Independent retailers need to change their business model to survive, but surprisingly few seem convinced of the role that sales training can play in helping them operate more efficiently in a competitive marketplace, says T21 managing director Paul Laville
The ERT Turning Point Summit was the second of two conferences I attended in as many days at the start of February. The first was the Annual Clarity Conference, at which I learned a new word: disintermediation.
It means ‘cutting out the middle man’, and it arose following a presentation by Google, which showed how and why online systems are getting slicker at moving the customer through an increasingly fluid shopping journey.
Following the presentation, a voice from the audience blasted Google for enabling the ‘disintermediation of the retailer in the customer journey’. “What happens to us?” was the question that followed. “Are bricks-and-mortar retailers in danger?”
Cut to the ERT Turning Point Summit 24 hours later, and a line from ERT’s mission statement resonated with what I’d heard the day before: “The brutal truth is that independents are a dying breed and if we’re not careful, they could soon become extinct.”
Well, it was a doomy start to the day and no mistake. The figures from GfK showed that for the full year 2010 the independent sector represented a 20 per cent value share of CE sales. If memory serves, even that figure was a sharp decline from 2005, but the real shocker was that for the full year 2016, that share had reduced to just nine per cent. Moving in the opposite direction was the growth of the generalist retailer. Tesco had opened another 1,000+ stores in the same period and a chunk of them were selling CE products.
Clearly, the decision-makers within independent retail businesses are struggling to attract and retain customers in the face of a market moving rapidly away from their traditional business model. They need to decide either to change that model or shut it down. It’s really that simple, and well done to ERT for setting out an agenda that addressed this.
The results of the day should start to indicate what kind of business plans will need to be drawn up by the various concerned parties, and once that’s done each business will need to develop a strategy that allows it to realise that plan.
Like ERT, we at T21 have a perspective on the industry free of affiliation to any single brand or retailer. We work with manufacturers, trade associations, distributors and retailers alike, and what we do is we help businesses implement change.
Whether it’s to your skill set, your attitude, your knowledge, your business operations, planning, structure and strategy, ultimately ‘training’ enables positive change to your business. Sales training, for example, enables your sales team to sell more profitably, while improving your customer service, business skills training helps you operate more efficiently and competitively in a crowded market, reach new customers and so on.
I was heartened to hear Ed Griffiths of Purewell Electrical in Christchurch mention the need for ‘salesmanship’ training in his stores, and I talked to a few others in the coffee break afterwards who shared his opinion. But, on the other hand, I’ve encountered a far greater degree of apathy and suspicion when it comes to trying to convince independent retailers to invest in sales training.
In fairness, it’s hardly surprising, since, with the exception of a few sole champions, sales training within this industry has been poorly served. But this was why I set up T21 in the first place. This industry is my passion – and not just me. Everyone at T21 has been involved in it for most of their working lives, whether in retail or as a manufacturer, in sales, training, new business development and commercial operations, both on the shopfloor and at board level, and none of us want to see the electrical retail industry collapse.
It won’t, as a whole, of course, but why be a casualty, if all you have to do is change your traditional business model? Or is that too difficult? Too many shops, too many contracts, too many structures that would take years to shift gears. Too costly?
Instead of thinking about the cost of change, ask yourself what is the cost of not changing, and what are the gains if you do?
For me, Robert Hughes nailed it at the Turning Point Summit.
He was the first guest (90 minutes in) to mention ‘the customer’ and I’ll echo his words with an irrevocable truth: whether you’re a retailer with one shop or 1,000 shops, whether you’re a manufacturer with a powerful brand, a specialist distributor, or even an honest training company forging ahead, unless you stay relevant to your customers, you do not have a business.