Q&A: Topps Tiles boss Matt Williams on the weather, the Budget and adventurous homemakers

How is the cold weather affecting Topps Tiles?

The key thing for us is can people get to the store? I don’t think people are being put off tile projects. The weather in the second quarter didn’t help but there was something else going on there, the consumer stepped back.

Will the plan to stimulate housing transactions announced in the Budget help Topps?

The devil will be in the detail. But anything that helps the housing market will help us, and the general economy. Housing transactions have fallen off a cliff from 2007 when they were 1.7 million. They stepped back to circa 800,000 in 2008 and have since crept back to around 930,000, still well below the 2007 peak and longer term average of  1.2 to 1.3 million. So Government’s intention of getting the housing market going is good.

What’s your outlook for 2013?

Good. The first quarter was strong, second quarter not so. We’re still confident we can come in where we need to on profits. But it’s a tough market, and nothing has changed on consumer confidence, disposable income or housing transactions. But there’s an element of ‘life goes on’. Confidence is key.

You shut down the Holland business in 2010. Are there any plans to launch overseas again?

Am I chomping at the bit to go abroad? Not at the moment. But we’re the biggest tile specialist in the world and on that basis we wouldn’t discount it, but currently there are no plans.

How important is the trade side of the business?

The trade makes up 45% of the business, and that’s growing. The trade come in multiple times a week but a retail customer will come in once every seven years or so. But we couldn’t do without either, and it’s a difficult balance to strike. We just see trade as a different channel to the same market.

What trends are you noticing in terms of products?

We went in to 2008 thinking people will be after pale, boring and cheap product, but people are being more and more adventurous. People are saying ‘how do I make my home somewhere I want to live?’ We’re trying to address the impression we’re cheap and cheerful and nothing else. We’ve got something for everyone. The product lab is fizzing with excitement.

Customer service is core to your offer. How important is staff training?

Specialist knowledge and customer service are two key areas that set us apart, so we naturally spend a lot of time training and developing. We have an adult apprenticeship scheme which half our store colleagues have completed. We also do face to face training and employ various initiatives to engage our people in the business strategy, ranging from store manager roadshows to in-house broadcasts. 

What kind of stores do you favour?

We’re like the Majestic Wine of tiles in term of property. We like quite quirky places, we’ll take educated compromises. Our heartlands are in London and Manchester but we do well in small market towns too. We’re pushing into London and the south east, but not exclusively so. The performance of stores in the south and in and around London is strong, it’s linked to house prices. Where house prices are rising you’ve usually got a growing tiles market.

Our average lease term is eight years so an eighth of the estate is up for renewal every year which gives us flexibility. But I can count on one hand the number of store I’d like to give back to landlords.

How are you aligning the online arm with the stores?

98% of our business is done through stores and 2% online, half of which are collected in store. More than 70% of our customers have been online before a purchase. We’re aligning stores and online and fulfill all our web orders through our stores. A year ago online orders were delivered centrally.

How are the new format ‘lab stores’ performing?

Milton Keynes is performing very well. We’ve opened three more in the new format in Hounslow, Dorchester and York. We’re taking elements of the first lab store and rolling them out across the estate by the end of the year, such as the Inspiration Station.