What is the right mix of retailers on the High Street?

I'm sitting on a High Street, looking at the range of shops and wondering if the mix of shops makes the difference in the vibrancy of any High Street or town centre.

Just in my line of vision, I see a food shop, shoe shop, pet shop, pound store, pharmacy, clothes shop and a variety store. Over the street is a coffee shop, an optician, a card shop, 2 fast food shops, a bookmakers and a charity shop. It's a good mix and with ample parking and safe places to cross the road, it's a vibrant area with places to spend, eat and just stop and watch the world go by. Slightly further in the same street are 2 supermarkets, another fast food shop, a car wash, a chain pub and a DIY store.

When High Streets and town centres grow up organically to have a collection of shops that attract a range of customers, then it just works.  It's when the free market doesn't provide this vibrancy that local planners and councils need to get involved.

So how does this happen?

When there is a high demand for commercial property, then planners can look at accepting or rejecting certain uses based on the mix they already have. Landlords can look at choosing a tenant based on the longevity if their tenure as a viable business and a degree of survival of the fittest occurs to ensure the very best retailers are present.

When it doesn't happen

But we haven't been in a situation as competitive as this for several years now, so landlords will be far less choosy in their tenants. At the start of the financial meltdown, commercial landlords would probably have taken anyone who could pay the rent.

So planners have to take the lead and provide planning rules that allow diverse retailers to a High Street without penalising the landlords. This is a fine line, and planning officers have generally been quite lenient in their criteria over the last 6 years or so.

I would strongly suggest that the criteria be clearly laid out and stuck to rigidly for every application. Filling a High Street with charity shops or discounters in a downturn isn't the only way out of the downturn.

People look for bargains, look for value but the days of buying things just because they are cheap has disappeared. Customers are savvier and want something that will do the job they've bought it for.

The new smartphone from Amazon - fire phone

Have the High Street banks changed since the meltdown?

Lord Adair Turner tells policymakers to be radical in their thinking, as he analyses the current financial climate and the danger of returning to the dark days of the economic meltdown. Although a little short on detail, his speech hits the right notes in terms of discussing what exactly has happened and where we have ended up with regards the financial crisis that hit at the end of the last decade.  I would ask 2 main questions with regards this-

1. Has anything actually changed?
2. Did anything actually need to change?

I say the answers are -

1. Not really
2. Definitely

So, where do we go from here?

I think that the banking system has come full circle from fear, through self-pity and survival mode to business as usual.  The wider economy doesn't need business as usual, as small business and consumers struggle to get finance for house purchases and find they are further disenfranchised by a system that they didn't help to create, didn't ask for and now feel disengaged from.  This has gone along with repossessions, liquidations and the rapid growth of the payday loan sector.

How can this happen after the major shocks of 2008 and the fact that governments own large stakes in banks?

We are on a course for a similar shockwave of financial crashes if there isn't a change in the structure of the banks, the way they interact with customers and an acknowledgement of the errors of the past.  A whole industry has popped up to make the most out of banks errors - mortgage exit fees, bank charges, PPI miss-selling, etc and this is before the exposure of self-certification mortgages, interest-only mortgages, fasttracking of mortgage clients and others.  Banks have been subsidising high spending on cars, holidays and home improvements by the £10+ billion payouts for PPI misselling alone.

There needs to be a line in the sand drawn by the banks to gain public trust again - or maybe this has gone on too long and can never be repaired.  The public appetitie for payday loans seems to never be satisfied, so why not a Wonga Bank on the High Street?  A series of new entrants to the market that aren't tainted by the scandals of the past may be the only way forward.  Metro Bank is making progress in London, while Virgin Money seems to have escaped the association with Northern Rock.  Nationwide came out of the scandals with an enhanced reputation, as did First Direct.  M&S and Tesco are starting to offer a serious proposition in terms of everyday banking.

Is this the way forward?

The new smartphone from Amazon - fire phone

Shop Local is more than just a slogan

Why don't customers in all walks of life choose smaller, independently-owned local businesses to interact with?

Why would you get your coffee fix from a national homogenised chain when there's a local alternative available?

