As a lifelong art collector, I have learnt a lot about the importance of perspective – something that has stood me in good stead as a retailer.
In our industry, understanding the relative importance of things is vital if you have a preference for staying sane.
So ask yourself: has our retail world, with its decades of investment in brand-building and goodwill, really collapsed in ruins because Christmas like-for-likes at M&S and Tesco fell a little bit short of the City’s teenage scribblers’ expectations?
A designer friend bought me a decorative glass sphere for Christmas. It resembles Gypsy Rosa Lee’s fortune-telling crystal ball. However, I don’t think we need any special magical powers to predict falling retail like-for-likes and growing profit warnings in an environment where all indicators are negative, unless you work in the insolvency business.
We’ve been spoilt for too long, benefiting from strong consumer demand fuelled much less by our retailing skills than by unsustainable house price inflation and easy credit. Yet, even so, if your business is built on firm foundations it should not fold when the climate changes a bit and the balmy breeze becomes a stiff wind.
As the storm clouds gather, the best-placed retailers are those who have really cared for their customers, because that past investment in staff training and customer service is better than hoarding gold when the going gets tough. That’s when accumulated goodwill and the recommendation of satisfied customers help us defy the cycle and protect against the burning desire to slash margins, sack the sales force and make desperate panic-driven offers.
Of course, it may be a tad late for some to start down that road now. You really should have been paying more attention to these columns before the wind changed. But if your business can’t stand a bit of a downturn, then perhaps you shouldn’t be in business. And, to look on the bright side, maybe you won’t be anyway pretty soon and then your like-for-likes won’t matter a toss.
Which brings me back to the importance of perspective. Let us get a grip and panic not, remembering that it is, after all, only money. Even if your business folds and you’re out of a job, the Porsche gets repossessed, your gym membership is cancelled and the nanny has to be put on the plane back to Krakow, living in the UK means that you’re still among the richest and luckiest 5 per cent of people on this planet.
We’ve seen no sign of a tsunami or earthquake in South Yorkshire for quite some time and even under this Government I’m quite sanguine about avoiding death by starvation, bubonic plague, torture or civil war.
So, let us be grateful that all we face is a dip in like-for-likes – a bit of a slump. Let’s remember that there are many fates worse than a surge in oil and food prices, or the weakness of Sterling, and delight in the fact that we are living in NHS DSS Britain and not just about anywhere else in the geographical alphabet, from Afghanistan to Zimbabwe.
Lord Kirkham is chairman of DFS.
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