A group of retail experts (QVM Traders) was discussing the retail revolution this week and particularly which traders are most at risk of not surviving the global downturn.
With a background of high profile retail failures (Toys’R’Us being the latest) and traders leaving our market it is difficult to avoid the harsh reality of retail right now.
It turned out it was easier to identify those types of traders who are most likely to survive than the other way around and our experts agreed that at least some of the following ingredients were likely to be evident in successful traders -
1. Direct sourcing of goods - cutting out the middle man, and reducing costs by going straight to the manufacturer. This allowed extreme price competitiveness at the shop front.
2. Manufacturing your own goods - similar to item 1, making your own goods enabled significant cost savings and higher margins.
3. Websites and online - expanding your footprint so that you are accessing customer business outside standard market trading times is becoming more important. Going online has long been questioned by traders particularly because it is not easy to see an immediate return, but evidence is mounting that online is slowly but surely becoming an essential element for many retailers. Just this week, Australia Post reported a 20% lift in parcel volume as consumers embrace online ordering. Put it this way, if you don’t qualify under 1 or 2, this may be your saviour.
4. Exclusivity – making your own goods isn’t the only way of establishing a unique offer. How you source, brand and present a range can impact on its uniqueness.
5. Expanded service - this means nailing the customer service aspect and going the extra mile to meet and exceed customer expectations. It will almost certainly include the online aspect, as well as delivery and packing services, electronic communication, and extreme attentiveness at the shop front.
6. Willingness to change - our experts suggested that those traders who had shown little inclination to address any of these factors would be most at risk.
How do you stack up?