Archive for July, 2009

Here’s a novel idea – let’s go offline!

Thursday, July 30th, 2009

Over the last few years everyone has been talking about marketing via Websites, Blogs, Twitter, Facebook, iamthenextbigthing etc that it’s easy to forget or dismiss good old-fashioned advertising.

If your outlet(s) are localised there is little to be gained by telling the whole on-line world that your Autumn/Winter collection is in-store soon. However, targetted local advertising may well be better use of time and money.

I’m sure we’ve all used the local papers but have you tried posters and billboards? It may be cheaper than you think.

Check out www.signposter.com

Try the search in your area and it will give you the places where you can put a poster, the price for 2 weeks and the weekly ‘audience’. For example, in my area I could get a ’48 sheet’ poster with a weekly audience of 154,660 for £689 or they can do a package for £1,500 which gives you 1 poster site,  1 phone box and 2 bus shelters for £1,500 for 2 weeks.  If they are viewed by 250,000 people and 0.1% visit your shop that’s 250 customers. If 25% of them spend £50 you’ve taken an extra £3,000+ and hopefully, treat them right,  they’ll come back again with some turning into regular clients.

I’m not advocating signposter.com in particular as there are other companies doing similar – www.postersitesuk.co.uk www.positivemediamarketing.co.uk  for example (Google for loads more) but the sign poster site is easy to use and gives a good overview.

There’s also something psycololgical about seeing posters in that it can often give the impression that you’re are ‘bigger’ and ‘more established’ company.

Don’t forget if you are thinking about doing it – EVERYTHING IS NEGOTIABLE!

Good Luck

Tony Heywood – Gilcrest Services Ltd
Retail Troubleshooter
Business Turnaround and Recovery
www.gilcrest.com
www.linkedin.com/in/tonyheywood2


End of the bargains? – Not according to PWC

Wednesday, July 22nd, 2009

UK retailers are likely to continue discounting right through to the first half of 2010, according to a report by PricewaterhouseCoopers [PwC].

The PwC survey of 100 high street retailers revealed that 90% were currently on sale and that discount levels were above 60% – similar to those in the run up to Christmas last year and January Sales.

The survey said there was also an element of “de-stocking”, with retailers trying to shift some out-of-season stock in order to get cash into the tills and people in their stores.

Discounting was spread across all sectors of retail with luxury brands, mid-market and value players all promoting Sales, both in their shop windows and on their websites.

A spokesman for PwC said: “Following the peak level of discounting in the January Sales many stores have continued to promote discounts throughout 2009, to the extent that some corners of the UK high street seem to be on constant Sale.”

“Discounting will be an ongoing trend for UK retailers for the rest of 2009 and through the first half of 2010. This is good news for consumers, but less positive for retailers, whose margins have been and will continue to be under constant pressure.”

This seems to contradict my last post which just goes to show that we’re in ‘uncharted’ territory and nobody has any idea how deep or long this downturn will be.

Tony Heywood – Gilcrest Services Ltd
Retail Troubleshooter
Business Turnaround and Recovery
07905 848 111
www.gilcrest.com
www.linkedin.com/in/tonyheywood2

Summer sales earlier with bigger discounts – but is this the end of the bargains?

Monday, July 20th, 2009

Data from Ernst & Young, the professional services group, show that retailers this year launched sales on average more than 10 days earlier than last year. Also price cuts of 50 – 75% are commonplace as many retailers have had ‘promotions’ on since Christmas and are having to offer even bigger discounts.

However, is the period of consumer bargains about to end?

“…. enjoy it while it lasts,” said Neil Saunders, consulting director at Verdict, the retail research group. “This may be the final fling for the consumer for hefty discounts.”

Retailers face higher costs for the Autumn ranges, with a VAT increase scheduled for the middle of this year’s winter sales period. Since many also pay dollars for goods from the Far East, a slumping pound has further increased their purchase costs. Although there has been some recovery in the pound it is still worth 20% less than a year ago. i.e. an item priced at $2 cost £1 in July 2008 but costs £1.21 in July 2009. Against the Euro the Pound has fared a little better recovering to 92% of it’s rate a year ago.

Will retailers need to factor in the VAT increase to 17.5% from Jan 1st 2010 or will it be a case of unsold Winter stock by that time will already be in the sale? Will you need to look at pricing regular lines differently to seasonal ranges? All in all, it’s a bit of a mess which I don’t think the Government really thought through with their ‘knee jerk’ reaction to  the downturn.

