nickshanagher

There is a lot of news about the performance of retailers on the television at the moment. This is positive because it means that there are fewer global disasters, wars, tax rises, scandals and terrible crimes to take up all the airtime. It is negative because it is so broad brush. For example, on the television news they talk about retailers as if they are interchangeable when in reality a food retailer and a white goods retailer operate in different worlds. Shops that sell books and DVDs and CDs face incredible pressure from internet sales. Ones that sell bread and milk do not. Local shops in the news and convenience channel face a very tough trading environment this year, perhaps more so than for some time. One leading wholesaler told me in November that trading was very, very difficult. For him this was a departure from his more usual optimism. I would speculate that the pressure from the multiple operators on the convenience channel, particularly in London and the South East...

The City analysts cannot make up their minds as to whether the supermarkets' investment in convenience stores is a good thing or not. The FT in a Monday analysis piece suggests that "Grocers count cost of smaller outlets". It is a clever headline. Obviously they are managing their costs. But also they are measuring the impact on their bottom line. There are several issues. If you sell 399 chicken dinners and have one left over, the cost model is very different from a shop where you sell nine chicken dinners and have one left over. If your 60,000 square foot hypermarket is sited where land is cheap and rates low, the cost of storing those dinners will be cheaper  than in a 3,000 square foot store in a city centre. How do the grocers try to manage the costs: 1. By clustering c-stores close together so you only need one truck to do deliveries 2. By tailoring what the stores offer to local demand and getting the stock levels correct 3. By trying to persuade shoppe...

Shopkeeping is a passion of mine, Theo Paphitis, owner of Rymans, the office supplies company and UK TV star, told an audience of leading retailers last week. The simple act of owning a store provides you with 70% of the skills of running a business, he estimates. The reason why is that running a local shop requires a huge mix of skills: people skills, stock control, merchandising, and so on. Shopkeeping is also an area where you can join with no qualifications and get to the top. Cheerleading for the retail sector is important. Retailing done well adds value to the economy. Mr Paphitas is right to say that anyone can open a shop. But to do it well you need to master a broad set of skills. The good news is that there is lots of help easily available to the local retailer prepared to make the effort to seek it out.