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.

A return from holiday leaves me needing a catch-up

I've now returned from three weeks holiday. A three week break brings lots of thinking time but the return to reality and activity is tougher than I remember.

I've kept physically active whilst away, with a gym and swimming pool on the complex I've been staying on. But a lot of time on the road, by the pool, in the gym and on the beach gives you plenty of time to think about what you are doing and where you want to start going next with everything you do.

I think that it is good (and it was good) to have a period of reflection and contemplation. It gives you a chance to determine whether you think that you're on the right track and to plot the way forward without the everyday distractions of work life. It also enables a little "blue sky thinking" as there exposure to a different routine and a different culture can have you thinking about things in different ways. I have looked at the direction I'm heading in and I broadly think that it's where I want to be going.

It's now thinking about heading out of the break and back into my life that's occupying my mind. I landed and got home in Sunday evening and it was back to work at 7.30am on Monday, so there was no real transition to be had. It was a case of holiday mode as is went to bed and work mode when I got up the next morning. It was just the way it had to be with three weeks off - there was no spare time to be had! So it was straight back into it, which can sometimes be the best way to get on, although I don't really feel like that the the moment! I can just about see the wood from the trees at work now, after a few days of catching up. I just wish I could say the same about everything else I do.

It's getting back into the swing of things for everyone concerned at the moment. The Summer customer flow is very different to the flow during the rest of the year, especially in a university city, such as the City of Durham that I work in regularly. So it's been a time where large parts of the city have been on holiday and where large parts if the city are starting to get back into a routine for Back To School promotions, the kids actually returning to school and the university students returning to the city.

I've been doing some work with a pharmacy in the city recently and all their work is geared to the students returning and the ailments beginning, especially when the weather turns cold. The start of term can't come quickly enough for them and their largest customer base starts getting ill not long after returning.

It's interesting to note where your largest customer groups are and how the ebb and flow to be able to plan out your staffing, stock and things such as opening hours. I've mentioned in my blog many times about organisation, and this is adding another level to your understanding of what goes on.

NOT EVERYTHING CAN BE FOUND ON THE HIGH STREET

New financial year - new start

For many of you, a new financial year will have just started. Many UK retailers have a year that follows the financial and tax years, so how has it started? What have you done differently?

Every business needs a degree of regeneration and freshness at times and a new year with all it brings is a great time to do this.

If you are an individual retailer, or reading this as a store manager for a big corporate chain, there's something about this time of year that often brings out a void in communications between the top and the bottom. And this is the exact opposite of how it should happen. Now is the time to ramp up the communication levels and get your team inspired to start the new financial year with a bang. The worst thing to do here is to wait for the analysis of the last year to happen before you kick-start the plans and motivation for the new year. I've worked in many large High Street retailers where there is this void. The new year has started but things like staffing budgets, sales targets, etc have been formally set. It just doesn't work and often leaves the stores having a poor start to the year that takes time to catch back up. So how can this be avoided?

Keep last year in focus

It's important to base this year's plans and budgets based in the performance of the previous year. But waiting to analyse the results leave a gap in the year without real impetus. The way around this is to have a grip on how you are performing all year round, with a solid idea of how you'll finish the year. This allows you to plan forward and set up the incoming year.

Ensure continuity

Keep your plans for the new year ready to move straight in at the right point. Now some of this will be having an annual plan that somewhat resembles the long-term plan, as it should. The fact that your long-term business plan has been thought out and put in place should ensure that you are not lurching from one set of objectives to another just because an arbitrary line has been reached.

Communication is key

The plans must be communicated right through the organisation, from the directors to those in the shop floor in enthusiastic, complete terms. The way that this communication is delivered and received is paramount in its potential success. Having an organisation enthused by the direction the company is going in and all working towards the same agreed, understood goals will make a huge difference to your organisation.

A little change does no harm

I've never been a fan of change for the sale of change, but a little variety in how the company performs certain tasks or how a company goes about achieving certain objectives isn't always harmful. I'm still not advocating lurching from one set of objectives to another, but I think that retail can get monotonous, and changing the way you go about achieving your long-term goals can sometimes be beneficial to your team as a whole.

This all stems down to organisation - being on top of your figures and having structured long-term goals will always put you ahead of your less-organised rivals.