A retailer can access 50 per cent of the UK population with just 90 shops, compared to 200 in the 1970s.
OBSERVATIONS OF A TOY INDUSTRY SURVIVOR Jon Salisbury
Why modern old-fashioned toy retailing is winning out is our columnist’s focus this month…
RETAIL CLOSURES in recent years have, mostly, been attributed to tough economic times. Last month, it was Mothercare’s turn, announcing the closure of another tranche of stores, mostly Early Learning Centres. But is their situation just a sign of changing times or management taking a wrong turn about their toy offering rather than hitting dire straights? Most ELC stores are to close in the next three years. Some 59 ELC shops have already closed in the past year, and a further 75 outlets will close by 2015, leaving just 27 in operation. Little wonder that Peterkin is to flog ELC gear to indies to try and retain a High Street presence. Chairman Alan Parker had already stated that he wanted a portfolio of just 200 profitable Mothercare outlets, so there was no real shock when he confirmed the closures. Parker says that even with its smaller store count, the UK population should be within a 30-minute journey of a Mothercare store.
Intent Media is a member of the Periodical Publishers Associations
JUNE 2012
The number of stores a retailer needs to have national coverage in a multichannel age has been the subject of regular debate. Research from retail real estate advisors CBRE suggested that store groups can access 50 per cent of the UK population with just 90 shops, compared to 200 in the 1970s. The Entertainer now has 67 stores and boss Gary Grant thinks that there is a much greater opportunity for his retail concept beyond CBRE’s calculation because of what he calls his chain’s image of “modern old fashioned toy retailing”.
As Duncan Grant, The Entertainer’s
multi-channel director, said: “The internet has made price more transparent and also allowed low-cost operators to reach a wider market. That has put specialists like us under pressure to really differentiate ourselves and add value to a customer’s experience.” “The internet gives us greater access to a wider customer base, but there is much more to selling toys than just the box and the
ToyNews is published 12 times a year by Intent Media ~ Saxon House, 6a St. Andrew Street, Hertford, Hertfordshire SG14 1JA Fax: +44 (0)1992 535648
price,” adds Gary Grant. That said, The Entertainer is investing heavily to provide a quality service from its web operations, TheToyShop.com, and Grant was able to enthusiastically confirm that some postal codes would soon be able to receive their orders within a blistering 90 minutes. Mothercare says it wants to be as efficient with its online business as Amazon, but not even the mighty Amazon will be able to beat a certain specialist toy chain’s delivery capabilities in future and not everyone was convinced of the new strategy. Says Peter Smedley, a Charles Stanley analyst: “We believe the turnaround may well prove to be much more complicated and protracted than many think.”
Jon Salisbury has written about the toy business since 1985, editing magazines and running toy media events in New York and London. He can be contacted at jon@wotkidzwant.com or @JonSalisbury www.wotkidzwant.com
Circulation & Subscriptions
AUDITED CIRCULATION Average Net Circulation:
6,181 July 1st 2010 to June 30th 2011.
SUBSCRIPTIONS UK: £50 Europe: £60 Rest of World: £90 The international cost applies per subscription and covers airmail dispatch of 12 issues
To order your subscription via Visa, MasterCard, Amex Switch or Delta contact toy.subscriptions@c-cms.com or call 01580 883 848. Alternatively visit our website www.toynews-online.biz