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There are few shops that can boast having 1m customer visits within three months. But then, there are not many stores in which you will find an alligator swamp, a 13-lane bowling alley, a 23-storey freestanding glass elevator and a hotel.
Bass Pro, a chain of outdoor sports shops, opened the emporium in a 535,000 square foot, glass-clad pyramid in downtown Memphis, Tennessee, in April. The pyramid, a former sports arena that had been derelict for the best part of a decade, is now the biggest of Bass Pro’s 90 shops.
It represents an extraordinary investment in retail at a time when most of the industry is grappling with the economics of their business models in response to the rise of dedicated online retailers, such as China’s Alibaba and Amazon of the US.
Yet this store was conceived of as a response to the rise of online purchasing: shopping as entertainment. Bass Pro’s founder, John Morris, was named as one of the 25 “People Shaping Retail’s Future” this year by the US National Retail Federation Foundation, an industry body.
The emphasis throughout the various departments — including camping, water sports, footwear and outdoor gear — is on fun and on experiencing the products on offer — whether by shooting a gun, learning how to tie a fishing fly or getting a fishing lesson in one of the ponds.
The pyramid may be an extreme example but many of its features are present in smaller Bass Pro shops, one reason why the typical customer lingers in them for almost two hours — four times the average time spent in shops, according to Paul Martin, managing director of KPMG Boxwood, a consultancy.
“People try the product and have an experience that brings it to life,” he says. This leads to higher sales. “The conversion rates [the number of visitors who buy something] with this in-store experience are much higher and shoppers’ basket sizes are also a lot bigger.”
Russell Willcox, chairman of Box Technologies, a UK-based consultancy, says replicating, and improving on, the online experience is how to win the battle for shoppers will be lost of won. For all retailers this involves trying to make shopping more convenient and pleasurable.
Opening more smaller convenience stores has also made it easier for people to top up a big online shop locally. But, once inside, customers’ tolerance for long queues is a thing of the past. Hence the proliferation of self-service checkouts, with staff on hand to sort out difficulties with machines quickly.
J Sainsbury, one of the UK’s largest grocery chains, said in October that it was testing quicker checkout methods, including a shopping app. This lets a customer scan in their shopping list at home before they head to the shop, where their mobile shows them where their items are located. The shopper then pays via their mobile.
In addition to convenience, shopping also has to be fun. These days you have to be as much a sociologist as retailer in thinking up enjoyable ways for people to shop, says José Carlos González-Hurtado, president of international for IRI, a consultancy, and a former senior executive at Carrefour, France’s biggest retailer.
A “surprise” — such as an unexpectedly heavily-discounted item — is one method, he says and such methods have the additional benefit for the retailer of promoting impulse buying. This approach has been taken by Costco, the membership-based US retailer where shoppers discover items at a hefty discount available for a limited period.
Limited editions and a constant stream of new styles are also effective in enticing people into stores and getting them to spend money. H&M’s limited-edition collections from designers that have included Matthew Williamson, Sonia Rykiel and Alexander Wang, may sell out within hours, but the publicity generated by the association lasts a lot longer.
Stores must also realise that they are becoming a social playground, says David McCorquodale, UK head of retail at KPMG, a professional services firm. “Why do pensioners go shopping on a Saturday when the shops would be quieter on a weekday? It’s often because of the social aspect, the buzz and hubbub. Young people also want to go shopping as a reason to get out of the house with friends and have some fun.”
Most purchases are still made in shops, but the lines between in-store and online are blurring, Mr McCorquodale says. If someone chooses a shirt from a catalogue at home, pays for it online and picks it up in a shop, is that a catalogue, online, or in-store sale?
Providing an efficient omni or multichannel service by having the correct IT systems and dedicated staff is going to be the way of the future, says KPMG Boxwood’s Mr Martin.
“A lot of commentators try to describe the store and the online channel as being enemies . . . [but] they are allies if executed well,” Mr Martin says. “It’s all about that seamless integration of the channels.”
Scheherazade Daneshkhu, Consumer Industries Editor
The old static five-year-plan is no longer relevant in an ever changing complex trading environment, argues Paul Martin, managing director at Boxwood Insights, part of KPMG Boxwood.
Change is not enough. You need to transform your business. You need to unlock its potential to drive profitable growth. To get results now, not next year, you need an experienced partner who will challenge your current thinking and bring knowledge and expertise from other sectors as well as your own. A committed partner who specialises in business transformation and who will work closely with your people in a way that suits you.
Talk to KPMG Boxwood.