3 minute read
John Ryan
Time
to change is now
With the cost of living crisis and dire financial forecast ahead, you may be tempted to keep your business as it is, but John Ryan reckons this is exactly the time to up your game…
The rot continues. Walk down any high street in the UK currently and there are numerous empty units. The costof-living crisis, the pandemic or just poor retailing; all are in some measure to blame for this, and it’s not going to stop.
That said, there is an upside. Alongside all the retail desertification there’s a significant number of oases. Practically, this means that the big chains are busy closing stores that don’t offer any kind of ROI and this makes sense. After all, why would you open a store or continue trading from a poor site if you didn’t have to? The days of relentless expansion appear to be, for the time being at least, a thing of the past. Today the focus is on retail estates comprising fewer stores, but they are generally better.
The reason for this is straightforward. Using the 80/20 rule, providing the stores that remain really do offer a net contribution to the bottom line, then fewer shops means increased profitability. And if there is any doubt about whether this is happening, it’s worth taking a look at both the store design and fit-out sectors. Both are currently very busy as retailers scramble to raise their game and give shoppers reasons to cross their thresholds.
The other point about what the chains are doing is that by investing in existing stores, they force the smaller operators to do likewise - and this is rather the point. If it’s a while since you’ve done anything to your store, now might be a good moment to take stock and act. There are, of course, any number of reasons why you should do nothing with money - battening down the hatches and being quite happy to continue as you are, being among them.
Well, perhaps. But consider this. Project yourself a couple of years into the future. The chains have done their thing and their branches are now far more attractive than they were. The indies have followed suit, while maintaining that which sets them apart. And you? Well, things are as they have always been. You will probably have noticed, however, that stores that you once might not have viewed as competition are now being given a second glance.
Reading the runes and working out when is the right time to refurb a store is never easy, but when there are threats all around, it might be the moment to do something, rather than crawling into a commercial cave. This may go some way towards explaining why even at the more value-led end of the market businesses such as Card Factory are trialling new layouts and equipment, in a bid to maintain or dare I say it, increase their share of what many see as a shrinking high street spend.
Giving a store a makeover is never a cheap or easy thing to do, but letting the grass grow under your feet really isn’t an option. Yet whether it’s a matter of a fresh coat of paint, a change of in-store materials or some kind of in-store installation that will get ‘em walking through the doors, there is much that can be done without the bank sending you a warning email/letter.
The other question is whether it will all be worth it - and here the answer is more obvious. Do nothing and watch your business gradually heading to the point where not only are you an also-ran, but ultimately at a point where throwing down the shutters for a final time may not be that far away.
Christmas and all that it means is still some way off and if by then you’ve done nothing, then dimming the lights could be on the cards (as it were).
John Ryan is Stores Editor of Retail Week, a position he has held for more than two decades, and managing director of Newstores, a daily information service on what’s new in retail across the world. @newstores | www.newstores.co.uk | 07710 429926
