The pressure is on, but when the going gets tough the tough get going, says Lord Kirkham.
When the clocks go back and the nights draw in, it is natural to reflect on the year coming to an end. One thing is for sure, 2011 won’t be going down in any history book as “uneventful”.
We’ve had earthquakes, tsunamis, mudslides, floods and a potential nuclear meltdown. We have lived through the Arab spring, an Indian summer, the autumn of the euro and are now shaping up for the mother of all winters of discontent. We’ve also seen global population records smashed, a memorable royal wedding and the last of bin Laden and Gadaffi.
The mega-changes in the world have been felt in retailing too. When did you last read a trading update that did not include the word ‘challenging’? But the undisputed pressure on consumer spending is, in my book, no excuse for pessimism and negativity.
There are now seven billion potential customers out there who all want to eat, wear clothes and enjoy themselves – and that presents some mega-opportunity for anyone with a sense of perspective.
The macro-economic environment can play a significant part in success or failure, but only if we let it. The largest fortunes in retailing, like those founded on Lidl and Walmart, were built up over time – good times and bad.
In my view bad corporate decisions floor more businesses than bad times. Difficult trading conditions simply highlight errors and weaknesses, they certainly do not create those mistakes.
Nothing is more contagious than negativity and that we should shun and leave to the media while we focus on the positive. Tough times always create opportunities and right now rents are down, incentives up, and with a million-plus young people unemployed there has never been a better time to recruit talent.
Clearly multichannel retailers are doing better than most, and perhaps we should bin the traditional cry of ‘location, location, location’ in favour of ‘web, web, web’.
While I can’t know where the specific opportunities lie in your business I do know that this is not the time to atrophy, it’s time for action. So blank the doom-mongers. Trade up, trade down, trade on the web, trade 24/7, price-match, introduce a bit of self-service, crank up the rate of innovation and change, or sooner rather than later you will be toast.
Just because governments as well as companies look set to go bust is no excuse for nailing down the hatches. Sacking the sales force and slashing the advertising budget will not take any of us forward in the long term – you can bet the farm on that.
History shows that those who take the most positive approach to challenges always end up on top, while the negative invariably go to the wall. Fortune favours the brave, and for the brave this is a great time to invest and expand, albeit with care.
Or as Marshal Foch signalled from the Marne in 1914: “My centre is giving way, my right is in retreat. Situation excellent. I shall attack.” Smile, be lucky and attack with vigour.
- Lord Kirkham is founder of DFS