Local companies employ local people, are run by local people who then spend their income locally.  International companies funnel income away from your local area (often in tax avoidance schemes that deprive the UK Treasury of much-needed tax income.). The ethics of major banks, retailers and hospitality companies is regularly brought into question by their mis-selling, corporate governance and tax affairs - so why go global when you can go local?

I would urge all local independent retailers to push this fact in your marketing.

If you are local, live local, send your kids to a local school, spend locally, pay local council tax then you already have an emotional link to the area you are selling your products in and have an empathic link to your local buyers.  You must use this link to forge links with other local businesses and the larger local community.

I would suggest that you source your products from local suppliers wherever possible. If you can supply from your local community then the connection you have with your local community will be much stronger.

Can you survive without promotions or sales?

  As retailers, we work on tight margins for large parts of the year.

The time to refresh and clear out old stock comes in the sales. Traditionally an annual event, this had been pushed into 2,3 or 4 times a year, mainly by fashion retakes that want to cleanse their stockrooms of the last season's unsold items.

An alternative method, pushed by the supermarkets and beauty stores is the promotional period. Thick is where particular lines will be on a particular promotion, often BOGOF or 3 for 2.

The other, less used, method is to create a clearance section or stand in your store to rid yourself of lines that haven't sold, are short of date or you no longer stick.

Can you survive as a retailer without moving to sale, promotion or clearance?

I think that the ideal scenario would be to never have to end up with any of these situations, as your pricing strategy will determine the sales levels of your products.  Say you have a line available in 5 different colours, and 1 colour is being left behind. Well, a price drop would perhaps be a better way of selling that line through than clearance, or editing for the sales.

Some retailers rarely have a sale, some never use promotional periods, so what would be the way forward to become a retailer that stands on your own merits? Would being respected enough to have your products bought at full price all year round be desirable?

I say "yes."

And I point to independent local retailers as both the answer and the solution to this. A strong local retailer that satisfies a local demand by producing or sourcing products that people need at an attainable price should have no need for promotions of sales, but could strike deals with individual customers.

"I'll buy 2 if you knock £10 off the price"

This is a better way for an independent retailer to do business than to sale or promotion their way through stock.

There is another solution that I have mentioned regularly in my blogs - Click & Collect, where you open up your range to internet buyers and have the item ready to collect in your store.  This opens up the potential buyers, and can be used to sell nationally or overseas if the shipping costs are not too burdensome. This increases sales and allows you to clear your range more quickly.

A message to TK Maxx

Hello TK Maxx, I've spent time in one of your stores today and I have a few comments. I feel that generally the stores are good - light, easy to browse, well laid out and easy to lose track of time in. All ingredients for successful customer interaction and factors that will induce good sales.

The staff are friendly and approachable, but not at all intrusive - a good mix.

The queuing system and till area are well laid out as well, but queues can form really quickly in fashion retail, so you definitely need more staff either in or around the till areas.

One area I can see that will make an immediate improvement in your availability and sales is the processing of stock around the women's changing room area. I have noticed this in a lot of women's fashion retailers but it affects you far more than a lot of your competitors.  Your USP is the "finds" that your customers make - branded goods arriving daily at a knockdown price.  When so many of your finds are left next to the changing rooms (40+ items today on a quiet morning) then they aren't on the shop floor waiting for your customers to find them.

I would suggest a run every 15 minutes for someone to return all the items to their shop floor location.  This will increase availability and customer satisfaction.  The items that are tried in are the more popular items that others would desire.

Just a short note today, prompted by a visit.

Thanks for listening.

Audiobooks from Audible at Amazon

We're a fashion retailer - we just don't sell clothes

Paperchase chief executive Tim Meglund was quoted yesterday as saying the above quote - "we're a fashion retailer, we just don't sell clothes" about the company as they posted their annual results.

I have long believed something similar of every company - that they are all marketing companies, that market different products or services.

• An estate agent is a company that markets properties
• A retailer is a company that markets their own or someone else's products
• A manufacturer is a company that markets it's products to retailers and consumers

For me, that is the raisin d'être of every company - to raise demand for their product or service by marketing.

What does this mean for me

You have a couple of options, depending on the type of products you sell.

