“Talent hits a target no one else can hit; genius hits a target no one else can see.” – Arthur Schopenhauer
Due north, size of the prize, the summit, end game, etc, are all euphemisms for the most simple of necessary starting points for any retailer, and that is simply to name and define the target that you are aiming to achieve.
Sounds too basic to be true? Well, put yourself in my shoes for a moment and ask yourself the following:
- What EBITDA multiple do I want to sell my business for in 2017? (for example)
- Who are my likely buyers?
- Do I have or am I creating a business that is increasingly independent from me?
- Do I have a sales and margin growth plan by category over the next few years?
- How is my business innovating and staying ahead of the curve?
- Have I invested sufficiently in funding (such as business information systems) to maximise the trading returns?
In other words – are we working towards the size of the prize or are we simply working with little real destination in mind?
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Imagine, if you would, that you have the car packed for your holiday with no destination in mind.
The other key fitness tips that separate high-performing retailers the world over are summarised as:
- They have good, strong, defendable, unique and leveraged positions in the marketplace.
- They are outcome-driven and lead their people to the outcome.
- These retailers know every detail of their business.
- They are obsessed with the quality of product and service (think Steve Jobs).
- They are brand fanatics who live the brand at every touch point.
- They are specialists who can innovate and stretch the brand without trying to be all things to all people.
- They communicate with their customers at the macro and micro levels.
- They are customer-centric at every channel touch point.
- They create “crusade” cultures amongst their people.
- They are supply chain specialists who take every opportunity to increase margin and speed to market.
- They are very good at inventory management and great merchandise managers.
- They always look for a different angle for their business, be it innovation or just simply doing it better than their competitor.
- They understand the productivity drivers of their business.
- They follow a mantra of manage-measure-lift the bar, manage-measure-lift the bar, etc.
- They invest in systems to deliver competitive advantage rather than data.
Name 15 of the best retailers globally and domestically and I am confident that they would tick the box across all these high business fitness symptoms.
Happy fit retailing.
Brian Walker is the managing director of Australasia’s leading retail consultancy, Retail Doctor Group.