nickshanagher

Most people I met this week said that things were going to get worse before they got better. Knowing this, some were optimistic about the prospects for their businesses. This is because they had cut costs where possible and put up prices where possible. Miles and miles away in Cincinatti, headquarters of Procter & Gamble, which makes everything from Pampers nappies to Pringles crisps and from Duracell batteries to Gillette shaving foam, the strategy of cutting costs and pushing up prices had helped it report better than expected sales. However, its chief financial officer, Jon Moeller, says that the big question is whether the market will grow or not - "And you can take both sides of the argument." His concern is that unemployment is still going up. For local shops in the UK, local employment is a key driver of how optimistic you can be. Howard Davies, writing in Management Today, complains that he cannot find a builder to refurbish his east wing. "I thought builders...

The Financial Times this week contrasted the success of Costa Coffee in opening its 1,000th UK coffee shop and the failure of Starbucks, which is due to shut 30 outlets, and quotes analysts who say that the secret was in getting the marketing message correct. While Starbucks were telling shoppers that "summer's back", Costa was saying "Try our great value lunch, £4.95 for a sandwich and any drink"! However, the report goes on to say that all the chains may face a threat from "edgier" independent operators in the UK market as shoppers look for something new. This suggests that many coffee shop regulars are making a statement about themselves in choosing what they drink and where they are seen to drink it. (If fashion is so important it may also explain why 54% of shoppers think coffee is overpriced.) For the local shop, the continued strength of these chains with their "overpriced" coffee, must mean an opportunity to offer good drinks at a...

Local retailers may have some sympathy with independent operators of tied pubs, where the publican has to buy beer at prices set by the company from whom they have leased their business, after government regulators decided not to change their industry. CAMRA, a consumer group with more than 100,000 beer drinking members, had complained to the Office of Fair Trading that the market was rigged against their interests, pointing at the way that tied pubs were controlled. The OFT, in finding against CAMRA's complaint, in part used the Alan Greenspan defence that it thought pub-owning companies would not operate strategies that would compromise its commercial position. If it was not true for Wall Street banks, must it be true for pubcos? At the same time, in the USA, the American Booksellers Association has written to the government asking for it to investigate predatory pricing by Walmart, Target and Amazon. New hardback best sellers listed at $25 to $35 are being sold at $8.98 to $9...

Sales of sandwiches and coffee continue to rise and news this week that Greggs, the bakery chain, plans to open 600 new stores at the rate of more than one a week from next year demonstrates confidence in consumer demand. Interestingly, the stock exchange listed company says it will fund the £300m it expects to spend on expansion out of its cashflow! It is a useful reminder to c-store and newsagent operators to check that they are not neglecting local demand. Coffee sales, in particular, offer attractive margins and are easy to provide.

Warm weather in September and promotions by high street retailers slowed the growth of on line sales to a record low of 1.4% in that month, says IMRG, the body that represents on line retailers. On-line retailers are also braced for problems because of strike action by postal workers and six out of 10 say that shoppers have already called them to ask if deliveries would be affected. However, experts are confident that the pressure will only be temporary and that on-line sales will start to rise again. Local retailers should keep tabs on what is going on in the e-tail world and use this information to keep their local chamber of trade an politicians on their toes. It used to be said that retailers were poorly served by their politicians because you could not expert their jobs out of the local area. With the internet, that no longer holds true. Around 65% of UK households have access to the internet and the Royal Mail (yes, it's them) say that 62% of the population shop from home...

This week's news that Tesco has opened its first store with no checkout staff might be the start of a revolution - or it might not. Budget airlines get passengers to do much of the work by moving ticketing on line and making the traveller upload his or her passport details and so on into the system. For the customer, there are benefits to knowing that you are checked in and have a seat before you travel to the airport. My experience of using staff-free tills is that the shopper has to make the effort to line up the barcodes (or find them in some cases) and the shopper has to resolve the issues when the machine beeps and does nothing. In return there does not seem to be much benefit to the shopper and lots for the shop owner. While some locations may suit this depersonalisation of the shopping experience, independent retailers would probably welcome its widespread deployment as a chance to differentiate the local shop and its high service ethic.

Earlier this week I suggested that badges with positive messages could help local retailers to build relationships with shoppers in store. Today, I came face to face with a badge that out of context might hurt a brand. At a London bus stop an employee of the Pret-A-Manger sandwich chain was waiting, carrying a bag full of sandwiches and wearing a smart jacket with a slogan saying that his firm Delivers. On his cap, he wore a huge badge with the single word trainee on the top. Two ideas crept into my mind. First, if you had paid for some top quality sandwiches to be delivered, surely you were not expecting them to be delivered by bus. Secondly, what was he training in? Catching a bus? Making a delivery? Your marketing needs to be thought through. If you are going to get your staff to wear a trainee badge, then you need to ensure that they appear to be training in a skill that will be of value to the consumer. A trainee behind the delicatessan counter makes sense. A trainee sand...

