Category: Recession


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By Russell Adams, AdMore Recruitment– Specialists in Retail and Hospitality Recruitment, Search & Selection, Talent Management and Career Development.

Having recently read a number of blogs on this subject I feel compelled to write this as I believe most articles are very one sided in their viewpoint. Most are focused on outlining to candidates the many reasons why, when they resign, they should not be tempted to stay by a counter offer. I don’t think I have read anything explaining the reasons why you SHOULD accept a counter offer but here’s the thing – there are times and there are circumstances when the right thing to do is to stay put.

To me it all comes down to the individual’s motivations for leaving the organisation in the first place. Often individuals are very happy in their careers, working for a company they respect, where they are paid well for the job that they do, where they are culturally aligned and where they feel valued. Sometimes the missing piece and hence their desire to move on is purely driven by their ambition to take on a more senior role with more responsibility. If the counter offer entails gaining that promotion and taking on that responsibility then why not accept?

You can ask why had the promotion not happened already however sometimes (particularly in the current market) there has to be a reason or a rationale to make things happen. Your resignation may just be that catalyst that makes things happen.  Only you as an individual will know how well you have been looked after and how genuine your employer’s intentions are.

As has been well documented, I would also caution people from accepting a counter offer based on either pure promises  or increased salary alone. This is an important and difficult decision for people to make, often with two competing parties putting you under significant pressure to stay or to accept the other role.  Certainly, these situations are rarely as clear cut as many articles suggest.

My advice if you are unsure is to talk to people you trust who are impartial to the situation and who will try and make you see the situation in a balanced and unbiased way.

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By Shane Horn, AdMore Recruitment – Specialists in Retail and Hospitality Recruitment, Search & Selection, Talent Management and Career Development.

I’m a retailer, first and foremost. You only have to ask my wife how annoying I can be re-merchandising a store I have followed her into! I now just so happen to recruit people into the industry I love. Yes, it is tough going, but retail businesses are still looking for great people, that is something that hasn’t changed over the years!

What has changed however is the lay of the retail land. Omni-channel, Click and Collect and the newest buzzword ‘showrooming’ weren’t around 3 years ago, let alone 19 years ago when I started my retail career with Next! But what hasn’t changed is the key focus for all retailers great and small – the focus on the customer and service.

What prompted me to think about this was a pretty poor experience over the weekend where multi-channel retailing resulted in both a loss of sale (and a grumpy wife!)

We were looking to buy a shelving unit in a well known department store. We saw one we liked but were informed that the product was only available to buy online. Not a problem I thought, when I get home I will log in to their website and purchase, select my delivery date – happy days! However, the product wasn’t on the website. It was nowhere to be seen! No mention of it, and no idea if it was out of stock or just old season. So, how can it go so wrong?

Purchasing a product has never been easier. We can do it sitting on a train, over the phone, heck, we can even walk into a store and buy it on our lunch break!  Regardless of the method of purchase this experience falls down with bad service. How often have we heard a friend mention they have ordered a product for it to then mysteriously be sold out? Or received poor, ill informed product knowledge on the high street?

Consumers are an intelligent bunch. There is a lot of talk of the rise of the Mamil, (Middle Age Men In Lycra). Although not quite middle aged, I am one of a growing band of men happy to spend a fair bit of cash on my bike. Halfords have been very clear they are looking to take a large chunk of the market, and have recently launched a huge customer service program costing hundreds of millions on pounds. There is talk of recruiting specialists into each store that ‘know their stuff’ (although Jessops may testify this is not always a great commercial move). Anyone that has recently visited an independent bike retailer will tell you that making you feel like an idiot for not knowing your groupset from your chainset is as just as bad as the sales assistant knowing next to nothing! Consumers want choice, and great service, and the Mamil is tech savvy. They will spend hours reading through magazines, forums and reviews looking for the next product that will shave a few seconds off their PB, or save them a few grams. This, I think, is why the likes of Wiggle, Chain Reaction and Evans Cycles have got it right online. There is choice, they have knowledgeable staff, (you can hide behind an email and not look stupid!) and items are delivered on time or even to store in the case of Evans Cycles.

