Last week I received a newsletter from the US, titled 'The Fall of American Retail'.

What got my attention were the numbers of store closures over the past six months; J C Penny (138), Radio Shack (552), Payless Shoes (400), Macy's (68), Sears and K Mart (150), and several others I hadn't heard of, about 180 stores.  Since the end of October 2016 more than 89,000 retail workers have been laid off.  (I had also read 'Walmart' planned to close nearly half their stores).

The writer says the cause is obvious – competitive pressures brought on by the advantages of e-commerce, convenience and customization.  I agree that the 'bricks and mortar' business model is under attack, but you also have to look at other examples of business disruption too.

Amazon has pretty well destroyed book shops (remember Borders?), you can download music so goodbye local record shops, and Uber destroyed the taxi industry.  Digital self-selling entities like Purplebricks and BuyMyHouse offer a way to sell property for a fee at a fraction of a real estate agent's commission.  The property management sector is under attack too, Rentberry is starting in Australia.

It's possible to argue none of these are as good as the old way, and agent service is important but a growing proportion of consumers clearly will exchange service for price.  These digital alternatives are returning power in the transaction to the buyer.

Now, more than even before, businesses must find a unique point of difference in a competitive market.  Previously, the POD was built around amazing customer service, or fantastic product knowledge, or aggressive pricing, or leverage through social media.

Obviously these are all relevant, and many consumers will respond to an increased level of service and creativity that will demonstrate the suppliers value in achieving stronger results for the vendor.  Of course, not all agents will bother and write off self-selling entities as a passing fad.  Ask a taxi driver if it is a fad, one who just saw $500,000 for a taxi plate wiped off his investment.  What it will do to the value of rent rolls?

The lesson in this, whether retail or service industry, means paying attention to these factors:

- Avoidance of high-cost structures, which makes it difficult to complete with leaner, more efficient, or better capitalized competitors.  Look at your costs, now!  (Cost of goods, wages and productivity, and expenses).

- Don't expect your brand or reputation to save you.  Yes, these are helpful in an internet research world, but brands can quickly become irrelevant and reputations can fall apart too (eg., United Airlines).

- Examination of the current business model because it will likely not last forever.

If there is good news in this technological onslaught it may be that it is possible to align with this progress (or, choose your own word) and to adapt with a new and better business model.  Not every customer will just want the lowest price, but they will if you are not providing service and relevant value.