A few years ago sales at Argos started to decline, so the retailer hired a consultancy to tell it where it was going wrong.
After lots of studies and surveys, the consultants no doubt produced a significant report with lots of beautiful graphs.
They also no doubt charged lots of money and their recommendation was that Argos should reposition itself as more of an ‘internet’ business.
Argos had simply failed to pivot its business and fallen behind the likes of Amazon.
But why did Argos need consultants to tell them something so obvious? I could have told them the same thing for a fiver. The Argos staff could probably have told them the same thing for free.
They would have told directors “more and more of our customers are buying things on the internet, and our website is useless”. But maybe nobody asked the colleagues. Never mind.
When I heard about Sainsbury’s interest in Argos, my first question was simply why?
Everyone I’ve asked has also said the same thing: “Why?” Nobody seems to be able to figure out why. I’ve heard commentators on the TV saying it’s because supermarkets have too much space and because of an increase in click-and-collect.
But if that’s the case, does Sainsbury’s need to spend billions to fix these problems? I don’t think so. Maybe the chief executive of Sainsbury’s should ask a few checkout operators what they think.
‘Maybe the chief executive of Sainsbury’s should ask a few checkout operators what they think’
It’s not embarrassing to say, “I don’t get it”. There’s nothing wrong with saying, “I’m not falling into the emperor’s new clothes syndrome”.
The Argos deal would give Sainsbury’s lots of instant revenue along with lots and lots of instant headaches. So what could it do?
Sainsbury’s could decide what it likes about Argos and just copy it? Just focus on the good bits and copy them. And it could copy good bits from other internet companies (Amazon) and other businesses like Argos at home and abroad. They could also poach people from Argos and elsewhere.
So what’s the problem? The problem is that people don’t like to listen. Retailers are not always good at listening. For example, I enjoy watching Gogglebox, a TV programme about people watching TV programmes, a programme that sounds stupid on paper.
I imagine I would have been shown the door if I had told a retailer about my good idea that needed funding. And I would have hated to have been the first person to have suggested to the supermarkets that they should sell ice cubes.
‘If I’d come up with an idea such as Gogglebox or ice cubes, would retailers have listened?’
My advice to Sainsbury’s and others is listen to the shopfloor staff, they will offer invaluable advice.
If I’d come up with an idea such as Gogglebox or ice cubes, would retailers have listened?
I’m in the legal business these days and supermarkets should be selling legal services. It’s like selling insurance and financial products.
It’s obvious, but they won’t listen.
Advisors are going to do well out of this deal.
- Ajaz Ahmed launched Freeserve and is the founder of Legal365.com