I am sorry to have to report that those upon whom we rely on much of our news and information seem to have developed a process by which they inform us of 'facts' that are nothing more than speculation.
For example, Retail Week is reporting that a dip in the 'retail sales' in the past week or so was due to pre-election jitters. It is possible that the election was a factor, but to what extent and in what way that effect was felt would need to be researched thoroughly to determine anything approaching a precise conclusion. What would be easier would be for the journalists concerned to read the work of their colleagues - for instance the 'ash cloud', the outpourings of the volcanic eruption in Iceland is stubbornly refusing to abate and in the Retail Week it is reported that a 16% fall in international trade through the airports can be directly attributable to this natural occurence.
I have absolutely no idea what percentage of the whole of the UK retail trade is made up of airport shopping, but my guess is that it is a factor and we must remember that the context of the 'dip' is only 0.2% against the previous figure. It must be remembered also that these figures being reported are about the month of April - a notoriously difficult month to make comparisons with on a year to year or a month on month basis - the Christian calendars make sure of that! The date of Easter, being a truly movable feast, ensures a marked inconsistency in results every year! In fairness to Retail Week, they do mention that Easter came early this year, but have they considered providing a measure that truly encompasses the entire Easter period (by that I mean the period in which Easter falls in every year in the Western church calendars, probably taking in all of March and April together!)
Another factor is the weather - this is the UK and what we can rely on in March to May is unreliable weather patterns. This has nothing to do with climate change, although it too may be making its mark steadily, incrementally, year on year, but at this time of year with the days getting longer and the ground being warmed for longer, but with the danger that slow moving high pressure weather systems in the North Atlantic will bring winds across the still cold northern land masses of Scandinavia and the ice fields of the Arctic; the weather is inevitably going to act in the most irritatingly changeable manner at the most inconvenient of times. This too will affect retail sales - especially if all the goods from the new Spring collections are pushed to the fore and the weather suggests that snow boots would be good.
Then there is the 'sales' - the effect upon the general High Street sales performance is inflated or deflated by the proportion of outlets with 'sales' in progress. Journalists are wont to cite exceptional sales figures in the midst of a traditional 'sales' period, so why is there a reluctance to report when the opposite may be true? Is it because they really have bought in to the nonsensical belief that if you mention key words then magically they become true - omitting in consequence the mention of: recession, depression and others that describe a perfectly ordinary state for a particular part of any economic cycle. This was not a flippant statement, we were told in the early stages of the recent recession by leading BRC members that we must not talk ourselves into that recession - as if retailing was the core economic activity on a global scale that dictated these things and that there was actually something that retailers could do to prevent the myriad problems in the global economy.
The point is that these 'factual' statements about the retail sales are probably based on limited sources - i.e. BRC members and other larger groups whose EPOS systems facilitate data analysis but excludes SME retailers whose turnover experience may well be at odds with their larger neighbours. These statements do not acknowledge the composite nature of economic determinants in a field as narrow as 'retail sales' and the underpinning evaluation of the figures appear to be based on a limited understanding of the nature of them. I suppose what I want to see is either a more realistic assessment, a health warning about the limitations of the data and synthesis or an altogether less grandstanding approach in what I have come to think of as sensationalist journalism.
Tuesday, 11 May 2010
Sunday, 9 May 2010
Expert advice
In these straitened times it is very possible that your skills as a retailer will be tested well beyond their normal range. It is not something that you should give yourself a bad time over, rather you should consider a review of your business with a view to making the best of the opportunities that will be confronting you and minimising the threats that will jus as assuredly be coming along.
Welbeck's advice is to make use of those funded opportunities that are available - speak to Business Link in your region or ask the local Chamber of Commerce about other agencies who might help. If you are lucky enough to obtain funding for your business review or your development idea, that you insist on a specialist retail adviser to help you - all too many advisers are generalist business advisers and the needs of the retailer are often too specialist to be dealt with by them, although they are really useful if you want generalist advice such as 'how to develop a business plan' or 'how to develop your IT skills'.
These times will present peculiar circumstances, specialist retailers with success in steering businesses through previous fiscally doubtful periods will probably have the skills that you need to bolster your own. Don't be embarrased about asking - no-one can be an expert in everything, and yet most SME (small to mediun sized enterprises) seem to believe that others will judge them harshly if they admit to not having a particular skill - nonsense, you just ask. It is those who do not ask that will probably not survive.
Welbeck's advice is to make use of those funded opportunities that are available - speak to Business Link in your region or ask the local Chamber of Commerce about other agencies who might help. If you are lucky enough to obtain funding for your business review or your development idea, that you insist on a specialist retail adviser to help you - all too many advisers are generalist business advisers and the needs of the retailer are often too specialist to be dealt with by them, although they are really useful if you want generalist advice such as 'how to develop a business plan' or 'how to develop your IT skills'.
These times will present peculiar circumstances, specialist retailers with success in steering businesses through previous fiscally doubtful periods will probably have the skills that you need to bolster your own. Don't be embarrased about asking - no-one can be an expert in everything, and yet most SME (small to mediun sized enterprises) seem to believe that others will judge them harshly if they admit to not having a particular skill - nonsense, you just ask. It is those who do not ask that will probably not survive.
The people have spoken
The election has been and gone, and the country still waits with bated breath about who will govern in this forthcoming Parliament. This blog has no interest in the partisan politics of the past few months but has a great interest in the state of the economy and about the nature of the threats and oportunities that face our small retail businesses in the UK.