The Mamil is not just a new breed of male, ahem, ‘athlete’ but a new brand of consumer who wants to be treated well and maturely. It is too simple to expect the customer to come into a store without an expectation of service.

Mothercare have recently commissioned a survey to assess how consumers respond to a smile. Funnily enough they spend more – is this really surprising? It shouldn’t be! If staff need to be taught to smile, then frankly they are in the wrong industry.  It doesn’t matter how much you spend on websites, logistics or stores, if the consumer doesn’t get a warm fuzzy feeling then they will go elsewhere.  The choice is huge for the consumer, it’s competitive and with the help of social media, it is now transparent. If you don’t get it right, your customer will let you know about it!

Customer service is expensive. To have the right people  properly trained is not an easy task but the opportunity cost of not getting this right is huge (the old retail saying  – you’re only as good as your worst member of staff still rings true!).

Retail is, in its simplest form, straightforward. There are a large number of retailers getting it right, and those looking to change focus should be applauded. Getting people to part with their hard earned cash is tough, and as the consumer changes so does the world of retail. But, at its core, Service is key, and that hasn’t changed since I started my retail career all those years ago!

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By Russell Adams, AdMore Recruitment– Specialists in Retail and Hospitality Recruitment, Search & Selection, Talent Management and Career Development

Reading through the latest hospitality report from the Caterer.com job website released this week unfortunately doesn’t make particularly happy reading. Whilst the Governor of the Bank of England talks about signs of recovery, it is clear that the Hospitality sector is still having a challenging time which naturally impacts on the people that work within it.  So what are the numbers telling you about the sector and your employment prospects?

Looking at the numbers from the Caterer report there is a clear decline in the number of vacancies with a fall of some 10% on the previous year. Unfortunately for job seekers, this was matched by a 4% increase in the number of job applications. This reinforces what we are seeing in the market, that the job market in hospitality remains extremely competitive. In fact, looking at the previous caterer report we can see that in fact the decline in roles has actually accelerated from an 8% decline to a 10% decline and that the increase in applications has also accelerated, moving from a 2% increase to a 4% increase.  Such dramatic falls can be reconciled by a number of factors, firstly that due to the on-going economic uncertainty people are “sitting tight” which is actually reducing “churn” in the market.  However it can also be attributed to the continued economic challenges that are causing businesses to remain cautious about their investment in people.  Without doubt though over the last four years, many businesses have chosen to invest in developing and retaining their existing staff as the most cost effective people strategy.

Across the sectors, there has been mixed performances. Some sectors have fared better than others with the Pub sector continuing to face very challenging times. According to figures from the Office of National Statistics, over the last 5 years there has been a 14% decline in the number of pubs.  Interestingly according to those statistics in 2011 5,505 new pubs opened but some 6,115 closed indicating the significant churn and instability in that sector.   This also reflects the changing nature of the market as pubs adapt to trends in the market with many now diversifying into more food-led operations.

However, there are some good news stories out there and reading the M & C report each day certainly gives me some hope. As expected, there are always winners and losers and in this highly competitive sector, those businesses that have their proposition right and are able to communicate this effectively to their customers are prospering.   Whitbread for instance recently released some stellar results with like-for-like sales up 3.7% and yesterday The Restaurant Group’s shares reached an all time high on the back of the strong results they released yesterday showing a 4.5% increase in their like-for-like sales.

The Hospitality sector continues to be an incredibly dynamic and exciting industry.  Trends and customer needs are constantly changing. New concepts, designs and formats are constantly being designed and launched and those that satisfy and capture the needs of the market will reap strong rewards.

So what do these statistics say about your career in Hospitality?

Firstly, it shows the sector continues to face challenges and that the competition for roles remains as intense as ever. This reinforces the need for candidates to prepare effectively for their job search and to ensure that, when they do secure an interview, that they are able to perform exceptionally well. By conducting thorough research into the brand including site visits and SWOT analyses when appropriate, ensuring that you are able to provide tangible examples of your achievements and by giving evidence that you possess the capabilities required for your target role, you will have an edge over your competition.

