Retail 2023 - An Independent View

As we find ourselves rushing towards Christmas and the busiest period of the year for retailers, I wanted to focus in on how the Independent Retail sector has had to adapt given the challenges of the past few years.

As I discussed in my previous article, we are seeing varying degrees of success on the high street, from big names opening up huge flagship stores in the hope of differentiating the in person experience, to other big names collapsing amid seemingly bad decisions at the top. We are also seeing a lot of consolidation and acquisition of well know brands and bringing them under a bigger banner for example the approach we are seeing with Frasers Group and Next.

This new breed of 'super' retailer needs to invest large sums of money to turn the fortunes of the failing brands around and this is no easy or quick feet to achieve. Quite often, retailers invest heavily in the 'front of house' to make the final experience of purchasing something really smooth, but behind the scenes there can be a myriad of legacy services and systems that have been bolted together over many years. These systems are the glue that holds the company together but can also often be the thing holding them back through not being scaleable or intelligent. This point, to my mind, is undoubtedly one area that these failing or failed High Street retailers had in common and when you combine this with other economic headwinds it painted a very stark picture for these companies.

So, how are the smaller companies riding these issues out? Independent Retailers don't have the economic power and financial clout that the bigger high street and online retailers do, so, clearly every investment and strategic decision counts. The other point to note is that they are more agile and nimble and have the autonomy to make quicker decisions that allow them to course correct as necessary.

Some Independent Retailers were 'born in the cloud' and as such avoid the complexity of the legacy systems I mentioned previously, but this mere point alone doesn't make them impervious to failure. Others who have been around for a longer period of time have had to find ways to adapt and change their approach to stay afloat in the choppy waters.

Earlier this year, I was lucky enough to meet with Lee Ferris , Managing Director at Bell of Northampton, where he shared his thoughts on what it takes to be a successful Independent Retailer in this day and age. Here is some of what we discussed ; -

Please tell me a bit about Bell

Bell are a multichannel home lifestyle store who are celebrating their 125th anniversary this year! Based in Northampton our showrooms are in excess of 25,000 sq. ft. and we are a one stop shop for the home including Kitchens, Bathrooms, Fires & Stoves, Outdoor Leisure and much more. Over the years we have built a reputation for quality products and service and our routes to market include B2C, B2B via our Contract (Developer) division and e-commerce.

It's fair to say that retail as a whole is struggling with lots of well-known brands going into administration or disappearing from the high street and moving to online only.? There are obviously economic pressures that are contributing factors to all these companies’ issues, but what are your thoughts on this situation generally and then secondly how are Bell navigating their way through all of these external issues?

The events of the last few years (pandemic, Brexit, cost of living crisis etc.) are unprecedented and businesses have needed to be very agile to navigate their way through it.? It’s been a tough few years, the latest challenge is inflation and high interest rates. This is slowing the housing market, which has a direct impact on companies like us that supply the main fixtures for the home. We are pitched in the mid to high end of the marketplace which helps. We have noticed a drop off in orders for our entry level offer but the top end seems relatively unaffected. For example, we are selling fewer kitchens by volume, however the average order value is much higher.

Bell is clearly a company with a long history and good reputation in Northampton, but just having a trusted brand doesn’t make you bullet proof from all the change happening and struggles other retailers are seeing.? What is Bell doing to stay ahead and help your customers choose you over national chains?

As an independent with staff invested in our brand, we believe we can offer a better, more bespoke service than our national competitors. Exceptional levels of customer service and merchandising of the showroom are key to making us stand out from the rest.

Covid obviously had a big impact on many parts of our lives and retail was one of those.? How did Bell approach operating the business during the pandemic and what have you seen that has been different since we returned to normal?

Being multichannel definitely helped us to successfully come through the pandemic. For example, during lockdown our showroom was closed, however online sales for Outdoor Living products for items such as BBQ’s was exceptionally strong, enabling us to maintain a key revenue stream. Since lockdown we have seen reduced footfall but higher conversion rates. We believe that this is because more of the people visiting our store are interested in purchasing rather than simply having a casual look around.

You have a large showroom here that showcases the different products and services that you provide as well as some concessions.? What value do you place on having an in store experience for your customers and what do you do to make it enticing for them to visit?

Bricks and mortar stores need to give customers a compelling reason to visit. Retail is more akin to a leisure activity these days. We display our products in large inspirational room settings where customers can see the latest trends and gain inspiration. We also hold regular instore events such as cooking demonstrations, themed open evenings etc. and also have a Café in store serving food made fresh on the premises each day. There is always something new to look at when visiting our showrooms.

As Managing Director of Bell, what is Top of Mind for you to keep Bell around for another 125 years?

Innovation & Change! The only way that we can thrive is to continually evolve and improve which is what Bell have always done. For example, late last year we invested in a new Retail Operating System for our business. The system gives us detailed visibility of inventory, sales and margin enabling us to make informed decisions around stock and pricing. Having this real time information at our fingertips has been a real game changer and has already helped us to become more efficient. Another benefit of the system is the streamlining of our order processing including more automation. The reduction of manual processes has freed up our staff to do more meaningful tasks and have more time to communicate with customers.

As you can see from Lee's insight, being successful in this area is not based upon a single factor - you have to be across all of these different areas to be able to not only compete but survive. Now roll this up in to a big national or global chain and the challenges Lee and other similar companies face is magnified and one wrong decision or one delay in stock hitting the shelves on time to meet the optimum selling window can have catastrophic effects on the company's ability to survive.

I hope that this coming Christmas trading period provides small and large retailers alike with the sales they need to continue into 2024 and beyond. Thank you for reading and please let me know your thoughts in the comments.

#retail #shopping #independentretail #independent

About the Author: - John Pell is a UK based Solution Consultant at ServiceNow and has worked in the IT industry for over 20 years covering various roles and industries.

PLEASE NOTE : The views expressed in this article are those of the author and are not representative of the author's employer.

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