It is to be hoped that the outcome of the 'behind closed doors' deliberations between parties will eventually result in a stable government and, a government that understands the pressures that are already applying themselves to small businesses.
The most important thing for SME (small to medium sized enterprise) retailers is to be positive in your marketing and cautious in your expenditure. The need to control costs is paramount for those that intend to survive the coming weeks, months and years. Welbeck is willing to buck the trend amongst commentators in the world of retailing and to be honest in the appraisal of the situation. There is no point in following the advice of ccertain prominent figures associated with the British Retail Consortium and accepting that to face reality is to talk oneself into a downturn - we have already been there for many months already and it will not ease by hiding from the facts. What is essential is to measure the impact that a protracted period of fiscal constraint is likely to have on your own business (you can bet that the BRC members are doing precisely that!)
Consider the effects on your customer base of the probable reduction in the number of public employees - if your business is reliant on a customer base in which public and civil servants are a major factor, then it is probable that your trunover may be affected unless you change what you do. Consider the effects of increased pressure on your supply chain, especially if it is reliant on the UK or other nations where the fiscal pressures are most pronounced. Will the suppliers be forced out of business, will their terms alter unfavourably towards your business - have you checked to see if your supply chain can be made to work better for your business? Consider the effects of any increases in taxation on your business - VAT, Income Tax and National Insurance, Corporation Tax and taxes on fuels and commodities such as alcohol.
It is possible that none of these will have any impact at all on your business, but it has to be admitted that that is extremely unlikely. It does not mean that we all need to panic and run for the hills; it does not mean that we need to give up now ( a tough period in your own business is better than an even longer period on diminishing state handouts!). What it all means is that we all need to be extremely conscious of carrying out practical risk assessments on our businesses.
Take a look at your processes are they cost effective and achieving what you need them to? Look too at your supply chain - it's amazing how often SME businesses fail to negotiate, or even to look beyond the suppliers that they have used for years - now is not the time to base buying decisions on so-called personal friendships; personal friendships are for personal life not for business life.
It is sensible to review all of the costs in your business to ensure that the investment that you have is being made to work most effectively - question and challenge every expenditure and keep a close eye on the cash flow. That is not to say that you will not sepnd, that would be inviting a business death by a thousand cuts - you must still invest; invest in marketing (but remember to measure the performance of your marketing activities so that you repeat only those that give a good return on that investment), any business that fails to communicate with its customers will simply ...fail! Invest in your staff - that does not mean pay rises all round and taking on extra staff, but it does mean ensuring that they are performing to the best of their abilities and achieving what your business needs them to do. The investment will come in well targeted training, in building upon the skillsets that individuals have and in rewarding improved perfomances - even if only with a very loud thanks!
Welbeck will be watching the state of the High Street with extra interest during this period.
It is to be hoped that the outcome of the 'behind closed doors' deliberations between parties will eventually result in a stable government and, a government that understands the pressures that are already applying themselves to small businesses.
The most important thing for SME (small to medium sized enterprise) retailers is to be positive in your marketing and cautious in your expenditure. The need to control costs is paramount for those that intend to survive the coming weeks, months and years. Welbeck is willing to buck the trend amongst commentators in the world of retailing and to be honest in the appraisal of the situation. There is no point in following the advice of ccertain prominent figures associated with the British Retail Consortium and accepting that to face reality is to talk oneself into a downturn - we have already been there for many months already and it will not ease by hiding from the facts. What is essential is to measure the impact that a protracted period of fiscal constraint is likely to have on your own business (you can bet that the BRC members are doing precisely that!)
Consider the effects on your customer base of the probable reduction in the number of public employees - if your business is reliant on a customer base in which public and civil servants are a major factor, then it is probable that your trunover may be affected unless you change what you do. Consider the effects of increased pressure on your supply chain, especially if it is reliant on the UK or other nations where the fiscal pressures are most pronounced. Will the suppliers be forced out of business, will their terms alter unfavourably towards your business - have you checked to see if your supply chain can be made to work better for your business? Consider the effects of any increases in taxation on your business - VAT, Income Tax and National Insurance, Corporation Tax and taxes on fuels and commodities such as alcohol.
It is possible that none of these will have any impact at all on your business, but it has to be admitted that that is extremely unlikely. It does not mean that we all need to panic and run for the hills; it does not mean that we need to give up now ( a tough period in your own business is better than an even longer period on diminishing state handouts!). What it all means is that we all need to be extremely conscious of carrying out practical risk assessments on our businesses.
Take a look at your processes are they cost effective and achieving what you need them to? Look too at your supply chain - it's amazing how often SME businesses fail to negotiate, or even to look beyond the suppliers that they have used for years - now is not the time to base buying decisions on so-called personal friendships; personal friendships are for personal life not for business life.
It is sensible to review all of the costs in your business to ensure that the investment that you have is being made to work most effectively - question and challenge every expenditure and keep a close eye on the cash flow. That is not to say that you will not sepnd, that would be inviting a business death by a thousand cuts - you must still invest; invest in marketing (but remember to measure the performance of your marketing activities so that you repeat only those that give a good return on that investment), any business that fails to communicate with its customers will simply ...fail! Invest in your staff - that does not mean pay rises all round and taking on extra staff, but it does mean ensuring that they are performing to the best of their abilities and achieving what your business needs them to do. The investment will come in well targeted training, in building upon the skillsets that individuals have and in rewarding improved perfomances - even if only with a very loud thanks!
