working had led to permanent changes in their day-to-day responsibilities.
This is because there is now an even greater need for finance teams to focus on providing value-adding insights to help drive the business towards recovery; seizing on any opportunities to increase sales, highlighting less profitable strategies or identifying underperforming products.
Gone are the days where finance teams simply deal with day-to-day activities like tracking invoices and paying suppliers. Today, their advice and commercial input could be the difference between success or failure.
With investment in technology now a focus for many companies to make repetitive and time-draining systems a thing of the past, finance teams are able to spend more time putting plans in place to support the future of the business and highlight new streams of revenue to increase margins - for example, drilling down on the available data and identifying areas where costs can be reduced, processes streamlined or even areas for business expansion like products proving popular with influencers or online markets yet to be uncovered.
What any business owner wants right now is certainty. Finance teams can at least help to give retail leaders some idea of what’s to come through detailed reporting, but without the right tools, it can become guesswork - which may leave the business with a ‘false’ strategy.
Using the real-time insights provided in automated reports, finance teams can break down the sales data using it to inform the other arms of the business so that they can ready the business’ operations to handle any surge in sales – from providing foresight on inventory levels, to delivery output. Finance teams can then focus on spend management and forecast what impact the surge may have on the business’ bottom line.
It is also worth noting, without a positive cash flow, retailers will not be able to capitalise on trends or areas for growth - or, at least, not in a timely manner that allows them to take advantage of the online rush.
While you might not be able to predict the future or pin down exactly what the next trend may be, you can certainly plan for it. After all, success is underpinned by a clear strategy, and with the rise in ecommerce set to stay, it is vital businesses map out a plan for the future by harnessing forecasting and reporting tools, so the company can be prepared for what trends are to come.
Warwick Haycock, Accounting Software Specialist at The Access Group