As retail sales take a plunge during the cost of living crisis, retailers will be wary of the similar impact that the pandemic had on consumers as they pivoted to purchasing mostly essentials. If retailers have kept data from this period, they’ll be better prepared to update or change forecasts to meet financial objectives as the situation changes.

As the current issue primarily revolves around the demand for luxury/non-essential goods, planning at the category, sub-category or even brand level can enable retailers to prepare for those potential sales dips. Additionally, they can also gain visibility of how the crisis might impact purchases for essential goods, which may spike up and down depending on discount periods. This can all be made possible by incorporating technology to help improve forecast accuracy, manage inventory and limit stockouts.

Alongside gathering these insights, retailers will need to take some practical steps to be more strategic in their promotions. This may mean shifting to more frequent promotions at a lower discount to send the message to customers that they are providers of value. Alternatively, another key strategy could be pricing slightly lower than the competition on a handful of key items. For example, toilet paper and milk are two essentials that consumers frequently base a retailer’s perceived value on, so getting these prices right may be the difference between winning customers and losing footfall.