Welbeck will be watching the state of the High Street with extra interest during this period.
Tuesday, 17 November 2009
Public Procurement and SMEs
Has the time come for a fundamental rethink in the realms of public procurement. I remember a time when small businesses were able to 'bid' for small projects and small supply tenders by representing themselves to the 'buyer'. There was a need to provide evidence of being able to provide value for money, but since, so very often, these small bidders were also local ratepayers there was an inbuilt sense of a need to provide value for money.
It would be naive to believe that simply because someone was local that they were above a bit of 'adding value' to the end accounts, but there were also local remedies and blocks to that happening. Now though, as with so many things in this post-neo-liberal, neo-hysterical world, there now has to be so much regulation that a completely new industry is being born. Doubtless the European Union will be blamed for this shift in attitudes and for the adoption of this new paradigm supposedly protecting public funds - but the British Government are quite likely to be the greatest of sinners in my opinion.
The whole shift seems to have been accelerated by the hysteria whipped up over the scandals of the Members of Parliaments' expenses and the even more scandalous underwriting of the British arms trade that has a full culture of over-runs, over-charging aimed at the curiously complacent British Government whose complimentary culture of over-spend and under-manage has left massive holes in the UK balance sheets. The press eventually begin to wake up to these facts and with customary self-righteous indignation splash near hysterical headlines across their front pages. The reaction by Government - simple; they make it next to impossible for any small business to make a successful bid to any sort of tender. They make the paperwork impenetrable and the hurdles too great for anyone who has not got a trading record dating back to the last century - even though many are well funded and have vast experience.
The latest wheeze though, is the icing on the cake. In the past few weeks I have been inundated by adverts - usually from the Government funded Businesss Links, offering me training courses on how to cope with the paperwork (which confirms the levels that are now in place!). These courses vary in price and location but the cheapest that I have seen is about £75. I wonder how many take up this amazing offer - I must also wonder why it should even be necessary!
It would be naive to believe that simply because someone was local that they were above a bit of 'adding value' to the end accounts, but there were also local remedies and blocks to that happening. Now though, as with so many things in this post-neo-liberal, neo-hysterical world, there now has to be so much regulation that a completely new industry is being born. Doubtless the European Union will be blamed for this shift in attitudes and for the adoption of this new paradigm supposedly protecting public funds - but the British Government are quite likely to be the greatest of sinners in my opinion.
The whole shift seems to have been accelerated by the hysteria whipped up over the scandals of the Members of Parliaments' expenses and the even more scandalous underwriting of the British arms trade that has a full culture of over-runs, over-charging aimed at the curiously complacent British Government whose complimentary culture of over-spend and under-manage has left massive holes in the UK balance sheets. The press eventually begin to wake up to these facts and with customary self-righteous indignation splash near hysterical headlines across their front pages. The reaction by Government - simple; they make it next to impossible for any small business to make a successful bid to any sort of tender. They make the paperwork impenetrable and the hurdles too great for anyone who has not got a trading record dating back to the last century - even though many are well funded and have vast experience.
The latest wheeze though, is the icing on the cake. In the past few weeks I have been inundated by adverts - usually from the Government funded Businesss Links, offering me training courses on how to cope with the paperwork (which confirms the levels that are now in place!). These courses vary in price and location but the cheapest that I have seen is about £75. I wonder how many take up this amazing offer - I must also wonder why it should even be necessary!
Tuesday, 10 November 2009
No taxation without representation!
It is good to hear that at least one MP has been on his feet in the house telling all that will listen that the current system of business rates is arcane and far beyond its useful life.
I am carrying out a study in a small market town for which an analysis of the rateable values was essential for a number of purposes. I noticed when reviwing the 2010 list that there were some anomalies and rang the Valuations Office Agency to try and discover a explanation.
The anomalies were simple. This is a very small town with one road acting as the primary shopping street with a traditional market place on one side and the remainder of the town's civic and other activities on the other. This shopping street goes through three name changes in the space of less than half a mile, and it is impossible to see, today, why the name changes were imposed at the points that they were. Let us call them Hill Road, Shopping Street and High Street.
Just off of Shopping street is the main pedestrian entrance to the markets and on the opposite side of the street is the most important secondary road which houses the civic offices, post office, the parish church and the cinema. We'll call this Cinema Road.
The busiest approach road into the centre of town is up Hill Road from the river valley below lying just north of the town. Through this valley runs a major trunk road linking two major conurbations. The Hill Road/Shopping Street/High Street route leads circuitously to another important town and Cinema Road leads to the nearest City, about twelve miles away.
The 2010 rates list shows that if your shop happens to be on Hill Road or Shopping Street then your rateable value is likely to have increased by 20%; if on High Street it is likely to have been increased by around 20% if in the first three or four shops closest to Shopping Street. Oher shops in the town have been increased by a staggering 0% - nil! Zilch!. I am quite sure that those retailers in the latter group are quite pleased but, why the level of difference. Why not an area where the average was around say, 10%?
The VOA oficer, with whom I spoke, told me that it was because the valuations of rentals in the area in 2008 were indicating these changes. I questionned him about the reasons that might have existed whereby a property might have had a rental increase of 20% over its immediate neighbour. He was insistent that this data was based upon rental returns and information supplied by landlords and tenants in the area, and that there would have been a factor pertaining in 2008 that would have affected these figures.
