Why It’s Time to Diversify

Why It’s Time to Diversify
The pure product-based retailer, whether independent or multiple, is in long term decline.

Mike Weedon is the deputy CEO and communications director of the British Independent Retailers Association (bira), which represents thousands of UK indies. 

He says the days of pure-product retailers are numbered. Here’s why…

“Within the retail mix the pure product-based retailer, whether independent or multiple, is in long term decline, while those providing services and leisure have increased. “Unless they are out-and-out specialist destinations for specialist consumers, diversification offers retailers a way to attract new customers and spread risk across a wider range of products.”

“We see this everywhere in the wide membership of bira. Fashion shops add accessories, footwear and luggage. Cookshops extend into giftware and food. Gift shops show a sparkling ability to develop new lines in furniture, handbags, greetings cards, and clothing.”

“The challenge for the independent retailers, strapped more for time even than cash, is to hunt down those new product areas that will widen their appeal, so trade shows offer them an increasingly valuable way to discover future winners with the least expenditure of time.”

“An even bigger challenge comes from the ever growing range of competitors for each consumer pound.”

“While the numbers of shops have grown since the crash, gaining more than 6,000 independents net since 2009, they have been more than matched by larger numbers of new online retailers, which may now be trading in the UK, anywhere in Europe and further afield.”

“It helps to have elements to the business that require the customer to be in a shop, to help justify having a shop. So we see cookshops that have cafes and delis, fashion shops that provide bespoke tailoring, even toolshops that sell
skills training.”

“But footfall can no longer be relied on solely to deliver a growing base of consumers, even if the canny retailer diversifies the offer. Shops have to be where the attention of the shopper is if they are to be noticed and if the attention of the shopper is on Facebook or Twitter, on Amazon or eBay, then that’s where they need to be. This is diversification again, diversification into multiple networks.”

“To make the most of those opportunities independents need to choose where to concentrate their efforts, to be nimble and to be quick.”