Service revolution

Davies believes customer service is crucial to growing profitable revenue in the medium and long-term.

Halfords wants to be a specialist in its field but needs to improve its proposition after it found that the service across its store estate was inconsistent. The retailer also said its Net Promoter Score, which assess the likelihood of customers recommending services to others, was close to that of a value retailer, which do not focus on service quality, until very recently.

To overhaul its customer service offer the retailer is opening Halfords Academies to provide the “training that colleagues need” and it is launching a qualification programme called 3-Gears, which trains and rewards the Halfords teams to serve customers.

Halfords is also changing its recruitment programme and adapting contracted hours and rotas to free-up staff to interact with customers more.

It is providing hand-held scanners to keep better control of stock to ensure products are available for customers.

The H Factor

Davies’ new phrase refers to Halfords reasserting its proposition authority. It aims to do this through better product development and design, stronger value and better space allocation, to enable growth opportunities in new and existing ranges. By the end of the summer, Halfords aims to have shifted the category layout of 100 stores.

It will also focus on the core Auto and Cycling categories, while searching for more innovative products to sell in-store.

Halfords will install electronic diagnostic terminals to every store to allow Halfords to reset a car’s electronic system after working on the battery of modern stop-start cars. According to Halfords, this is something no other retailer is doing on such a large scale.

It will also build on the momentum of last year’s summer of sport by making it the ‘Year of the Cycle’ at Halfords. It aims to bolster the cycle offer with new, exclusive products and by partnering with Team Sky as their technical partner for Sky Rides bike rides across the country.

The launch of its new 15,000 cycling parts, accessories and clothing lines also launches this month.

Stores fit to shop

Halfords has a large store estate, totalling 466 shops. Many observers have suggested store closures may be necessary for the retailer to survive as online retailing becomes more popular but Halfords is not planning any closures.

However it does want to resize stores and continue to open more sites in Greater London, where it is under-represented.

Davies is also planning to transform the look and feel of the stores. The retailer will invest £50m in refurbishing 150 stores over the next three years. He believes: “Much of our estate is no longer at an acceptable standard of presentation and significantly lags behind our customers’ expectations, especially cyclists, where a fresh and modern store environment is so important.”

He will launch his new store design at three sites – York, Coventry and Evesham – by the end of the summer. He said it offers a more coherent customer journey, more live displays and will bring the cycle repair and Wefit offer to the fore.

Davies is scrapping the three lab stores Halfords used last year to trial new designs for the retailer. He said “there are some very positive learnings but overall we don’t believe the design is right for roll out”.

21^st century infrastructure

Over the next three years Halfords will invest £38m in improving its IT and digital plans, to ensure IT systems keep up with business growth.

Halfords has reorganised its supply chain around a central distribution centre in Coventry and a specialised cycle centre in Redditch. It now aims to focus on improving its supply chain to support customer service.

Halfords is trialling air-lock deliveries, when stock is delivered overnight to enable store staff to work on it before the shop opens.

Click with the digital future

Halfords is designing a new website that is centred around its three strategic aims - supporting drivers of every car, inspiring cyclists of every age and equipping families for their leisure time - so customers can shop easily in dedicated product zones. It will be optimised for mobile devices, as they currently account for 24% of its online sales and this is expected to double in the “next few years”. Halfords will also develop communication features such as live chat, “integrated dynamic content”and help pages.

The redesign followed a digital review which found that the website did not provide a good enough customer service experience.

Halfords is also working to improve its online fulfilment, particularly for reserve-and-collect orders, stock availability and returns.