I have carried out a reasonably thorough investigation, talking to retailers, commercial agents and local estate agents, talking to the local council and looking through three or four years worth of council and newspaper reports and I can find nothing. There is no evidence that would support this kind of differential. A cynical person might opine that the VOA were guaranteeing themselves a job because of the number of appeals that this kind of differential would generate? Not that I would hold any such thought, but you can see where it might come from!
The fact that a system that is based on rentals; rentals that are themselves often artifically inflated by upward only rent reviews; and that these rentals are measured in a time of significant boom, only to have the resultant valuations implemented during a period that is dominated by a long and deep recession a couple of years later, is careless at best. This is an issue where the size of your business is not a determinant of your opinion about the system - retailers believe this to be an iniquitous system - members of parliament believe this to be an iniquitous system. Who is it, I wonder, that believes this to be a good system? The Chancellor I must presume, and the Prime Minister - but who else?
The time has come for root and branch reform. Let us question the validity of the basis of the valuation; let us question the concept of setting a universal business rate; let us investigate the formal relationships between business and government, at all levels, in terms of taxation and representation; most importantly, let us free up the system so that local needs are met by local decision-making, supported by regional strategies developed in concert between locally elected bodies. Whatever system is adopted it must be fair and equitable to all sizes of business and not with the current need to employ professional intermediaries to argue the case with a central government department - the current system has an in-built bias towards those businesses who can afford that professional input and is especially bad news for SME businesses who are consequently disadvantaged..
I am carrying out a study in a small market town for which an analysis of the rateable values was essential for a number of purposes. I noticed when reviwing the 2010 list that there were some anomalies and rang the Valuations Office Agency to try and discover a explanation.
The anomalies were simple. This is a very small town with one road acting as the primary shopping street with a traditional market place on one side and the remainder of the town's civic and other activities on the other. This shopping street goes through three name changes in the space of less than half a mile, and it is impossible to see, today, why the name changes were imposed at the points that they were. Let us call them Hill Road, Shopping Street and High Street.
Just off of Shopping street is the main pedestrian entrance to the markets and on the opposite side of the street is the most important secondary road which houses the civic offices, post office, the parish church and the cinema. We'll call this Cinema Road.
The busiest approach road into the centre of town is up Hill Road from the river valley below lying just north of the town. Through this valley runs a major trunk road linking two major conurbations. The Hill Road/Shopping Street/High Street route leads circuitously to another important town and Cinema Road leads to the nearest City, about twelve miles away.
The 2010 rates list shows that if your shop happens to be on Hill Road or Shopping Street then your rateable value is likely to have increased by 20%; if on High Street it is likely to have been increased by around 20% if in the first three or four shops closest to Shopping Street. Oher shops in the town have been increased by a staggering 0% - nil! Zilch!. I am quite sure that those retailers in the latter group are quite pleased but, why the level of difference. Why not an area where the average was around say, 10%?
The VOA oficer, with whom I spoke, told me that it was because the valuations of rentals in the area in 2008 were indicating these changes. I questionned him about the reasons that might have existed whereby a property might have had a rental increase of 20% over its immediate neighbour. He was insistent that this data was based upon rental returns and information supplied by landlords and tenants in the area, and that there would have been a factor pertaining in 2008 that would have affected these figures.
I have carried out a reasonably thorough investigation, talking to retailers, commercial agents and local estate agents, talking to the local council and looking through three or four years worth of council and newspaper reports and I can find nothing. There is no evidence that would support this kind of differential. A cynical person might opine that the VOA were guaranteeing themselves a job because of the number of appeals that this kind of differential would generate? Not that I would hold any such thought, but you can see where it might come from!
The fact that a system that is based on rentals; rentals that are themselves often artifically inflated by upward only rent reviews; and that these rentals are measured in a time of significant boom, only to have the resultant valuations implemented during a period that is dominated by a long and deep recession a couple of years later, is careless at best. This is an issue where the size of your business is not a determinant of your opinion about the system - retailers believe this to be an iniquitous system - members of parliament believe this to be an iniquitous system. Who is it, I wonder, that believes this to be a good system? The Chancellor I must presume, and the Prime Minister - but who else?
The time has come for root and branch reform. Let us question the validity of the basis of the valuation; let us question the concept of setting a universal business rate; let us investigate the formal relationships between business and government, at all levels, in terms of taxation and representation; most importantly, let us free up the system so that local needs are met by local decision-making, supported by regional strategies developed in concert between locally elected bodies. Whatever system is adopted it must be fair and equitable to all sizes of business and not with the current need to employ professional intermediaries to argue the case with a central government department - the current system has an in-built bias towards those businesses who can afford that professional input and is especially bad news for SME businesses who are consequently disadvantaged..
Friday, 23 October 2009
Customer Service
It has been a while since my last posting, mainly because, like everyone else at this time, I've been out there chasing ever less business opportunities. Which is why I was surprised to read in an article in the Retail Bulletin this morning about the number of businessses who have indicated in a survey that they intend to cut customer service training and also customer facing staff.
If there was ever evidence that the accountants rule, then this is it! It is easy to trim away at non-revenue bearing costs with an entirely clear conscience. But then it is also easy to claim to be a retail expert when things are good and it is a customer boom time. Then things start to go wrong; things begin to get harder and then... Well, in short the real experts come to the fore; they are the retailers who know how to get the best from their staff and who in turn are able to coax the best from their customers - money and goodwill! Retailing is a people activity, on both sides of the counter, notwithstanding the e-tail phenomenon which, incidentally, relies on many of the on-line customers being aware of products seen and demonstrated in-store.