If they are made by you, then you need a marketing campaign to raise awareness and demand. You can use a local marketing consultancy, usually at a reasonable cost, or go it alone. Social media, word of mouth, offering incentives, local radio or newspaper advertising, handing out leaflets - the list goes on and on. You will know what us a good fit for your business.

If the products are made by a larger manufacturer (and I'm talking the real big boys) then you have a reliance in the fact that these big boys will be spending money on advertising already. You can mirror their advertising with your promotions. For example, if Plenty kitchen towels are putting out TV adverts, newspaper adverts and a social media campaign (as they are now) then this is a good time for Plenty to be highly visible to your customers, and perhaps offered on a promotion. Again, you will know how best to make this work for your customers, from a choice of the options above.

So, don't just think of yourself as a retailer - there's a little fashion retailer and a little marketer in all of us.

Not everything can be bought on the High Street - MP3 version of NOW That's What I Call 21st Century

Ensure your team know exactly what you expect from them

As the title says, I urge you to let your team know exactly your expectations if them day-in, day-out. As a leader you should have a clear plan of your goals and ambitions for the store you are running and ALL of your team should know 1- what these are, and 2- how you will achieve them.

This should be brought about by taking several steps-

• Decide what exactly it is that you want to achieve
• Work out basic steps to get there
• Plan an overview meeting with your team at the outset to communicate the above
• Have regular progress discussions to keep your team informed and keep their actions on-track
• Have daily discussions with team members regarding their input into the longer term goals

Leadership style

For the good managers, this may seem quite basic, but it doesn't happen in a lot of retail environments. Your ability to clearly communicate what you want your team to do and how you want them to do it is the very basis of your motivating management style.  A stranger should be able to walk into your store and ask every one of your team what your expectations are and get the same answer.  Now ask yourself - is this true if you and your team?  If not, then please take a loom at the steps outlined above and work through them in order.  It will make you think about your business, your goals and your leadership style.  The right results will only come if everyone is working together to achieve them.

Adapting this style

Once you have this as an ongoing part of your team's day, as in working towards these goals, then the next step or adaptation is to get your team to have a greater input into the goals.  They can challenge you and each other and this, in turn, empowers them to inspire each other.  Taking on these challenges and taking risks within a supportive framework make the job more interesting and make the team more likely to grow together and stay together. The working relationship between your team is vital to the vibrancy if your offering to customers.  Anything you can do to nourish that is taking a massive stride forward.

Tesco sales drop is about more than price

I'm just reading about Tesco's figures and the fact that their sales dropped by 3.1% over the last quarter - the biggest drop since records began in 1984.

My wife and I were in Tesco yesterday and the problems became more obvious to me as we sat in the café overlooking the store.

The problem is that they get nothing right

Now this isn't an anti-Tesco rant. It's true. Look at the facts-

• They don't do quality as well as Waitrose
• They don't advertise as well as M&S
• They don't do cheap as well as Aldi
• They don't do mobiles as well as Carphone Warehouse
• They don't do cafés as well as Costa
• They don't do toys as well as Smyths
• They don't do tech as well as, well anyone really

This adds up to a poor showing overall. The growth of Tesco has come from the "all under one roof" philosophy but this has come at a price to consumers. The reality of the philosophy is "all in one place, but only 60% as good as if you bought it elsewhere."  The idea of training staff up to be as good as their competitors in each field wpuld take a huge investment. The model of the department store, with market leaders delivering each sector, stands up better than Tesco's current plan.

It is my belief that consumers in the UK tolerate standards that would be unacceptable elsewhere in the World.  For example, I conduct mystery shopping programmes for some major restaurant chains and the question regarding food quality is "was the food rancid or spoiled in flavour?"  Now is this a standard we find acceptable?  In most European countries poor restaurants close because people won't pay good money for something below par.

It's the same with Tesco - customers are starting to find them out. Why pay higher prices for less-informed service on technology? Why buy their Finest range when, for a comparable price, you can buy M&S?

There is a bottom ground for discounters and there are already a few in the market. Why are Morrisons rushing for the lowest price ground? Why are analysts urging Tesco to join them?

A company that ploughed some of their vast profits back into a living wage for their staff, more staff available for customers and a higher standard of service would win every time.

Not everything can be bought on the High Street - MP3 version of The Hunting Party by Linkin Park on pre-order