As I sit here on Cyber Monday (amazingly, not shopping), I wanted to write a little about where I think the future of retail sales is heading. In today’s market, with so much of our lives intertwined with the digital world, can brick and mortar stores survive? Or are we destined to buy everything with a click of a mouse?

Here’s a quick synopsis: In the 90’s, as the Internet sprouted to life, making purchases online was a somewhat scary novelty.  By the 2000’s, the explosion of online retailers changed the way we bought stuff forever . Today, we are seeing the retailers struggle with the retail sales ETF, SPDR S&P Retail (XRT), down almost 6% over the last two years*. The 800 lb. gorilla is obviously Amazon, which continues to grow aggressively and expand into many different areas. Contrast this with the more traditional retailers such as JCPenney and Sears, which are closing stores and selling real estate.

In the past, many analysts and reporters have framed the conversation as an online v. brick and mortar, winner take all, battle to the death. Specifically, Amazon v. Walmart. Which one of these two would drive the other out of business and claim ultimate retail superiority? However, what we are seeing now is the necessity for both an online channel and a physical presence. And, while there has long been a general move towards online, we’re starting to see a clearer need for both.

Until recently, Walmart was seemingly paying lip service to an online channel with much of its focus on store pickup. However, with its purchase of jet.com last year, it has jumped head first into the Web, and embraced home delivery. Alternatively, this year, Amazon bought Whole Foods to instantly give it over 400 physical locations. Now, in addition to your online ordering, you may have a place to visit in physical form, test out products and return purchases.

One of the most interesting combinations for me was when Albertsons bought Plated (home delivered meal kits). I love the idea of meal kits: all the ingredients you need in just the right amounts, recipes and instructions on technique, and using ingredients you might not use every day. And, while I’m willing to pay $20 for one meal, I won’t pay $60 for three meals delivered on the same day because I know I will waste at least one of them. Now, in theory, without that “last mile” delivery expense, Plated could offer single kits you order online, for pick up at your local Albertsons. Online presence + physical location.

The retail landscape is definitely changing. And, where we ultimately end up may look entirely different from where we are now. The online channel of sales has never been as important as it is today. However, it’s important to note that as of the third quarter of this year, e-commerce makes up only 9.1% of total retail sales^. So, there are a lot of possibilities as our buying habits evolve. And, we are just starting to see what the future may hold.

 

*https://finance.google.com/finance?q=NYSEARCA%3AXRT&ei=d2ccWpl1hNmMAemql9gL  ^https://www.census.gov/retail/mrts/www/data/pdf/ec_current.pdf

*Non-deposit investment products and services are offered through CUSO Financial Services, L.P. (“CFS”), a registered broker-dealer (Member FINRA/SIPC) and SEC Registered Investment Advisor. Products offered through CFS: are not NCUA/NCUSIF or otherwise federally insured, are not guarantees or obligations of the credit union, and may involve investment risk including possible loss of principal. Investment Representatives are registered through CFS. Verity Credit Union has contracted with CFS to make non-deposit investment products and services available to credit union members.

Gavin Chinn, CFS* Financial Advisor

Check the background of this investment professional on FINRA’s BrokerCheck.

An Investment Advisor registered through CUSO Financial Services, L.P., Gavin has 22 years of experience as an advisor in the Puget Sound area.

“I believe every client is unique and deserving of a personalized financial plan that will help them reach their individual financial goals. Before I make any recommendations, I like to get to know my clients. By asking the right questions, and developing an honest, trusting relationship I can really get a sense of what’s going to work best for them.”

Gavin graduated from the University of Washington with a BA in Business Administration and started his financial career with US Bank in the Investment Department. Prior to joining Verity in 2006, he spent eight years with Piper Jaffray.

So what is Gavin’s vision for his dream retirement?

“My dream retirement would be absolutely worry free: financially, emotionally, and in every aspect of life. My finances would be in order so expenses for travel, luxuries, and gifts for the kids, grandkids, and great-grandkids would be taken care of. My kids would be financially sound, so I would be confident in their prosperity. This would give me the freedom to travel and play and do whatever it is I want to do.”

When Gavin’s not working, he enjoys spending time with friends and family, watching Husky football, and taking weekend trips around the Northwest.

Gavin is registered to transact securities business in the states of WA, OR, CA, AZ, FL, HI, ID, IL, MN, NM, NY and VA.

*Non-deposit investment products and services are offered through CUSO Financial Services, L.P. (“CFS”), a registered broker-dealer (Member FINRA/SIPC) and SEC Registered Investment Advisor. Products offered through CFS: are not NCUA/NCUSIF or otherwise federally insured, are not guarantees or obligations of the credit union, and may involve investment risk including possible loss of principal. Investment Representatives are registered through CFS. Verity Credit Union has contracted with CFS to make non-deposit investment products and services available to credit union members.

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