How does customer service affect my sales and bottom line - well let me give you two examples of my own experience in the past week (I have written to the CEOs of both organisations!)
In one store of a large group I was approached by staff but then offered so much unnecessary advice that I felt harangued; the staff member concerned had even continued to pile benefit upon benefit and providing personal anecdotal examples of the benefits even when I had expressly told him that a buying decision had been made. To make matters infinitely worse, he was actually with other customers for the last onslaught of advice and cut across their enquiry in doing so. But the service of this store ought not to be judged by the one over-eager member of staff; so we'll get to the point where my wife and I had reached the check-out and were making purchases. My wife offered her debit card and it was not accepted; the cashier quietly explained that it had been declined but then, to judge by the gormless expression, apparently it was over to the customer. Not, as my staff would have done, ask if we had an alternative means of payment, so as not to lose the sale. It got worse!
Having made the purchase, we moved, as one does, out of the checkout area by moving towards the door on the windowside. The congestion of dump-bins and offers piled high was such that the route to the door was seriously restricted; but to cap it all the most obvious route was blocked by a 'supervisor'. When I commented that the exit was not clear she retorted that customers normally 'go the other way', which would entail re-entering into the main body of the store complete with carrier bags past a range of gondola ends and lots of easy targets for shop-lifters - completely ignoring the fact that it was also considerably further for the customer to travel. I challenged her by asking what would have happened had I been in a wheel-chair; her reply was terse, they too would need to go back. To achieve this the wheelchair user would literally have had to reverse (presumably past a waiting queue) and then change direction to make an exit. It got worse!
Two identical products that I purchased were faulty - something that would have made me, as a retailer, concerned immediately. When I returned the items on a following day the staff member who dealt with the query assured herself that they were faulty and then, she assured herself that I had in fact actually paid for the items. All of which is good practice and the staff member to be applauded. However, to be regarded as good customer service the staff member needed to engage with the customer, to smile occasionally, deal with the customer with good humour (especially when refusing something). Instead, in this case, I might not have existed, she was head down and was very soon completing the process for a refund. No offer of an alternative, no apology for the inconvenience, no engagement whatsoever. Then, as I was trying to engage her with a question and statement about the product, another member of staff, who had apparently been dealing with the cashier's previous customer with a specialist product, strode into view and immediately began talking about the previous customer and her query to the cashier who was supposed to be concentrating on me. This was bad enough, but the cashier, without any reference to my presence; without acknowledgement of the fact that I had been mid-sentence speaking to her; completely without thought, she responded to her colleague and turned her attention entirely over to a problem that had occured with their EPOS data and ticketing during the previous transaction. Eventually she turned to me and off-handedly asked me to sign a couple of slips and the transaction was over. It was a thoroughly bad experience and one which will influence my spend in that store in the future. I will add that whilst I have never rated the service in this chaain as great, the other local stores have never produced such a consistently poor showing over two successive visits.
By contrast I visited a 'local' branch of a major food chain and was really surprised by the attention to customers, which is in itself unusual in these convenience stores. I entered the store and began to look for inspiration for dinner along the aisle that was furthest from the checkout. I quickly made a decision and set about gathering the products that I wanted and started to make my way towards the checkout. I had been aware that staff were busily milling about, filling shelves and productively talking with each other. As I went along my aisle I was conscious of a member of their team quietly singing as she pushed a trolley with goods along the neighbouring parallel aisle to mine and in the same direction. As we were travelling at a similar speed it was not a surprise to find that we exited at the same time, but as I was turning towards her direction she immediately stopped, smiled, said "you go first sir" and let me through without a moments thought. This, I have to tell you, is one of my main criticisms of supermarkets trading through 24 hours - when the staff are filling they very seldom pay any real attention to the needs of the passing customer. Anyway, back to this 'local'; I went to the checkout and there was already a gentleman waiting with a newspaper to pay. I heard a comment of "oh sorry!" behind us and a member of staff rushed to the checkout, apologising as she went that she had not noticed us before - she had been shelf-filling. She immediately started serving the other man and simultaneously pushed the help button to summon another member of the team. This new team member appeared immediately also apologising for any delay as she went, even though the 'wait' was far less than I experience in the convenience stores that are slightly more local to me than this one.
She chatted amiably but was clearly focussed on her work, she was clear in her language and extremely friendly. I left that store feeling that if I have to use a 'local' then I would happily go there again. Strangely, there is a branch of the same 'local' about the same distance from me in another direction and there I have never felt any sense of pride in the work of the staff, nor much friendliness. I think one of the morals to be drawn from the experiences that I have outlined here, is that the mission statements and intentions of head offices and chief executives are not consistently met on the shop floor. This says clearly to me that now is the time to improve the customer relationship, to improve staff training and to stop looking at cost cutting based upon theoretical notions of good accountancy practice - cash flow is king and happy customers provide that cash!
If there was ever evidence that the accountants rule, then this is it! It is easy to trim away at non-revenue bearing costs with an entirely clear conscience. But then it is also easy to claim to be a retail expert when things are good and it is a customer boom time. Then things start to go wrong; things begin to get harder and then... Well, in short the real experts come to the fore; they are the retailers who know how to get the best from their staff and who in turn are able to coax the best from their customers - money and goodwill! Retailing is a people activity, on both sides of the counter, notwithstanding the e-tail phenomenon which, incidentally, relies on many of the on-line customers being aware of products seen and demonstrated in-store.
How does customer service affect my sales and bottom line - well let me give you two examples of my own experience in the past week (I have written to the CEOs of both organisations!)
