OK, so retail stores are closing at an alarming rate and fewer new ones are opening. Now what? The reasons have all been laid out and analysed, so there is little chance that we will discover any hidden causes that we can address in new ways. What is missing is a serious debate about what needs to be done. Like the referendum that led to Brexit, no major debate was ever really had before it was too late.
Assessing the options
Now, in retail, we are all taking sides to serve our own interests, without recognising that this is an existential crisis. If we are really watching the decline of the store as we know it, then telling retailers to accelerate their digital transformations, work more collaboratively across departments, recruit differently, give the CEO a gentle shove, procure and manage IT better, and stop moaning about all that data, may not be the answer unless all these things happen at about the same rate.
Where once we relied on politicians or legislators to bring about change, we now know that: 1. They can’t because they don’t understand retail; 2. They don’t really recognise its importance to the economy; and, 3. The solution contains so many seemingly disconnected elements that only a dictator with absolute power could bring it about.
Can retail leaders make a difference?
In our consensual, empowered, analytical, democratic age, it falls to charismatic senior management to juggle these multi-coloured, multi-sized balls and bring about change, but culture and shareholders are against it. I’ve been going on about how the CEO has to lead the charge but most are not given the environment in which to thrive. There are notable exceptions and they are currently buying up stores that most of us wouldn’t touch. I don’t want to get back to a time where we spawn another Philip Green, but we must recognise that in the early days, his hands-on, market trader skills were just what BhS deserved.
And I don’t want to hand the laurels to a new generation of alpha males either, recognising what Kate Swann did to keep WH Smith on track for so long, ruthlessly squeezing out profit year after year.
The evolution should not be a surprise
Retail is a simple business that made itself complex and has only itself to blame for the mess that so many players are in now. Consumers have been observably changing their habits for nearly 20 years now, so we can’t keep saying that change happens too quickly for us to keep up. What we have is a sector that was built for another age, no longer equipped for how we live now.
If we follow Hegel, we are at a point of synthesis that has already turned nasty for some and may hopefully be a catalyst for profound change. I want to believe in a smooth transformation, but we are likely to see more blood loss and harsh but realistic responses including pre-packs, acquisitions by some of the tougher private equity companies, and savage adjustments from stores to online.
Retail technology as a tool for survival
In my own world of promoting technology, the prizes will be won by those vendors that focus on the practical. Thought leadership is no longer an end in itself, but a door onto a world of products that are delivering value right now, can be implemented within a reasonable time period and delivered by people who are not afraid to tell you the truth of what is happening in your business.