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MONEY SHOP


Footwear Today’s financial plumber, footwear retailer David Gummers, advises don’t forget the past when planning the present and the future.


T


he end of the year it is a good time to look back as well as forward. Recently, I’ve read some of my father, George Gummers’ articles in various issues of Shoe and Leather News from the 1980s and 1990s.


Dad was a leather chemist who later became MD of Millom leathers, then as manufacturing collapsed in the late 1970s he decided to open a shoe shop. He opened Footlight in Millom in 1979 and took over F.Dickinson, Ulverston in 1981. In 1983 he bought Riggs in Barrow and in 1987 bought a shop opposite so he could split the Children from Adult footwear. The most curious thing that happened when we had the shop in Barrow


from a trade perspective was a bizarre attempt to get us to increase our orders by suggesting that, if we did not, the agents would open accounts with a recently opened shoe shop down the street. My father with a typical scientific mind (if only I had inherited that!) responded to the two agents concerned “Feel free, but remember that when the business fails in 18 months’ time you will have to explain why you have no accounts in a couple of reasonably prosperous towns.” They decided to put the shoes in the other shop. One of our regular


customers came in about 2 years later and said “Do you know there are a couple of branded vans outside the other shoe shop and they are trying to recover unpaid monies for shoes?” While, we have sympathy for any business that fails, we had very little sympathy for the agents’ short- sightedness. Both were genuinely nice people and were, obviously, under pressure from their firms to keep their sales up and naturally wanted to earn a little more commission. My father to his credit, as the products were good did buy again, but we


were never again worried about how many pairs we had to order. I learnt a lot from this experience, as it was not about shoes. It was about people being short-sighted. I agree that you should never let personal feelings affect commercial decisions in less there is a serious moral question! While everyone is concerned about daily sales, I think it wise not to be too


concerned about a bad week or month. In the dip we have had over the last couple of years it is difficult to grow the business by the historic levels we all used to enjoy. If the economy in general is growing at 0.5%-1% you cannot expect your business to grow by 10-15% unless you open a new outlet or diversify your offer. In tough economic times buy less stock as cash flow is hampered severely


if you are buying more than you can sell. I take fewer risks, safe in knowledge that when the economy does recover as it will, I can always go to suppliers and buy more. I do not think that the world is going to run out of shoes for a while yet! I am lucky in that I am able to pick up the ‘phone to other retailers who


are not direct competition to me, and ask how they are doing. It is usual that their experiences will be much the same. If you are 10% down, when they are 25% up, you need to look at the business. Occasionally, there will be good and bad blips as it will never be an exact


science. You can help your business by listening to both your staff and customers and stocking the correct stock. One thing I have done recently, is


approached the 6 biggest employers in the area to offer the employees discount on any purchase. I think if we can win a few customers who would not normally think to shop with us, it must be worth the effort of half a dozen emails! My instinct tells me that it is going to take another two to three years


before the economy starts growing at 2-3% a year again. This is a purely economic point, as I cannot see people’s disposable income keeping pace with inflation for a while yet. Having said that, I am feeling more optimistic. Yes, there are plenty of challenges as we head into 2014. The Internet is going to be the biggest competition and however good an independent retailer’s site is - as my father said on more than one occasion “why should they visit our site!” Being realistic I know that every sale from it is a bonus from our core


business. Summing up, has retail changed from when my father was at the peak of


his powers, not as much as our generation would like to think. The competition for the slice of the cake is greater, which makes it harder to garner customer loyalty. More manufacturers are selling directly to the public and the speed of the Internet and communication have made it a 24 hour world. There is no point in wishing to turn the clock back, as the progress is a good thing. Retailing still remains such a simple process, complicated by humans!


All we have to do is buy a product from a supplier and sell it at a price that is greater than our costs and we make a profit.


If you would like David to look at your business costs, he promises that if he cannot save you any money you pay him nothing. But for every pound he saves you pay him, 15 pence. If you want to learn more email David on david@fdickinsonfootwear


Website: http://www.fdickinsonfootwear


.co.uk or call 01229 580654 .co.uk/


NOVEMBER/DECEMBER 2013 • FOOTWEAR TODAY


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