Sunday 26 February 2017

A Market Story - The Day The Rot Set In

One of our senior traders says he can identify just when the decline in retailing started at QVM and he goes back to the time when J shed was populated by a huge range of fabric sellers.

One of the fabric sellers at the top of J shed sold only top quality suit fabric and there was a queue of tailors at his stall each morning. His fabric was very expensive, let’s say for illustration purposes, $100 per metre. At the other end of the aisle another fabric seller had 50c per metre fabric and he was also inundated with customers. In between was a huge range of different offers, all providing a specific type, quality and pricepoint for their group of customers. There was no better place to come for fabric than The Queen Vic Market, and you could find everything you wanted in the one aisle.

You are probably already saying that fabrics have declined in importance but stick with the story because our trader insists that the lessons to be learned apply equally to all current market categories.

When did the rot set in? One of the fabric sellers left the market and instead of replacing him with another fabric seller, the management at the time went to the Trader Allocation System and selected the longest serving trader. He didn’t sell fabric, and our trader can’t quite remember what he sold but let’s say it was toys or liquorice. That trader had demanded his right to be next in line and management had found an easy way to avoid conflict.

The nexus had been broken. The aisle was no longer curated for fabrics, customers could no longer be guaranteed a focused offer and that trend continued in most of the stall allocations that followed.

The lesson is simple – once you neglect the customer as the most important ingredient in this equation and defer to selfish trader interest or management convenience you run the risk of retail decline. Our market needs to make sense (and offer convenience) to our customers – no arguments.

Have Your Say – click here.

28/02/2017 10:19:28 The Rot "Tackling 'the Rot' in the Market is a big ask. So I'll take your title as a hook to get people reading rather than a suggestion that there is one simple problem/answer to the challenges markets face worldwide.

But let's look at the substance of the article, and fundamentally on the one hand it is a discussion over customer wants/needs over trader wants/needs (especially when the 2 are in conflict with one another). Secondly it is about the process which determines which traders go where.

I would think everyone understands the almost total merit in putting customer interests over trader interests. Where we get into some treacherous waters is when we discuss how to achieve that ideal.

So whilst in principle market curation is the right way forward, here are some basic prerequisites necessary to ensure optimum results.
1) Any system which decides which traders go where needs a rigorous and robust system that ensures at least 3 things, they being: CONSISTENCY / TRANSPARENCY and ACCOUNTABILITY. Without these there are ever present risks that you have got rid of one possible problem (trader self interest) but haven't done much to address the other 'rot creator'.
2) To ensure that you have curated the market in the true interests of the market/customers you need to have a deep and accurate understanding of the retail environment and what customers truly want/need (something which isnt always easily understood no matter how many surveys you do).

Historically the disconnect between management and the market floor, whether it is their lack of knowledge (and interest) around sales trends, market saturation, retail knowledge, foot traffic etc. etc. etc hasn't exactly engendered great confidence (That includes efforts to populate A Shed and C Shed over the last few years). So whilst I personally agree in principle in the concept of curating the market (it must happen) I also personally am very wary of how/who, given our rather paltry record so far." Hugh Know Who

Thanks Hugh. That is some great input and you are right, this is much more complex than the original article suggests. But in relation to the disconnect between management and the market floor we may need to observe that there are a number of measures in Malcolm McCullough's re-organisation that will help address that issue. There is Malcolm's own retail experience, the creation of Category Managers, the appointment of  a General Manager, Market Trading who we believe will have retail experience, and the creation of Business Manager roles with on the floor responsibilities. - Ed