It also shows that different sectors are performing better than others and within each market there are clear winners and losers. With rapidly changing customer needs, businesses need to change, adapt and evolve and those that do will outperform the market strongly. By keeping in touch with developments in the sector as a whole, you will be able to assess where the growth areas are likely to be and which businesses will offer you the most career development. Industry publications such as the Caterer and the M&C report are invaluable however, keeping in touch with your personal network of contacts is also hugely effective in keeping tabs on what is happening in the industry and what opportunities this could present for you.

To be successful in your job search in the current market, you must focus on those roles where your skills are most transferable and where your experience is most relevant. By doing this, you will maximise your chances of success when a precious vacancy arises.

For further advice on your job search, please read our blog “How to look for a role in 2013

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By Jez Styles, AdMore Recruitment– Specialists in Retail and Hospitality Recruitment, Search & Selection, Talent Management and Career Development.

The retail sector has continued to take a battering over the last twelve months, not least with a number of high profile company administrations. This has resulted in a large influx of candidates coming on to what was an already an overcrowded and highly competitive market. It can be a heart-breaking situation for many candidates who have developed an excellent skillset and still have the passion and drive to grow their career. However, if you are flexible and open to new ideas there are a wealth of opportunities out there. Retailers tend to pick up a broad and highly transferable skill-set. Indeed, there are few other industries that could better prepare you to move to a different sector. If you are keen to consider options outside of traditional retail, the first step to understanding what you could do next is first identifying what your transferable skills are:

  • Leadership & People Management

Clearly this is a broad and complex subject but in my experience, the two core skills that are often in demand are; the ability to motivate direct reports, indirect reports and other stakeholders and; the ability to manage performance in a formal and structured manner. Retailers generally learn how to do this both on the job and in the classroom – an option not always available in many companies. This skill is perhaps in itself the single most important as it really does allow retailers to move in to virtually any industry where people management is the key requirement.

  • Profit & Loss Management

Most retailers offer varying levels of accountability however broadly speaking, most have a strong understanding of the key lines in a P&L and what pulleys and levers they can operate to drive a result.

  • Business & Project Management.

Again, this can cover a multitude of things but in this case I believe that retailers have an excellent ability to manage a broad range of objectives. The skills employed will be time management, priority identification and ensuring task completion.

  • Strategy and tactical development.

The degree of exposure and therefore capability will depend on the level that you have reached but retailers learn from very early in their career, at the very least, how to develop a tactical plan on a daily, weekly, monthly and annual basis.

  • Sales & Business Development

Not every retailer is given the opportunity to ‘sell’ or indeed develop their business on a wider context, however those that do are able to develop a highly transferable skill. This, coupled with people management ability is in high demand currently as many companies are looking for an additional edge in a stagnant economy.

  • Coaching

Arguably this could sit under general people management. However, retailers will often develop this skill in matrix management structures whereby they are coaching individuals that are not direct reports.

  • Customer focus.

There are very few industries where managers are exposed to customers directly in such volume and regularity. Retailers have to react to market changes at pace and with a high degree of accuracy. Balancing customer focus with profit is not always straightforward.

  • Operations Management.

Depending on your retail background the experience you have here will vary. By operations management I am referring to the management of the supply chain and the store operation. Food & ‘big box’ retailers tend to have the most advanced skill-set in this regard. Understanding the cause & effect of moving units from one place to another may sound simple but in high volume environments it can be incredibly complex.

  • Relationship management.

Retail Managers up to Director level will generally develop the ability to manage multiple relationships often with stakeholders with varying agendas. The ability to balance the needs of multiple stakeholders is often overlooked but is in high demand in numerous industries and job families.

  • Change Management.

Given the scale of change that the Retail Industry has faced and continues to face, the ability to manage change has become essential for most senior retailers. Change management is often a combination of the aforementioned skills with a set of behaviours that allows for a successful delivery.

I have generally found that it is a combination of these skills that most attracts employers to ‘fish from the Retail pool.’ I would love to hear from people that have changed industry and what enabled them to make a successful transition.

