Gilroy’s viewpoint:  Can wholesalers learn from the field of elite sport?

Can England win this? Chloe Kelly stabs the ball home from close range at the second attempt. Cue her exhilarating shirt-twirling celebration across the Wembley turf. Everyone in the stadium is going wild. England 2-1 Germany, and they are on their way to winning the Euros, with millions of fans across the country in raptures. Who could fail to be swept up in their success? How can a team that seemed to have stalled 18 months ago power through 20 games undefeated to take the title? Three words: coach Sarina Wiegman.

A few weeks earlier, at the Headingly Cricket Ground, against all odds, Jonny Bairstow smashed one of the fastest-ever unbeaten centuries to close out a famous test victory against India to level the series. Remarkably, it is his fourth century run chase of the summer, and England’s fourth consecutive victory. How can a team that previously had only one win in 17 matches and looked totally moribund lift itself up to beat two of the best test teams in the world? Three words: coach Brendon McCul­lum.

Players and experts commenting on Wiegman and McCullum describe their methods in similar words and phrases: clarity of vision, simplicity, consistency, continuity, risk taking, lack of fear, trust in the players, deep understanding of the game, meticulous preparation, calmness under pressure and a whole lot of fun. Are there busi­ness parallels and lessons to be learned from sport and are there similar types of leaders to be found?

No-frills airline Ryanair is not uni­versally admired by the industry or its peers, but its customers know what to expect and buy tickets in large numbers. Chief executive Michael O’ Leary is straight-talking and doesn’t pull his punches. He has a clear vision of an efficient, low-cost airline operating with maximum passenger loadings, opti­mised by a dynamic pricing model.

The entire management team is focused on driving out unnecessary cost, running profitably and planning ahead. The business hedged effectively against the oil price increases, and this is bearing fruit. O’Leary never deviates from the mission and will make tough decisions to keep the business on track.

As The Sunday Times reported recently, when EasyJet cancelled 741 flights in June from UK airports and British Airways cancelled 421, Ryanair scrapped only 25. The biggest cause of airport chaos was staffing, and while its competitors were culling numbers during the pandemic, Ryanair did a deal with the Unite union to save cabin crew in return for temporary pay cuts. This enabled the company to respond quickly to the increase in demand post-pandemic. Ryanair did everything to keep its pilots flying – if they weren’t on planes, they’d be in simulators.

Read more: Opinion: Is it possible to operate virtual events and achieve the same commercial results? 

Fashion retailer Next started life as a skunkworks project at Hepworth’s in 1982. George Davies, the project leader, had other ideas, and 70 Next stores were trading within weeks of launching. His knowledge and eye for design were sec­ond to none. He set the vision of ‘great design at affordable prices’.

This remains central to the compa­ny’s values statement to this day. The business has become one of the UK’s most consistent top-performing retailers. Under the leadership of Lord (Simon) Wolfson, it has outperformed the FTSE 100 and the retail sector by a wide margin for more than 20 years.

Oliver Shah, in The Sunday Times, writes that Wolfson’s strategy has been defined by consistency, an eye for detail and pragmatism. He has constantly trimmed the property portfolio, getting rid of poorly performing stores and managing down the average lease length. Unlike many of its high-street ri­vals, Next has never found itself saddled with excess space. Its trading statements and market guidance are models of clar­ity. Next plans forward, subjecting itself to brutal stress tests looking at how its   business will fare over the next 15 years including shop sales falling by 10%.

The company had to close stores in the pandemic, but Wolfson used the time to turn it from a fashion retailer to­ward being an online platform providing services for third-party brands. Compare and contrast with Marks & Spencer. Next thrives in a turbulent market.
Well established in the US, ware­house club Costco entered the UK in the early 1990s. Warehouse clubs are unique in that they charge customers a membership fee before they are allowed to shop. The format is positioned as wholesale and is all about large bulk packs and focused ranges offering outstanding value.

Costs are ruthlessly contained and waste is driven down. Supplier invest­ment is invariably channelled directly to the product to ensure the most compet­itive selling price at all times. Costco’s target customers are broadly – but not exclusively – business users including retailers and caterers.

The range numbers are tightly con­trolled, with around 60% of shelf space devoted to clothing, homeware and elec­tricals. This product mix significantly contributes to gross margins. Costco is hugely successful and has opened stores and built sales since launch.
Jeremy Garlick, of FMCG strategy consultancy Insight Traction, highlights one of Costco’s key strengths – fresh food. While Tesco and Sainsbury’s have closed service counters and cafés, and have given way to an ocean of bland­ness, Costco prepares much of its fresh food on site with food-production areas highly visible. The selection of meat, fish, prepared meals, fresh produce and celebration cakes is peerless. Sampling throughout the department with knowl­edgeable colleagues advising customers underlines the retail confidence.

This, aligned with the authority of the bulk displays, gives a level of theatre rarely seen in the multiples, and this makes Costco an exciting destination. I have studied Costco in the US and Europe over the years, and it never devi­ates from this format. It is clear about its proposition, it executes superbly and colleagues are highly committed. Costco knows exactly where it is and the format delivers continual success.

Family owned Parfetts built its busi­ness over many years on the premise of honest value, comprehensive ranges and good service geared to small-store customers. This assured a measured sales trajectory at a manageable pace. Over the past three years, the business has sprouted wings and turbo boosters to outperform the market, but how?

Before stepping back, Steve Parfett determined to set up the company along employee-owned lines similar to John Lewis Partnership. This has been an undoubted success and seems to have fired up the entire workforce.

The business has stayed true to its primary mission of being brilliant for independent retailers by continually honing its Go Local store formats, and it has mastered the art of operating as a cash and carry and delivery hub within the same premises. This is no mean feat and, as a consequence, productivity and sales per square foot are some of the highest in the industry.

The employee partnership model enables the business to reinvest in services, facilities and its fascia estate, thus continually improving the customer offering and locking in loyalty. Even in these tough times, Parfetts continues to offer free deliveries on a given set of commercial terms. Confidence is high and Parfetts is set to open its eighth de­pot in central Birmingham as it looks to expand its Go Local symbol operations.

Operational excellence, talented, mo­tivated, committed players and effective succession planning are essential for success. This is the platform. To elevate above this level and into the realms of the stellar, a clarity of purpose, consist­ency, simplicity and a true belief in the proposition must be rooted in the core and continually nurtured. This is what characterises the top-performing elite sports and business enterprises

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David Gilroy is the founder and managing director of Store Excel. He was previously the convenience retail lead at W2 Commercial and held operations director roles at Bestway Wholesale and Nurdin & Peacock.


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