I suspect that as most retailers ordered their Autumn/Winter merchandise during the ‘depth of the recession’, that quantities committed to, are ultra cautious.  It’s probable that there will be much less surplus stock which needs to be marked down going forward so this could well be the beginning of the end of the bargains enjoyed by the customer.

From a Retailers point of view – let’s hope so.  As  a consumer – bah humbug!

Tony Heywood – Gilcrest Services Ltd
Retail Troubleshooter
Business Turnaround and Recovery
07905 848 111
www.gilcrest.com
www.linkedin.com/in/tonyheywood2

p.s. I attended the opening day of the Next sale on Saturday (and no I wasn’t there for the 5 am opening!) and was surprised at how little stock was in the sale. A good 2/3 of the ranges were still at full pricing. Good to see that their acknowledged expertise for stock management is still holding up. So although sales may me down their bottom line should not be impacted as much as their competitors.

Clothing and Footwear Pricing ‘Double Whammy’!

Monday, July 13th, 2009

Annual deflation in clothing and footwear rose to 6.5% in June on BRC-Nielsen Shop Price Index.

The value of retail sales in May fell 1.1% compared with last May, and textiles, clothing and footwear was the worst performing category, down 8.4%, according to the Office of National Statistics.

Coupled with the fact that cost prices have increased due to the weak pound, clothing and footwear retailers are getting hit  from all sides and there seems to be no sign of an immediate respite.

It would seem the volume of sales are fairly static with the May’s 8.5% drop in sales accounted for by the 6.5% deflation and VAT reduction but it’s still a huge hit on the margins. Philip Green (Arcadia Group) has concerns about how the general public will react to the price increases coming through in the Autumn ranges reflecting the poor exchange rate on imported goods.

It may well be that the public do not accept the new pricing levels with many choosing to wait for the inevitable discounting to start. This could well mean that ‘Mid Season ‘ sales and 1 day ‘events’ may start even earlier this Autumn – particularly as the September rents become due.

If you are still trading today, I guess you have already adopted many of the survival techniques and tips from earlier blogs. All your costs are under control, staffing levels at a minimum, maybe negotiated with your landlord and received some concessions, so it’s only left for me to remind you to ensure that you keep your stock levels under control and try and keep some of the budget back for last minute ‘deals/offers/special purchases’ from your suppliers to boost your margins.

Stick at it – it’s going to be a long haul – but the good times are coming again – slowly!

Today’s news that 7 out of 10 Woolworth’s stores are still lying empty is not good news for the already beleaguered High Street. Interestingly while more than half the Woolworths stores in Greater London have been let, 80% of sites in Scotland, and 90% of those in the North East are still empty. Although some good news (for retailers) is that landlords have been forced to offer reduced rents and incentive packages to let the shops, causing a drop in high street rents across the board.

Perhaps it’s time to relax some of the planning rules as there still seems a demand for A3/A5 units in the High Street but Local Councils are still trying to push back the incoming tide and  restrict access. In my local High Street Nandos were refused a change of use on a large unit which has remained empty for nearly 2 years. If you can’t attract a ‘traditional’ A1 user then it must be better to allow change of use to ‘revitalise’ the area, create employment and get in extra taxes.

Tony Heywood – Gilcrest Services Ltd
Retail Troubleshooter
Business Turnaround and Recovery
www.gilcrest.com
www.linkedin.com/in/tonyheywood2
http://blog.esellit.com

Do you want a temporary retail let or have an empty shop?

Friday, July 3rd, 2009

This may be of interest to readers who have empty shops on their books or are looking for temporary lets

Popupspace.com is a new website dedicated to temporary letting of empty retail property. Temporary or pop up shops are becoming a more and more attractive proposition for both landlords and retailers in the current economic climate. These kind of lettings offer a great opportunity for small businesses to trade from prime locations at bargain rents, without the commitment and obligations that come with a long lease.

Popupspace.com also offers start-up businesses and independent retailers, the chance to create their own (free) profile listing detailing their business and their property requirements. Once retailers have created a profile, landlords can search for them and contact them with property offers. Retailers can also print out or email their profile to anyone they want to let know about their property requirements. It can be very helpful for them to have such a proposal to send to prospective landlords.

The website offers free advertising for landlords and commercial agents with vacant property to let.

Popupspace.com has only just launched and we are keen to get as many independent retailers as possible involved.

Contact

Rosie Cann
Popupspace Ltd
t. 01273 272350
rosie@popupspace.com
www.popupspace.com

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Tony Heywood – Gilcrest Services Ltd
Retail Troubleshooter
Rescue and Recovery Consultant
www.gilcrest.com
www.linkedin.com/in/tonyheywood2