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Previous blogs:

How to avoid joining the wrong business

What the numbers tell you about your future career in Retail

Retail: my tale of faith, love and survival

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By Jez Styles, AdMore Recruitment– Specialists in Retail and Hospitality Recruitment, Search & Selection, Talent Management and Career Development

15 questions you need to ask before accepting an offer.

This year we have seen a significant increase in the number of candidates returning to the job market, albeit relatively passively in a lot of cases. Surprisingly, while the reasons can be poles apart such as redundancy or a lack of career progression, it can often drive similar behaviours amongst candidates. I have commented previously that a significant number of candidates have made the wrong decision about a career move because they have not completed their due diligence. While this list is not exhaustive, considering the following points before accepting an offer may help you in your decision.

Why is there a vacancy?

Ask this question when you are briefed by an agency, ask this question in your first interview and ask this question in your final interview.

How often is this position recruited?

This is a very difficult question to ask in an interview but you need to know the answer. Linkedin provides a good opportunity to do some research and it is worth making contact with a couple of past employees to informally ask them about how often the role has been / is recruited.

Why do people leave the business?

Ask everyone!

How many people have been promoted internally at my proposed level in the last 2-3 years? Who was the last person to be promoted and what did they do to achieve this?

How is the business performing financially?

Check out the last set of company accounts. This is particularly important if the business is small and relatively unknown.

What is my prospective Line Manager like to work for?

It is crucial you work hard to informally reference your new boss. Speak to people you trust to seek their opinion. Check out their Social Media (Linkedin/ Twitter) profiles.

What does your Sponsor(s) think?

It often takes someone without prejudice to give you some simple and much needed honest advice.

What was the average bonus payment in the last financial year and what was the average pay rise?

Do I fit the company culturally?

Look at the company’s values and working culture. Do you like what you see? Does the reality match up with what is described in their marketing material? Again, talk to employees past and present.

Why do they want me?

This is a difficult question to ask as you will want to believe it is because you are the best candidate. However, are there other reasons, for instance your inside knowledge of one of their competitors?

Does my consultant sound convinced that he/she is recruiting for a great business?

It is worth working hard to build a good personal relationship with your consultant as they will provide the odd snippet of information that could help you to make your decision.

Does the offer of employment and/or contract match what I have been told verbally?

Don’t be afraid to dig deeply in to the Terms &Conditions of the contract however be careful how you position your resulting queries.

When did the company last restructure and are there any plans to do so in the future?

Look for a pattern, you will be amazed by how often retailers restructure from one working model to another.

What impact will this move have on my personal brand or future career opportunities?

Am I taking this job because I want it or because I think I have to take it?

Think about the longer term implications of taking a job for the wrong reasons.

This is of course not an exhaustive list, and would welcome any thoughts and additions to the above.

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By Jez Styles, AdMore Recruitment– Specialists in Retail and Hospitality Recruitment, Search & Selection, Talent Management and Career Development.

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By Jez Styles, AdMore Recruitment– Specialists in Retail and Hospitality Recruitment, Search & Selection, Talent Management and Career Development.

Last year I wrote about the lost generation of middle managers in retail whom face limited progression opportunities as a result of the recession. Since that article the redundancies have continued to flow thick and fast with all sorts of rumours about which retailer is going to collapse next. One might think that with all the doom and gloom in the market that the opportunities to develop your career are few and far between. However…

If you are ambitious and do want to avoid this scenario you have two very simple options, either ensure you are promoted in your current business or move to another organisation where there is genuine opportunity for advancement.

How to progress your career within your current business:

  • Does your Line manager, Head of Talent, HRBP know you have ambitions to progress? Sounds simple but don’t assume so. Be explicit about your career targets. Clearly you will need to judge when and how to position this conversation but it really is the starting point.
  • Are you getting the results? You know in your heart of hearts if you really are delivering, if you are not you need to address this.
  • So, you are doing well…does everyone else know that? It is all well and good if you run the most profitable part of the business but if the board / functional heads don’t know this you will have few sponsors when the next round of restructuring starts. I have met a lot of candidates with relatively modest results but who were fantastic self-publicists and as a result they were promoted!
  • Seek feedback. The old 360 appraisal can be painful but it will do two things; firstly it will highlight what you need to do to improve and secondly it says a lot about your focus on self-development. This is a competency that is being increasingly measured in assessment of stretch potential.
  • Work harder, it sounds old fashioned but to be blunt it makes an enormous difference to your senior stakeholders. Admittedly there has been a societal push towards work/life balance (and rightly so) but once again those who do more…achieve more.
  • Get involved in project work. If you are Head office based get in to stores, if you are operations based get in to Head Office. A key determinant of progression is breadth of experience. Your Operations Directors, Managing Directors and other board members will have done this at some point in their career. This will also expose you to other stakeholders and will give you a chance to self-publicise!
  • Socialise. Get to know the senior team on a more informal basis. Once again, the people whom are liked by the board tend to get the better jobs.
  • Identify sponsors, people whom have a vested interest in you doing well and will fight your corner / put a good word in when necessary. It’s an ego boost for the other party and you will also get good career advice.

You need to look elsewhere…what do you do?

  • Put together a ‘campaign’ plan with short, medium and long term objectives.
  • Identify what you want to do next. It is worth sense checking with your contacts that this is realistic. A major salary increase and a promotion are highly unlikely.
  • Call your contacts in the recruitment firms. While we recruitment consultants are often grouped together with estate agents, double glazing salesmen and those chaps whom knock on your door to kindly inform you they have just tarmacked your drive and you owe them 200 quid… However, we do on occasion add real value. There is an art to working your relationship with consultants – in short, what you put in you will get back. Behave transactionally or with contempt and expect a mirrored response. Similarly, if you want to get the best out of a consultant, treat him like a human being and they will do the same.
  • Speak to your sponsors. If you have built a few up throughout your career they should be able to put you in touch with their contacts, hopefully with a recommendation.
  • Call old bosses. If you did a good job for them before they will be inclined to give you another go.
  • Fire up your Linkedin profile. It is beginning to position itself as a job board these days and most internal and external recruiters use it as a secondary database. While you are there delete any old profiles on the job boards – they are very much aimed at the junior end of the market. Bear in mind that this is your shop window and as every Operations Director will tell you, customers won’t go in and buy if it isn’t well cared for.
  • Don’t be afraid to invest in some external support and advice this may be as simple as a CV rewrite or career/life coaching. A good quality CV rewrite will cost between £300-£500…roughly the same amount as a new set of wheels for your car…
  • Finally, do your research before accepting an offer. A large number of candidates have found their CVs becoming very patchy over the course of the recession as they have hopped from one business to another. The one factor that generally underpins any mistake in a career move is a lack of due diligence. Would you buy a house without having it surveyed?

Good luck…

Jez Styles

 

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By Russell Adams, AdMore Recruitment– Specialists in Retail and Hospitality Recruitment, Search & Selection, Talent Management and Career Development.

Last autumn I wrote a blog summarising the state of the retail recruitment market. With Christmas and sales out the way and following a wave of statistics published, I thought it was a good time to look back on the market but also to look at the consequences for individuals and how they manage their careers.  

Over the last few weeks a number of figures have been released and by and large they have all painted a pretty negative picture of the retail recruitment market reflecting the pain and challenges seen by a number of retail businesses.  With these statistics based on 2012 they may take some account of Comet but won’t factor in the impact of Jessops, Blockbuster and HMV.

Figures published by the BRC show that in Q4 2012 there was a small increase in overall numbers employed in the sector of 0.6% but that this was largely being driven by growth in the number of individuals working on a part time basis. A fall in the number of units by 3.6% is of no surprise and it will no doubt increase once the true impact of the recent administrations is felt. More worryingly was the forward looking survey which suggested that some 50% of companies were planning to reduce their headcounts in 2013.

