Tesco cuts back it's 24 hour operation - what can retailers of all shapes and sizes learn from this?

A story caught my eye in the news this morning. It is regarding the fact that Tesco is paring back it's 24 hour operation in a large chunk of their stores. The reason quoted in the article is the fact that online shopping is eroding their in-store customer base.

I can see that an upturn in online shopping (with a similar downturn in customers physically visiting their stores) can have an effect on how long you need to keep the doors open. I know that big retailers have been backwards and forwards will having their stores replenished overnight or not. But this is more like a complete change in strategy for Tesco rather than a tweaking of a few opening hours.

The 1990's through to the last couple of years have been all about expansion got the big retailers, particularly the supermarkets. They bought up land, drove into new markets and employed more and more (often part-time) staff. The recent scandals and the competition from the discounters has put Tesco on the back foot. It has also given them an opportunity to assess where they are and where they want to be. 

Expansion for the sake of it means nothing.

If it's not an area that makes money then why bother with it?

And that brings me to your business. I'll ask the exact same question-

If it's not an area that makes money then why bother with it?

It's time to assess all aspects of the retail business that you work in and decide whether they are all pulling their weight. Your business needs to be as efficient as it can be. Unless an area generates footfall that you need. The National Lottery is an example of this. The income it generates is poor but it drives people through the door that may buy other things.

The best way to do this is to break down your business into different areas and attribute costs to each of these areas. This can be staffing costs, materials, energy use or whatever resources this part of the business consumes. Then measure this against the income it brings in. You will soon generate a list of the performance of every aspect of your business. From there you can see the top performers and those that aren't quite doing so well. Assess the likely impact of removing some parts of your business and moving the resources into others.

• Does this work?
• Will it being more income?
• More profit?

It is by analysing everything that you do that can make the difference between profit and loss. Don't wait for a major event to hit you like Tesco. Act now.

This week is the MUST DO week when it comes to assessing how your Christmas sales are going

It's a hugely important time of the year for most retailers. I know of some retailers that trundle along through the rest of the year happy to break even or make a small profit on the basis that their Christmas trade will make up for it all. Many retailers I've worked with report that over 50% of their annual trade will happen during this quarter of the year. And there's the sales after Christmas to take into account as well!

With this time of year being so important, so busy, you can often forget to take a small step back and assess things. So ask yourself this question today-

How is it going?

Really. Find some time this week to answer that question. It's vital to the success of the rest of the year.

The big retailers have cottoned on to one truth that I'm going to share with you today-

Customers only have a finite amount of money to spend at Christmas.

It sounds pretty straightforward doesn't it? But it changes the way they operate. Their whole ethos is based around getting you (and your customers) to spend it with them and to spend it early. Look at the incentives-

• Extra loyalty card points
• Tesco Clubcard exchange
• Sainsburys Nectar point exchange
• Boots points events nights
• Boots Star Gifts and weekly offers
• Black Friday
• Cyber Monday

And the list continues. The idea is that you incentivise your customers to shop with you early. A typical Christmas list might read-

• Wife
• Eldest
• Youngest
• Mum
• Dad
• Mother-in-law
• Sister
• Brother
• Niece
• Nephew

And once there's a tick next to every name on the list, then Christmas gift shopping is pretty much done. So if it's done at a Boots points event, for instance, then the spend at Boots will minimise the likelihood that there will be any spend in other retailers nearer Christmas.

As for Black Friday and Cyber Monday, these are not American imports, as the press likes to label them. These events mean more to the British market than the American one. In the USA, it's our equivalent of the January sales - they are selling off post-Thanksgiving stock that didn't sell. They don't do Christmas in the same way we do. Over here it a great tool for retailers to get those sales in early.

So have a look at what you have done and what you have planned and see how you can secure those early sales. It will make a big difference to your performance for the rest of the year.