In one store of a large group I was approached by staff but then offered so much unnecessary advice that I felt harangued; the staff member concerned had even continued to pile benefit upon benefit and providing personal anecdotal examples of the benefits even when I had expressly told him that a buying decision had been made. To make matters infinitely worse, he was actually with other customers for the last onslaught of advice and cut across their enquiry in doing so. But the service of this store ought not to be judged by the one over-eager member of staff; so we'll get to the point where my wife and I had reached the check-out and were making purchases. My wife offered her debit card and it was not accepted; the cashier quietly explained that it had been declined but then, to judge by the gormless expression, apparently it was over to the customer. Not, as my staff would have done, ask if we had an alternative means of payment, so as not to lose the sale. It got worse!
Having made the purchase, we moved, as one does, out of the checkout area by moving towards the door on the windowside. The congestion of dump-bins and offers piled high was such that the route to the door was seriously restricted; but to cap it all the most obvious route was blocked by a 'supervisor'. When I commented that the exit was not clear she retorted that customers normally 'go the other way', which would entail re-entering into the main body of the store complete with carrier bags past a range of gondola ends and lots of easy targets for shop-lifters - completely ignoring the fact that it was also considerably further for the customer to travel. I challenged her by asking what would have happened had I been in a wheel-chair; her reply was terse, they too would need to go back. To achieve this the wheelchair user would literally have had to reverse (presumably past a waiting queue) and then change direction to make an exit. It got worse!
Two identical products that I purchased were faulty - something that would have made me, as a retailer, concerned immediately. When I returned the items on a following day the staff member who dealt with the query assured herself that they were faulty and then, she assured herself that I had in fact actually paid for the items. All of which is good practice and the staff member to be applauded. However, to be regarded as good customer service the staff member needed to engage with the customer, to smile occasionally, deal with the customer with good humour (especially when refusing something). Instead, in this case, I might not have existed, she was head down and was very soon completing the process for a refund. No offer of an alternative, no apology for the inconvenience, no engagement whatsoever. Then, as I was trying to engage her with a question and statement about the product, another member of staff, who had apparently been dealing with the cashier's previous customer with a specialist product, strode into view and immediately began talking about the previous customer and her query to the cashier who was supposed to be concentrating on me. This was bad enough, but the cashier, without any reference to my presence; without acknowledgement of the fact that I had been mid-sentence speaking to her; completely without thought, she responded to her colleague and turned her attention entirely over to a problem that had occured with their EPOS data and ticketing during the previous transaction. Eventually she turned to me and off-handedly asked me to sign a couple of slips and the transaction was over. It was a thoroughly bad experience and one which will influence my spend in that store in the future. I will add that whilst I have never rated the service in this chaain as great, the other local stores have never produced such a consistently poor showing over two successive visits.
By contrast I visited a 'local' branch of a major food chain and was really surprised by the attention to customers, which is in itself unusual in these convenience stores. I entered the store and began to look for inspiration for dinner along the aisle that was furthest from the checkout. I quickly made a decision and set about gathering the products that I wanted and started to make my way towards the checkout. I had been aware that staff were busily milling about, filling shelves and productively talking with each other. As I went along my aisle I was conscious of a member of their team quietly singing as she pushed a trolley with goods along the neighbouring parallel aisle to mine and in the same direction. As we were travelling at a similar speed it was not a surprise to find that we exited at the same time, but as I was turning towards her direction she immediately stopped, smiled, said "you go first sir" and let me through without a moments thought. This, I have to tell you, is one of my main criticisms of supermarkets trading through 24 hours - when the staff are filling they very seldom pay any real attention to the needs of the passing customer. Anyway, back to this 'local'; I went to the checkout and there was already a gentleman waiting with a newspaper to pay. I heard a comment of "oh sorry!" behind us and a member of staff rushed to the checkout, apologising as she went that she had not noticed us before - she had been shelf-filling. She immediately started serving the other man and simultaneously pushed the help button to summon another member of the team. This new team member appeared immediately also apologising for any delay as she went, even though the 'wait' was far less than I experience in the convenience stores that are slightly more local to me than this one.
She chatted amiably but was clearly focussed on her work, she was clear in her language and extremely friendly. I left that store feeling that if I have to use a 'local' then I would happily go there again. Strangely, there is a branch of the same 'local' about the same distance from me in another direction and there I have never felt any sense of pride in the work of the staff, nor much friendliness. I think one of the morals to be drawn from the experiences that I have outlined here, is that the mission statements and intentions of head offices and chief executives are not consistently met on the shop floor. This says clearly to me that now is the time to improve the customer relationship, to improve staff training and to stop looking at cost cutting based upon theoretical notions of good accountancy practice - cash flow is king and happy customers provide that cash!
Thursday, 27 August 2009
Local Retail Trades Associations
This week there was an attempt by a local politician in a southern coastal city to try and drum up support for the formation of a local traders association formed from amongst the SME retailers in the area. Why would this be sufficient reason for me to comment? Simple! It was of immense importance and serves to highlight a problem which, if not resolved, will continue to hamper the effective promotion of vitality in our town centres and will mean that Government (both local and national) will continue to fail in the delivery of well meant ideas and strategies.
