Trading prospects don’t look bright, but there are ways to ease the pain, says Ian Cheshire

After a tough 2010, ending with arctic conditions and a VAT increase, most UK retailers probably look to the new year with a Bob Dylan-style premonition that a hard rain’s gonna fall.

But although the coming year will no doubt be difficult, I believe that there are some reasons to be cheerful, or at least hopeful. So as it’s traditional at this time of the year to make new year resolutions, here are my retail resolutions for 2011.

l Innovate. I have made this point before but recent experience continues to show that,even in a downturn, consumers will spend their cash if a product or service is genuinely innovative. It is certainly no surprise that some of this year’s Christmas best-sellers include the Apple iPad, the Xbox Kinect and e-readers such as Kindle.

Yes, the success of these products is significantly due to better technology, but it’s mostly about convenience and ease of use.

It is a theme that we are trying to emulate at Kingfisher with B&Q’s ‘Making it Easier’ marketing campaign and Castorama’s ‘C’est Castoche’ campaign in France where we try to simplify products and make home improvement projects easier to do.

We have seen strong sales where we’ve done this, such as with wallpaper where the paste is applied to the wall rather than the paper, and pop-up, pre-lit Christmas trees.

  • Help sustainability go mass-market. This trend is going to happen anyway, so forward-thinking retailers should get ahead of the curve or risk being left behind.

    Governments are beginning to act, with progress at Cancun and the UK Government’s recently announced ‘Green Deal’ marking an important step forward.

    Big corporations are on the move, with continuing successes such as Marks & Spencer’s Plan A, as well as initiatives such as Unilever’s Sustainable Living plan.

    At Kingfisher we have seen significant progress made in areas such as energy efficiency and timber sourcing. Momentum is building as governments need to mobilise consumers to be greener in order to meet emissions targets, consumers want to be greener in order to save money on energy bills and companies have to be greener to meet their customers’ expectations and those of other stakeholders. This self-reinforcing cycle is taking sustainability forward at pace, and opportunities for retailers will follow.
  • Hang on in there. I expect the first half of 2011 to be particularly tough for UK retailers as tax rises and spending cuts hit home.

    But the trends will gradually improve as the year progresses and there should come a tipping point during 2011 when consumers will feel that the worst is over and they can think about spending again.

    Because of that, I feel more confident now about 2012. To close with the words of another Dylan song, “the times they are a-changing”.

Ian Cheshire is chief executive of Kingfisher