Erik Bergeman

Retail Consultant
BS in Electrical Engineering from Texas A&M University; MS in Systems Engineering from Southern Methodist University; 10 years at Electronic Data Systems; 21 years at IBM focused on the Retail Industry and Industry Solutions for most of those 30+ years
  • Posted on: 02/04/2020

    Is Forever 21 a wise investment for its new mall landlord owners?

    Here's a thought. Rather than close the stores, maybe they are in a good spot do what Mansell did at Kohl's. Remodel and lease out square footage to adjacent businesses. Gets you to a smaller format, can increase foot traffic, and the new owners execute on something they have core skills in.
  • Posted on: 02/04/2020

    Is Forever 21 a wise investment for its new mall landlord owners?

    Even if as the name implies their target customer is a female 15 to 25, the reality is that size XS represents only about 5 percent of that target customer segment. Merchandising and operations need to fix the basics. As you say Cathy, they can have the most awesome styles but if they miss the right size and fit they will continue to fail.
  • Posted on: 02/04/2020

    Is Forever 21 a wise investment for its new mall landlord owners?

    Here is what I find most interesting regarding the private equity plays that have killed many iconic retail organizations over the last 10 years. The malls have a seriously vested interest in keeping the stores open. What I don't think most private equity companies get is that when you close a store in a market area not only do you lose the store revenue but you lose the associated e-commerce revenue in that market. There is a proven symbiotic relationship between stores and e-commerce that we are now beginning to understand more clearly. Just take a look at Sears' e-commerce business.
  • Posted on: 11/04/2019

    Should McDonald’s CEO have been fired over a ‘consensual relationship’?

    I agree with Nikki. It is not that employees should not have consensual relationships. It is about avoiding situations where there is potential for abuse of power. That is the very definition of sexual harassment. Does a person who works for you genuinely have the ability to consent? Do leaders need to be held to a higher standard? You can not stop two people who work together from forming a potentially romantic relationship. You can however, expect leaders to not put their direct employees in a compromising situation. With great leadership and power comes great responsibility. It was not very responsible of Mr. Easterbrook to allow that to happen for a great many reasons. He could have made many other choices that would not have compromised him or the company.
  • Posted on: 10/19/2019

    Is BOPIS a good fit for Dollar General?

    Ignore customer expectations at your own peril. Table stakes for sure. Something essential for any retailer operating in these times. Of all the possible operational challenges for BOPIS, DG’s biggest in my opinion is inventory accuracy. If anything like most other retailers the customer backlash for not having in that store what the customer orders will be swift and vicious.
  • Posted on: 06/24/2019

    Where are the pain points for suppliers engaged in drop shipping?

    Most interesting comment is: "On the positive side, the majority of suppliers said drop shipping has led to improved sales, market share and profitability." Just goes to show you that the increased logistics cost for DTC is overshadowed by manufacturing operations cost. More sales means more profits for the suppliers.
  • Posted on: 05/09/2019

    H&M sells supply chain transparency

    The world has changed. The Millennials and Gen Z shoppers, arguably the most sought after segments for new customers by H&M, care about this. Good for them and I think transparency will become the next big disruption in this crazy wonderful industry.
  • Posted on: 04/19/2019

    Is AI’s impact on demand forecasting more hype than reality?

    Like almost everything in life, I think it important to note that one size does not fit all. Different categories require in many cases completely different approaches, even with AI. Long lifecycle products can combine historical sales peaks and valleys with causal factors that can be predicted with a high degree of accuracy. Short lifecycle products need a deeper look at outside information like weather, fashion trends and social buzz. This is especially true of using AI/Natural Language Understanding to look at outside factors that we have not looked at in the past. AI in all its different form factors is proven to improve forecasting by a factor of 10 over what we were able to achieve in the previous 10 years before AI. The longer we wait the further behind we will get from those that are doing it.
  • Posted on: 04/04/2019

    Are third parties the biggest reason delivery costs keep going up?

    I saw a study by Alix partners on margin in apparel. DTC costs a brick and mortar retailer 8% - 10% more than selling the same item in a store.
  • Posted on: 02/25/2019

    What’s holding back end-to-end inventory visibility?

    What I find especially interesting is the chasm of disconnect between the "leaders" in a retailer omnichannel organization and the "leaders" in a retailer supply chain organization. Let's take for instance department stores. Does anybody really believe other than Macy's who has made the investment in selling to the last item with RFID, that a department store actually has a better than 65 percent accuracy rate down to the color/size level in a store? Even though there have been many studies that prove the ROI they can't seam to get over their institutional inertia. When will they realize that they can no longer compete spending 1.5 percent of revenue on IT? #crisisofleadership
  • Posted on: 02/07/2019

    Are legacy retailers on the right track or heading off the tracks?

    I see two super large impediments to making the changes necessary to survive. Digitization (of everything from the store experience to the supply chain) is ground stakes for even being able to make the change much less willing. To do that both the CFO and Wall Street have to shift views from a predominantly CapEx model to an OpEx model. Amazon spends 10 times the average legacy retailer on digitization using an OpEx model (through AWS). The second big challenge is around a change of attitude at the top. Years ago Blockbuster had reached an agreement in principal to acquire Netflix for $100 million. The top leadership at the company pulled the plug because they were retailers (i.e. store guys). Customers don't care. Until legacy retailers pivot from a product-centric worldview to a customer-centric service and experience worldview they won't make the right financial and operational decisions to keep up with customers.
  • Posted on: 01/08/2019

    What’s holding back in-store mobile engagement?

    Customers are looking for better engagement period. The fact that a mobile device is part of that engagement is less relevant than the customer having the feeling that their mission is understood. Think about a grocery store that doesn’t make you clip coupons but when there is one for your favorite products in your cart it gets applied automatically creating undying loyalty. How about you understand my mission based on digital exhaust and help me do it faster and cheaper than anybody else.
  • Posted on: 09/12/2018

    Gap CEO says retailers not turning in-store data into action

    I couldn't agree more with the sentiment. I think there are three legs to this stool. First the retailer must collect, enhance and improve their customer data to generate insight. In other words, they need to create a sustainable pipeline of insight. The second leg is they have to fix their inventory problem. To take advantage of the data from the store they have to have in-store inventory accuracy that is approaching 100 percent and real-time or near real-time. Then they have to make that inventory visible at digital/internet speeds. The third leg of the stool is to put the customer and inventory insight in the hands of both customers and associates through digital means. The result, mid-single digit same-store comps and a five point improvement in NPS.
  • Posted on: 01/09/2018

    Kohl’s is on a roll coming off the holidays

    I think Kohl's focus on becoming the best omnichannel department store is paying real dividends. Yes the apparel market macro spend came back but the scale of their improvement far outpaces their competitors. Fully executing the omnichannel use cases and enabling customers to shop, buy and fulfill from anywhere. Replacing their POS with a fully omnichannel enabled POS. Creating a digital wallet where members can checkout in the store and apply digital coupons, Kohl's Cash and Kohl's Credit with a single scan. Optimizing fulfillment decisions with AI/ML using e-fullfillment centers, retail distribution centers and stores. None of this is new or earth shattering, Kohl's has just done it at a level of effort and spend that no other department store or discounter has. That makes a difference.
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