Beneath the debates over when the recession is going to end, whether shoppers will come out for Christmas, and how bad 2010 will be, there’s a quiet revolution going on in non-food retail.
All are one-offs at present, but that doesn’t mean they’re not important. Far from it – what each shows is how retailers are experimenting as they adjust to the changed market conditions and ready themselves for the recovery.
Take John Lewis for example. The collapse in the property development market means there’s no way it can grow by opening stores in new shopping centres, as had been the intention. Its new John Lewis at home out-of-town format gives it a new avenue for that growth.
HMV chief executive Simon Fox knows selling CDs and DVDs won’t be enough to build a sustainable future for HMV, so the cinema is one of a raft of initiatives to ensure the retailer can meet all its customers’ entertainment needs.
Meanwhile DSGi is experimenting with its store formats and its portfolio of brands in a bid to meet the needs of customers in today’s world of technological convergence, which should sharpen its act ahead of Best Buy’s arrival.
In a recession, it’s easy to put your head down and focus on day to day tactics, particularly when, like HMV and DSGi, your business faces structural challenges. But these examples and many others show how today’s well-run retailers are using the opportunities that come out of adversity to prepare their business for the future.
Waterstone’s will win out
HMV might be getting itself into shape, but stablemate Waterstone’s is having a tough time as its central distribution warehouse takes time to settle down. There’s a lot of indignation among the famously precious people in the book world about the chain’s difficulty in fulfilling orders.
But the problems need to be kept in perspective. No big supply chain move has ever been without teething troubles, and there’s no doubt the old system, of stores ordering directly from publishers, wasn’t going to be right for Waterstone’s in the modern age.
The reality is the book community needs to back Waterstone’s, not gang up on it. As specialist multiple booksellers go, it’s the only show in town these days.