Why seemingly impossible business transformation can be possible?

This current restricted situation is causing organisations to reassess their business model…

Some tweaking how they provide products, others pivoting to provide complementary products, many closing offices to homework, and retailers closing stores to do more online sales.

5 years ago, we did all these things at once…

Brought on by 3 strategic inflection points (major events that change the market) which happened within a short space of time of each other.

1st it was the financial crisis. Then came fast broadband & the online stores. Finally, it was the super supermarkets built in town (selling everything 24/7) that pushed us over the edge.

Although it’s 1 strategic inflection point (not 3) causing current market conditions, it’s the biggest inflection point we’ve seen in our near 18-year business journey.

The business transformation we had to go through 5 years ago, seems current (in part or whole) for many organisations today.

We had a retail business, with a network of stores selling printers and printer related consumables to walk in customers.

Our 1st change was to offer business accounts and a free same day delivery service.

The 2nd change was to provide complementary products like stationery, office supplies and office furniture.

And the 3rd change was our own range of home & small business monthly subscription printer technology solutions, on fixed price agreements, including everything with no strings attached.

By far though, the hardest thing we had to do…

Was to close our retail stores and move into a business unit. Financially, this was extremely difficult and has taken us years to fully recover.

But if we didn’t do it (because our business model had changed so dramatically) very soon we were going to implode and grind to a halt, through a lack of space and systems.

We’d already had to get bigger vans (which were put on finance) and we were selling products that were much physically bigger than we were geared up to handle.

Each morning the stores would be jammed with products to be delivered, and it was only going to be a matter of time before things would spill onto the shop floor.

Desks, chairs, cupboards, filing cabinets arrived and had to be delivered, along with smaller stationery items, catering products and workplace solutions.

There’s not much room in a small shop, and as our team won new customers, we were going to reach breaking point.

But we also knew, this next phase was going to be the most difficult in our short history, and would either make or break the business.

Before we could plan anything, we had to work out when we could do it. And it had to co-inside with our store leases ending. Aside to finding an affordable unit in the right location.

We found a unit in an ideal location on the Lancashire / Greater Manchester border in Haslingden, and negotiated a March exit from our existing leases.

Which meant we could aim for an Easter weekend move, giving us four days to clear out the shops, transfer the stock and get everything set up for the following Tuesday.

Part of the planning included an online ordering system, with options to pay online, over the phone or on account (for business & organisations), and all delivered same or next day for free.

We already had an internet phone system which connected the stores. So, we just brought it with us, and it was an easy online reconfiguration. Even the existing store numbers came with us too.

Then we advertised the hell out of it. Ringing, writing, and emailing every customer clearly explaining what’s happening.

The day of the move I woke at four in the morning, dripping in sweat. My mind was racing. What if this happened. What if we couldn’t do that. Anxiety took hold.

For the next hour I lay with my eyes wide open. My mind racing a thousand miles an hour. There was no chance of getting anymore sleep.

So, I slipped out of bed, crept downstairs and had a long hot shower.

Still with hours to fill before the day really started. I decided to take our dog (Shadow) on an ultra-long walk to clear my thoughts.

Shadow was an English Springer Spaniel and named after the Springer in Michael Morpurgo’s book ‘Shadow.’ And he was no different, always by my side (looking for food). The perfect shadow.

The walk did us both good. Shadow was content and laid on his bed. And I had cleared my thoughts and formulated a clear plan, what was to happen over the next three or four days.

In the weeks prior, we got the unit as much ready as we could. Electrics and heating had been installed, desks and chairs were built. The warehouse racking was put together and ready in location.

We were using the existing business system. Which was one less thing to worry about. Although, the separate store systems still had to be integrated into one and a new office network configured.

A stock control system was already available in the existing software. But we hadn’t needed to use it before. In this new world though. We had to know what was available. Because we couldn’t see it.

But. Before any of this could happen, the stock from the stores had to come to the unit and be organised. And the stores had to be cleaned out from top to bottom.

Throughout the move the team we’re absolutely fabulous.

Thursday night we bagged the rubbish. Friday, we boxed and labeled the stock. And then cleaned down the stores.

Whilst Steve (our IT guru) got on with integrating the three systems, building the new network, and configuring the stock control system.

Saturday saw a change. Adam was given the important job of unpacking and organising the stock. Ready to add it to the stock control system once Steve had it configured.

The rest of us broke out the paint rollers and by Sunday lunch time, the walls were covered as required. Leaving just Adam to finish populating the stock.

Arriving at the unit. I thanked everyone for the immense effort they’d put in and handed each a bottle of Prosecco to celebrate.

I wished them well. Thanked them again. We were all happy to have a little down time before officially opening on the Tuesday morning.

Tuesday arrived. Everybody was a little early and full of anticipation. We prayed our new systems and the 1000’s of customer letters and emails we sent, would secure much of our existing business.

Initially, it was a very worrying time…

In The first few weeks we’d seen a sharp decline in the old walk in customer business. Which at the time, still accounted for 40% of revenues.

It was down by 50%. Meaning our overall revenues were down by 20%. This was a large amount of cash and meant we were losing money.

We panicked. We’d communicated several times with all customers. Built ordering systems and provided free same day delivery.

To financial support the move we had negotiated a bank overdraft but were already eating into it and at the rate of the losses, it wouldn’t last long.

We concluded some people just don’t like change. Suspecting the lost 50% will not change, wanting still to walk in somewhere to buy a cartridge. Most likely now buying from the supermarket.

Furthermore, we accepted we were unlikely to change these habits, unless we could convert these people onto our home subscription printing package.

On our current trajectory we’d lost 20% of revenues. When working this back to net profit. We were losing about ￡5,000 a month.

We had 6 months to turn the situation around. And the quicker we reduced the losses, the more time we’d buy.

Our retail business had a heart attack and was flatlining. We’d jumped started it, and got it going again. But it’s going to take time to recover. When it did, it’ll be a completely different business.

Don’t get me wrong. We needed to get back as much of the walk-in business as we could. But over time we had to attract more business customers to lessen the reliance on consumer transactions.

We were honest and transparent with our team. And their reaction was magnificent. With their backs against the wall, they dug in, stood tall and did everything they could to help.

We focused hard on 3 things:

• Attracting new business customers
• Growing business in the existing business customers
• Converting old walk-in customers onto printer subscriptions

Three months passed, and we were in a better place. The team over delivered against expectations. Losses were down to ￡2,000 a month, and it was only a matter of time before we broke even.

Since then…

We’ve come along way towards our vision of ‘making office technology affordable for all’, with many other ‘fit for purpose’ solutions. Including copiers, internet phones and laptop bundles.

In these difficult times, I wanted to tell you our business transformation story. Yes, it’s difficult, but business transformation is possible if you’re willing...

…to make the impossible possible!