The first step in resolving a problem is recognising that you have one. Surely by now there cannot be any sane retailers that are still in denial about the grim trading portents and dearth of business, letting us quickly move on to what we can do about it.
Clearly, we can’t all shift down into pawnbroking, cheque-cashing or value entry-level products. At the other end of the market, there are limits to the amounts that even our Russian friends can spend on art, flawless diamonds, 100m motor yachts and Gulfstream aircraft. So, if upwards diversification isn’t the answer, how can we hope to beat the downturn?
We can do the obvious like reviewing staffing levels and capex, and smartening up the operation generally. We can even reshape our businesses to cope with a temporary reduction in activity and ask our landlords nicely if we can pay our rents monthly in advance, rather than quarterly.
The real problem, however, lies elsewhere. The consumer is punch-drunk with the drip, drip of bad news, dejected and despondent with no confidence in the future and that puts the brakes, handbrake, footbrake and chocks on any serious spending. Feelgood has become feelbad.
It is not within retailers’ power to cut the price of petrol or diesel for consumers’ cars, food, or energy bills. Nor can we easily counter the inflationary effects of a declining currency. We are retailers – not the Government.
While we can’t muzzle the Chancellor of the Exchequer, surely we can do something collectively to stop the media talking ad nauseam about falling house prices, negative equity, mounting debts, the collapse of the banking system and unemployment.
Our customer, like the rabbit in the headlights, is terrified and his wallet has atrophied in sympathy. There will be no consumer commitment to any deferrable spend in this environment.
This non-stop, grim torrent of propaganda is making a bad situation dire. Pessimism has overtaken realism for our news spinners and even our unprecedented Olympic successes could not reverse the tide.
We in retailing need business, and what an opportunity that presents for the customer. It truly is a buyers’ market and surely there has never been a better time for the consumer to strike an unrepeatable deal?
Let’s inject a bit of optimism into the promotion of our businesses and, when we are talking to the media, get some focus on the bright side. In the words of the old Bing Crosby song, let’s “accentuate the positive and eliminate the negative”. And if we can’t smile, we should give up shopkeeping and try bereavement counselling.
Yes, things are tougher than they have been for a bit and some weaker players will go to the wall. But there is no sense in talking opportunity down while driving ourselves into the floor by fighting furiously for what business there is at no margin.
Remember that we have lived through hard times before. They will pass, as they always have done. In the meantime, be upbeat and reassuring, sell the dream and keep whistling a happy tune.
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