I was in the House of Commons yesterday as just under 100 local retailers attempted to persuade their MPs to vote against the tobacco display ban, legislation that may impact on their shops in the future. Outside the House, they had been wearing t-shirts to promote their businesses. Inside, the dress code meant they needed to revert to using label badges. The message was simple: I love my shop! While the main business was persuasion - and there was a lot of talking - this simple visual symbol kept on popping into view. When I left, one of my strongest impressions was that these retailers cared about their businesses and they had taken the time to come to London to tell MPs they cared about their businesses. I am confident the stickers will have made an impression on MPs. Using similar labels in your business will work too! People do respond to what they see. Are you missing a trick in your shop.

Good market traders are great retailers and reading about them is always worthwhile, as an article by Olvier Bennett in the October issue of Management Today shows. Sent by his magazine to find out what life behind a market stall is like, Mr Bennett identifies lots of interesting ideas, three of which I will share while recommending that you look up the article. The market stall is run by Kent farmer Heidi Fermor and her major promotion is on apples. These are placed upfront with one bag for £1.50, two for £2.50 and three for £3. "She routinely asks the punters if they'd like two..." notes Mr Bennett, who admits by the end of the day he is copying her! She also teaches him that you have three seconds to get a potential customer's attention. "I'm always catching people's eyes," she tells him. Finally, Mr Bennett is sent off to the local Sainsbury's to check prices. It works, he says. Back at the stall a shopper baulks at the carrots, priced £...

I will shortly be blogging on the betterretailing.com website instead of here. Location may be important on the web as it is in retail! Please have a look at the new site and let us know what you think. A few weeks ago I wrote a note about Donald Fisher, who founded The Gap with his wife. Mr Fisher always claimed, says an obituary, to be a property man and not a retailer. His first shop was located not in an established shopping district but between two colleges, it says. A decision that ensured his shop would have footfall, the oxygen of retailing.

Reports last week say that Walmart has cut the prices on 100 popular toys to below $10 as they expect US shoppers to put a value-for-money focus on Christmas presents. Three multiples, the other two are Target and Toys R Us, determine what happens in the toy market and the major suppliers are ensuring that most of their toys are priced at less than $30. In the UK this week, Tesco talked up the optimism of shoppers and Sainsbury talked the optimism down. We have become accustomed to taking a lead from across the Atlantic and it appears that retailers who get the "value for money" proposition right can make some money.

From January, Asda promises to open its first ever glass-walled store giving shoppers "access to areas not normally seen". It is putting cameras into its suppliers' production areas, including a dairy farm and a carrot processing plant. This clearly reflects Asda's view of what tomorrow's shopper wants to know about the provenance of things that it sells. For local retailers, the challenge is to be able to tell people about where their tinned tuna comes from, how local their eggs are, and what the traffic lights on a packet of sweets mean. When was the last time that you audited what you sell and tested your team on how much they know about the products you sell? If it was longer than six months ago, then you should plan for a review soon.

The owners of B&Q are talking up how they have cut the price of a store refit from £2.5m to £1m by using wood-effect vinyl instead of wood and painted MDF backboards for displays. Managers are learning to live with grey shelving instead of a warmer-looking cream. Shoppers notice the produce, not the fixtures, suggests one executive. Up to a point! Most local retailers will extract the maximum possible life from their fixtures, sometimes taking too long to change equipment that has become tired. As in all business, it is getting the balance right. Shops need to be refreshed and with a purpose.

Most of the time, we felt quite happy with our negotiations with shopkeepers in the souks of Marrakech but we did feel caught out by Tariq, the herbalist. His cousin Ali had accosted us while we were negotiating a back alley looking for a tourist attraction and after taking us there asked us if we wanted to see the spice market. We agreed and half way down the street we were suddenly introduced to Tariq. Tariq had excellent English and pointing at the brightly coloured displays outside his shop, he identified them to my wife and myself. It was quite educational and he explained how various compounds were used. Then we were invited into his shop and offered tea and given an explanation of the contents of lots of jars on the shelves. This is probably what life was like before goods were packaged and organised within categories. We were bedazzled. Then moving to the sell part of the transaction, Tariq presented my wife with a small gift and then asked what we would like to buy. At ...

I am briefly in Marrakech and the price of most things varies. There is a tourist price and there is a local price and you have to bargain hard, which takes time and adds purpose to the transaction. What is clear is that for most local people this is not a time poor society. If you can spend all day discussing the price of some oranges, because there are more sellers than buyers, then you are prepared to chance your arm with a fresh faced visitor. The quality of retailing, within these parameters, is good. Abundant service, lots of validation, lots of charm. We can learn from their energy.