FEATURE: MERCHANDISING & POS
COST MITIGATION IN 2025
Charles Powiesnik, currently Head of Retail at the Daley Hub and a retail veteran of over 30 years, offers his guide to cutting costs and driving growth for independent DIY retailers.
sector navigate countless challenges - recessions, technological disruptions, cultural differences and shifting consumer behaviours. But the current economic climate, shaped by the 2024 UK budget, presents one of the toughest tests yet. Rising business rates, increased labour costs and inflationary pressures are squeezing margins like never before. Yet, in every crisis lies opportunity. The key to survival and growth is acting decisively to cut inefficiencies and reinvest in strategies that drive sales and cash profit.
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But how do you determine the most productive path to tread? The risks are out there, not least in the lens of subjectivity viewed by every owner and team member invested in their business, limiting their view of what’s possible and slowing speed of execution. Cutting the right cost and reinvesting it for growth is the toughest of decisions and needs an ‘outside in’ set of insights. Let me share three hard-earned lessons to show how retailers can thrive in this environment, with such ‘outside in’ help.
1 Cut inefficiencies: Lessons
from the past Early in my career, I worked for a mid-sized supplier to the DIY chains struggling with bloated inventory costs. Despite having a strong product range it had a significant tail of slow movers leading to dead stock and cash flow issues. We made a conscious effort to pause and think differently about our problem not sustaining it through a nose to the grindstone approach locking up our creativity. We needed to release our creativity so we took an ‘outside in’ view. Using the right principles to sustain growth we trimmed the tail with creative supply chain modifications like just-in-time and renegotiated supplier terms. The result: a 20% reduction in inventory holding costs, improved cash flow
24 DIY WEEK MARCH 2025
ith over 30 years of experience as a retailer who has worked internationally, I’ve seen the retail
and a healthier balance sheet. Today, inefficiencies like these are even more costly and hiding in plain sight, perhaps an ‘outside in’ view may help unlock your business’ potential?
2 Drive sales with targeted know how promotions: Impulse zone
In the early 2000s, I was part of a team that turned around a struggling high street retailer in part by rethinking their front of store promotional strategy. Our data stood out in terms of footfall and the question was how to convert this into a higher ATV.
Added to campaign blanket discounts we introduced targeted, data-driven promotions with a weekly and monthly cadence. In-store, we positioned impulse buys at the front of the store, supported by a clear call to action and eye-catching displays. We set conversion as the lead factor to measure success rather than simply sales performance. The result was a 15% increase in sales and a 10% boost in margins. This approach is even more
relevant today as a means of mitigating rising costs and its more
likely hidden by the normal sales dashboard. An ‘outside in’ approach may reveal the opportunity.
3 Speeding up the customer conversion journey: A lesson in
One of the most transformative projects in my career was overhauling the customer experience for a bathroom retailer. We mapped the customer’s journey along its timeline and forced ourselves to link up existing tech resources to drastically reduce it through innovating a unique customer experience, at speed. One that visualised the bathroom the customer was dreaming of and provided the actionable data the sales team needed to close the sale in record time.
These changes not only
improved customer satisfaction but significantly increased our conversion rate to beat our sales budget and push out our sales horizon beyond what we expected. Sometimes this ‘outside in’ view can find that innovation, stretch the sales horizon and drive cash much faster than sustaining the status quo. If these hard-earned lessons trigger your curiosity then check
out
www.DaleyHub.com to find out more. Let’s work together and make things happen to drive your business growth. Contact me directly at
charles@daleyhub.com
A PRODUCT GUY WITH A PASSION
Powiesnik describes himself as a product guy with a passion and a world of experience in retail. He started as a supplier to B&Q and learnt logistics around DCs, quality assessment, ranging and sourcing internationally.
Following that he moved up the value chain to work with Wickes, B&Q, both UK and international, WHSmith, Poundland, Savers and Homebase in senior commercial roles. He has built ranges and promotional programmes across hundreds of stores and ecommerce platforms and gathered retailing wisdom and insights along the way. Working with the Daley Hub allows him to bring all of this to bear on its clients’ behalf to make things happen in UK retail with know how and what he refers to as an ‘outside in’ systematic approach.
www.diyweek.net
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