A Changing Retail Landscape
E-COMMERCE AS A PERCENT OF TOTAL RETAIL SALES (2016)*
||INSIGHT: Fears of technological progress leading to technological unemployment have proven unfounded. In fact, automation has had little effect on overall employment but has made workers more productive and increased their wages.|
||INSIGHT: Mass customization, reduced inventory and production efficiencies will contribute to deflationary pressures.|
||INSIGHT: Retailers are shifting to smaller footprints with less inventory and more emphasis on stores as hubs for brand and service experiences.|
||INSIGHT: It is going to become increasingly difficult for traditional brick-and-mortar retailers to compete.|
||INSIGHT: Changing consumer expectations force supply chain models to become faster and more efficient. Last-mile distribution centers located close to the end consumer will result in faster fulfillment at lower costs.|
- Invest in a small urban industrial REIT believing this property type is limited, the sector is fragmented and the market is not fully valuing scarcity, proximity and future demand for small urban warehouse space.
- Invest in a market leader in robotics, an early adopter of artificial intelligence and leading manufacturer of collaborative robots that work side by side with humans.
- Invest in the market leading producer of Radio Frequency Identification tags which are increasingly being attached to clothing, food items and healthcare supplies. New applications across industries will allow electronically stored information to be read and tracked to monitor manufacturing, transportation and sales.
Studying the secular development of a trend like the changing retail supply chain leads to seemingly unrelated but connected investment opportunities across different industries and sectors.