In the past weeks, we have seen yet another bout of retailers going into administration, evidence of just how ‘unfit’ the retail environment is out there.
Some of the many external challenges we are hearing about include:
- Global retail juggernauts entering the country
- Online sales and the “GST on overseas purchases” debate
- Increasing rental costs
- Fast-changing consumer trends
- Speed of technological innovation
- Price deflation
And with yesterday’s decision by the RBA to hold the cash rate, there is no immediate external relief in sight.
Whilst we can’t change the headwind, we can adjust the sails; and this, in many cases, needs to be done immediately.
So what can we adjust in our businesses to get ‘fitter’ and meet these challenges? What do we need to adjust to meet the needs of changing consumer needs and a changing competitive landscape?
There are a number of internal operational factors that you can control to help build your business fitness including:
- The supply chain efficiency – speed to market
- Your cross-channel distribution model
- Product ranging, profile depth, quality and design
- The utilisation of technology to derive ‘fitter’ business decisions
- The culture of your business – “the way we do things around here”
- The leadership of your people – creating a motivating, goals-driven sales environment
- The selling performance of your people
- Your measurement of the vital ‘health signs’ of your business (KPIs)
- Your expense ratios
- Your retail economics/cash flow and planning
It’s about knowing your goals, understanding your consumers and market and delivering an offer that meets their needs. This flows right through from your core goals and vision for the business through to how your salespeople communicate and sell, how you display your merchandise, how you deliver product to online customers, the list goes on.
The hallmark of a ‘fit’ elite business is their ability to control what they can control and set themselves up for success by being the best they can be. ‘Fit’ retailers concentrate and focus on what they can do, not what they can’t, they differentiate themselves and prove their worthiness in the industry by controlling all the aspects of their business that they have control over.
No doubt it’s a challenging time, especially for the smaller retailers out there, but before you jump ship, think about what you can control within your business to compete and thrive.
Happy ‘fit’ retailing.
Brian Walker is the managing director of Australasia’s leading retail consultancy, Retail Doctor Group.