In itself the meeting was not a particularly spectacular event; low key and poorly attended – in short quite typical for the type of meeting that was being envisaged by its sponsor, a local ward councillor. I know this particular councillor and fully recognise that she is personally committed to the regeneration of the subject area which is the rump of what has been, economically and socially, an enormously important part of the historic city of which it forms a part. The irony is that the prime reason for the dereliction of the area has been because of the planning decisions made by previous generations of councillors, all of whom one supposes were acting in what they regarded as the best interests of the area and of the wider city centre. What is equally clear though is that the very people upon whom the long-term down-sides would fall were not consulted effectively and decisions were made that have undoubtedly blighted the area and paved the way for it to be ‘zoned out’ of the city centre permanently with the attendant drop in local authority expenditure that accompanies that status.
Let us cut to the chase; there is a pressing need for effective communications between planners, decision makers, service providers and all stakeholders representing one part of the community or another. This blog is concentrating on the SME retailer community, if community is aptly applied to this diverse and often disharmonious group. I am not intending to relate the importance of SME retailers to the local economy here, because those arguments have been well rehearsed elsewhere, on this blog site and far beyond. Let us, for the purposes of this note assume their importance. Let us also ask the question about how they are communicated with? They ought to be able to communicate with representative groups – retail trades associations; but they mostly are unable to because they do not exist, or are not active.
Over the years I have frequently heard local authority officers expressing real unfeigned exasperation when attempting to gather real feedback from local businesses about things that were very likely to affect them. I have also known when that exasperation became too much to bear and they simply chose one of two options – they simply did not consult, or they ‘consulted’ with a self-elected person who was neither representative of, nor even aware of the opinions of the neighbouring businesses. I can sympathise with the officers, who having fixed time frames for reporting back to members choose the line of least resistance – the social infrastructures rarely exist in towns for these small, often micro-businesses, to be part of an effective group; they cost in terms of money or of time, or perhaps of both – and whereas there is often a willing horse to carry the immediate burden that comes with trying to disseminate information to these diverse and geographically well spread businesses, that horse will become jaded and less willing when the inevitable happens and the other traders begin the process of shooting the messenger when bad news is disseminated. Changes of bus routes, closure of roads, planning issues and a whole myriad of details that the local authority are responsible for and which will have an impact upon those small businesses.
There are, I know, many organisations who claim to be representative of SME retailers, the problem is that they are usually unable or unwilling to be useful at a local level. There are still many local retail trades associations covering discrete geographic areas, however, these tend to be under-funded and reliant therefore on the goodwill of otherwise busy activist members who invest a great deal of time and resource into ensuring that the area is well served. Where these exist, they can be very good, but they are sporadic, very often they are limited simply because of the time constraints of the activists and the breadth of their knowledge of the workings of the local authorities, of place marketing, of town centre management or of other serious matters that are outside of the normal scope of activities that it would be reasonable of an ordinary shopkeeper.
There are then those organisations that exist to support retailers of which I have counted, so far, over seventy. Of these there are several that claim to be both representative and the most effective. The question is, effective at what. Analysing my list I find that most fall into a small number of categories – those that represent retailers at national level, such as the British retail Consortium, but with a membership fee of over £3000 and with most of the major retailers playing significant roles in the management and strategic directing of the organisation they are very unlikely ever to really be truly representative of the SME sector. There are those who are at the national level representing specific sectors of retailing such as the Toy Retailers Association or the British Shops and Stores Association (recently merged with the British Hardware Federation) or the Association of Convenience Stores; then there are those who represent a smaller geographic (but still wide area) but who are also sector specific such as the Scottish Grocers Association or the very lively Northern Ireland Independent Retail Trade Association. There are those organisations who are not even retail specific, and do not have a retail specific sub-group within their structures, the Federation for Small Business and the Forum for Private Business are two well known examples. This is not to say that they do not carry out very worthwhile work which SME retailers will benefit from, but they won’t help with the local marketing, or the Christmas lights. Unfortunately, local Chambers of Commerce also have too broad a brief in representing their members and this can often lead to conflicts of interest. Many retailers join organisations for specific benefits – for maintaining their knowledge base in their specialist skill area; for obtaining specific and advantageous terms in banking, legal aid or insurance; for keeping up to date with industry trends and developments and for finding new sources of supply. Local trade associations probably would not be any use in providing any of these things, but they would have advantage in having local knowledge, in having a mutual interest in promoting the area and improving its facilities, there would be advantage in many eyes and ears monitoring local events, including planning applications; there is certainly advantage in having a representative voice that acts as a focal point for the local authority and other organisations that impact upon the traders’ area.
Recent Governmental strategies that are intended to make the country work more effectively and to make local communities more responsive and therefore encourage people to take ownership of their area have highlighted a real need to have effective lines of communication open to these small businesses. How, I ask, will the ambitions in the Leitch report ever be realised if SME retailers (and other small businesses) are not fully on board with the idea of training and up-skilling the people who work within the industry? How will local authorities ever achieve what is now their legal responsibility under section 5 of the Sustainable Communities Act 2007 in consulting with representative groups, if when it comes to matters affecting retail trading areas the SME retailers are not ‘grouped’ together. I believe that there is good reason to believe that local authorities should fund local traders associations in the same way that many fund local residents associations. The costs will be small but the returns ought to be immense – democracy amongst the retailers with the costs of communications covered by the LA. The idea of retailers groups ought to be fundamental to any regeneration or renaissance scheme involving retail development, make them compulsory. It’s just an idea, but one which needs to be explored and costed effectively.
Let’s hear from the Councils, what do they think?
