Today, we can determine near-true demand using item-level RFID tagging with significantly greater accuracy and in a fraction of the time then when ma Kettle told pa Kettle “Pa, go and count them widgets” in the general store at the end of the year. We now have software that analyzes price elasticity of merchandise so that we can even forecast demand by price point (wow!). We have been trying forever to understand and react to ‘demand’ as it differs from one store location to another. It’s only lately that – with the aid of technology – we’ve been able to hone those skills, such as store clustering, and store planning; and that we are more rapidly approaching a way to deal with the awesome fact that, almost by definition, every store – and therefore every demand – is different. We have developed software and Internet-based exchanges that enable trading partners (I like that expression) to be more responsive and fleet of foot in responding to customer demand along the supply chain.

All this reminds us that retail has always been ‘demand driven.’ Regardless of how some would disguise it to sell you more services or products, the basic principles of retailing have never changed. Had Henry Ford gotten his way, and sold his cars “in any color you want, as long as it’s black”, he would have been out of business soon too. The people demanded colors.

The challenge is to be able to manufacture and ship to the selling floor, those products for which there is real demand, and in ever shrinking production cycles so that the industry can react to the demand before the season is over. That, my dear retailers, is the trick!