NEWS EXTRA CONFERENCE
and watch what others do and learn from them. My advice after over 30yers in the industry is just don’t sit back. Times are changing too fast at the moment, you have to act you have to learn, you have to make decisions.”
The customer base is changing, rapidly, and as a result, there is an increased focus on trade amongst the bigger DIY retailers “Why? It’s because, the big retailers over the last few years have always known how to get to their customers – to the 50+ year old guy, used to walking into stores and buying stuff over the years. Home improvement retailers understand those guys, and how to dela with them. But they don’t know how to get to the younger people coming into the industry. They don’t know what to say to them, they don’t know how to translate things and they don’t know how what this new demograph wants. “So, what do you do as a retailer, you focus on trade,” he said. However, Collinge pointed out that even the once solid trade market is changing. “There are now almost two distinct areas of tradespeople. There’s the traditional, have the 45-50 plus aged tradesman. We know what they like, we know how they react, we know what they want in branch, we know what they want from promotions. The younger trade though is quite different. Sales of tool boxes for example, are dying off, to be replaced by backpacks. The younger trade doesn’t want a toolbox, that’s what granddads use. A backpack though, that’s for the modern tradesperson. A printed catalogues to flip through when you’re eating your sandwich? yes please, if you’re the older tradesperson, no way for the 25-year-old tradesman. All they want to do is order from Toolstation or Screwfix or whatever website on a Sunday evening, know their materials will be on site at 7am Monday morning and get on with the job. Those are two very different part of the target market.” Collinge looked at a number of elements disrupting the traditional trade market, one of which involved deliveries and range expansion. “Drop-shipping, where items are delivered to customers from the suppliers, without going near the store or yard, is one way that retailers and trade suppliers are increasing their ranges without taking on too much new stock,” he said.
“If you have stores you are limited in the number of SKUs you can offer, even if you add all that to the website, that’s still what you can offer. 15-20 years ago, if you wanted to add more products onto the website, it meant adding more products to the warehouse. More to stock.
SIT UP AND TAKE
CONTROL
Steve Collinge md of Insight had one key message for delegates: “don’t sit back”.
“THERE’S A LOT of sitting and watching at the moment across the sector,” said Insight Retail md Steve Collinge. “Whether you are a merchant, a manufacturer, a distributor or a buying group, there are so many options and opportunities out there that we have to navigate. Technology, supply chain, routes to market. So many different things to think about and decisions to make. We can either to take some of these routes, test, trial and learn along the way, or we sit back
July 2024
www.buildersmerchantsjournal.net
“Drop-shipping removes that issue. You can offer thousands more products, delivering them direct from your supplier base to your customers, still making you margins, still making your profits, but suddenly you are competing better. Why not offer your customers not just 10 to 15 product lines from a supplier that sit in your yard, but 100 to 150 lines from that very same supplier.”
He gave the example of Toolstation, which took 70 of its existing suppliers and massively increased their ranges in a period of eight weeks, and Robert Dyas, which completely transformed their business by 500 new suppliers in the first year, by adding a drop-shipping element. “You can buy a kitchen at Robert Dyas now,” he said. Marketplaces are another way that companies are expanding their reach, Collinge explained.
“These marketplaces are not just eBay and Amazon, retailers are adopting them too. Next and Marks & Spencer have bene doing this for years. Take B&Q. People are already going to the website for DIY trade, home and garden products. B&Q Marketplace has grown to 1.2million products in two years, with a turnover of £154m, with 320milion visitors a day. 50% of the people who make an ecommerce purchase from B&Q do so via B&Q marketplace.”
Consumers and trade: both are changing, Collinge continued. “The younger generation is having more influence, gaining more traction, but getting to them and understanding them is challenging. The epocalypse it’s here. The number of channels and the number of opportunities is growing all the time. My advice. Stop sitting back and watching it, get involved. test it, trial it, learn from it. It’s fundamental for the success and survival of businesses in this sector.” BMJ
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