In itself the meeting was not a particularly spectacular event; low key and poorly attended – in short quite typical for the type of meeting that was being envisaged by its sponsor, a local ward councillor. I know this particular councillor and fully recognise that she is personally committed to the regeneration of the subject area which is the rump of what has been, economically and socially, an enormously important part of the historic city of which it forms a part. The irony is that the prime reason for the dereliction of the area has been because of the planning decisions made by previous generations of councillors, all of whom one supposes were acting in what they regarded as the best interests of the area and of the wider city centre. What is equally clear though is that the very people upon whom the long-term down-sides would fall were not consulted effectively and decisions were made that have undoubtedly blighted the area and paved the way for it to be ‘zoned out’ of the city centre permanently with the attendant drop in local authority expenditure that accompanies that status.
Let us cut to the chase; there is a pressing need for effective communications between planners, decision makers, service providers and all stakeholders representing one part of the community or another. This blog is concentrating on the SME retailer community, if community is aptly applied to this diverse and often disharmonious group. I am not intending to relate the importance of SME retailers to the local economy here, because those arguments have been well rehearsed elsewhere, on this blog site and far beyond. Let us, for the purposes of this note assume their importance. Let us also ask the question about how they are communicated with? They ought to be able to communicate with representative groups – retail trades associations; but they mostly are unable to because they do not exist, or are not active.
Over the years I have frequently heard local authority officers expressing real unfeigned exasperation when attempting to gather real feedback from local businesses about things that were very likely to affect them. I have also known when that exasperation became too much to bear and they simply chose one of two options – they simply did not consult, or they ‘consulted’ with a self-elected person who was neither representative of, nor even aware of the opinions of the neighbouring businesses. I can sympathise with the officers, who having fixed time frames for reporting back to members choose the line of least resistance – the social infrastructures rarely exist in towns for these small, often micro-businesses, to be part of an effective group; they cost in terms of money or of time, or perhaps of both – and whereas there is often a willing horse to carry the immediate burden that comes with trying to disseminate information to these diverse and geographically well spread businesses, that horse will become jaded and less willing when the inevitable happens and the other traders begin the process of shooting the messenger when bad news is disseminated. Changes of bus routes, closure of roads, planning issues and a whole myriad of details that the local authority are responsible for and which will have an impact upon those small businesses.
There are, I know, many organisations who claim to be representative of SME retailers, the problem is that they are usually unable or unwilling to be useful at a local level. There are still many local retail trades associations covering discrete geographic areas, however, these tend to be under-funded and reliant therefore on the goodwill of otherwise busy activist members who invest a great deal of time and resource into ensuring that the area is well served. Where these exist, they can be very good, but they are sporadic, very often they are limited simply because of the time constraints of the activists and the breadth of their knowledge of the workings of the local authorities, of place marketing, of town centre management or of other serious matters that are outside of the normal scope of activities that it would be reasonable of an ordinary shopkeeper.
There are then those organisations that exist to support retailers of which I have counted, so far, over seventy. Of these there are several that claim to be both representative and the most effective. The question is, effective at what. Analysing my list I find that most fall into a small number of categories – those that represent retailers at national level, such as the British retail Consortium, but with a membership fee of over £3000 and with most of the major retailers playing significant roles in the management and strategic directing of the organisation they are very unlikely ever to really be truly representative of the SME sector. There are those who are at the national level representing specific sectors of retailing such as the Toy Retailers Association or the British Shops and Stores Association (recently merged with the British Hardware Federation) or the Association of Convenience Stores; then there are those who represent a smaller geographic (but still wide area) but who are also sector specific such as the Scottish Grocers Association or the very lively Northern Ireland Independent Retail Trade Association. There are those organisations who are not even retail specific, and do not have a retail specific sub-group within their structures, the Federation for Small Business and the Forum for Private Business are two well known examples. This is not to say that they do not carry out very worthwhile work which SME retailers will benefit from, but they won’t help with the local marketing, or the Christmas lights. Unfortunately, local Chambers of Commerce also have too broad a brief in representing their members and this can often lead to conflicts of interest. Many retailers join organisations for specific benefits – for maintaining their knowledge base in their specialist skill area; for obtaining specific and advantageous terms in banking, legal aid or insurance; for keeping up to date with industry trends and developments and for finding new sources of supply. Local trade associations probably would not be any use in providing any of these things, but they would have advantage in having local knowledge, in having a mutual interest in promoting the area and improving its facilities, there would be advantage in many eyes and ears monitoring local events, including planning applications; there is certainly advantage in having a representative voice that acts as a focal point for the local authority and other organisations that impact upon the traders’ area.
Recent Governmental strategies that are intended to make the country work more effectively and to make local communities more responsive and therefore encourage people to take ownership of their area have highlighted a real need to have effective lines of communication open to these small businesses. How, I ask, will the ambitions in the Leitch report ever be realised if SME retailers (and other small businesses) are not fully on board with the idea of training and up-skilling the people who work within the industry? How will local authorities ever achieve what is now their legal responsibility under section 5 of the Sustainable Communities Act 2007 in consulting with representative groups, if when it comes to matters affecting retail trading areas the SME retailers are not ‘grouped’ together. I believe that there is good reason to believe that local authorities should fund local traders associations in the same way that many fund local residents associations. The costs will be small but the returns ought to be immense – democracy amongst the retailers with the costs of communications covered by the LA. The idea of retailers groups ought to be fundamental to any regeneration or renaissance scheme involving retail development, make them compulsory. It’s just an idea, but one which needs to be explored and costed effectively.
Let’s hear from the Councils, what do they think?
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