Recent statistics from the Retail Choice job board show that in the 2nd half of 2012 the number of roles advertised fell by a staggering 25% with a fall in management roles being the major driver falling some 32%. This fall in numbers could be due to a number of factors. Firstly that the overall number of roles in retail is declining, that individuals are less willing to change positions in this volatile market or a broad trend away from always advertising such roles on job boards.   In reality I suspect it is a combination. Clearly with a declining store count on the High St, even with the growth in online retail the overall need for employment in retail is likely to be in decline. Secondly, the recent failings on the High Street will have given little confidence to individuals who are thinking of moving. If you are well rated and secure in your current role, you may need quite a large incentive to move to another organisation. That said I think for many individuals they have had this in the back of their mind for the last couple of years and at some point in order to progress their careers they will need to take that risk if they are not able to gain the progression they desire internally.  On my last point I do believe that job boards are still a mainstay of recruitment for roles at a variety of levels but the recruitment market is increasing in complexity and this is having a knock on effect on how candidates go about their job search. Whatever the factors behind the fall in jobs, the upshot is that competition for roles intensifies and Retail choice reports an increase in applications for each Management role of an incredible 50%.

As I wrote in my recent blog on the future of the High St  stores need to focus on providing a compelling reason to shop their bricks and mortar store and provide a customer experience. This in turn is leading retailers to look for individuals with a different skill set and experience than in the past. So it is not all doom and gloom. As the high street changes and has to adapt to the growth in digital, some job areas will continue to grow leading to a skills shortage in some specialist areas, examples of which would be e-commerce and visual merchandising.

Another interesting dynamic is that most retailers have spent the last few years aggressively cutting their cost bases and rationalising their businesses.  From the some recent conversation with senior retailers it is difficult to see in most organisations where they can cut further in 2013 and that for many the only way forward is to now starting aggressively growing their top line sales. I think inevitably this will lead to further movement in the market over the next year or so as businesses seek individuals with a different skill set who can help them drive growth.

So what does this mean?

Without doubt the job market for candidates is as competitive as it has been over the last few years. Most commentators agree that physical footprints will decline overtime and unfortunately this will lead to less demand for Store Managers, Area Managers, Regional Directors and Operations Directors and people need to consider the consequences of that. All of the statistics support this fact with the only real question being the pace at which the decline in stores will occur. As stark as this sounds it must be a consideration for individuals working in this area. For more central roles demand is likely to be more constant but again some areas may well contract as the nature of retailing continues to change. The changes will have some positive effect, clearly in specialist areas such as e-commerce there will be continued growth as this area of retail develops.

As the market becomes more competitive, individuals need to make sure they are proactively managing their careers, taking control trying to set themselves apart from others in the market. We have previously talked about the importance of how you manage your job search.

With no sign of improvement in outlook for candidates there has been much discussion amongst my colleagues around how individuals more proactively manage their careers with a clearer long term strategy.

Overall people need to think carefully about the skills and experience they have and which businesses may be interested in these. But more than that they need to think longer term about the skills and experience they need to gain in order to fulfil their career ambitions. Which skills are going to be most sought after in the future and how can they can these be gained?

By Russell Adams, AdMore Recruitment– Specialists in Retail and Hospitality Recruitment, Search & Selection, Talent Management and Career Development.

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Sophie Mackenzie – Senior Partner, AdMore Recruitment

I previously worked as a Recruitment Manager in the IT industry. When I resigned in July 2011 to join a specialist Retail consultancy there was many a raised eyebrow. There were gloomy headlines about the Retail industry and that has been pretty much the case ever since. There is no question that I have taken a leap of faith: faith in the potential of the business I have joined and the abilities of my new colleagues but also faith in the future of the UK Retail Industry. So why make this perilous move in the middle of a recession where, as usual, Retail gets the biggest hammering?

The thing is, I really love the industry. I love the variety, the heritage, the way it changes constantly and most of all, the people who work in the industry. There is a common thread that runs through most retailers – they are down to earth, pragmatic and real grafters. In most cases, retail businesses are meritocracies – rewarding the best performers and offering genuine opportunities for progression. Few industries can say the same. As the third generation of my family to work in retail, you could say it’s in my blood.

My Grandfather left school at 15 because his wages were needed at home and he started work in a fancy goods shop on the Golden Mile in Blackpool (a veritable Aladdin’s cave of toys, souvenirs, and ‘saucy’ seaside postcards!), working his way up to Manager. Before long, he decided to open his own shop, a local newsagents. Meanwhile, my own father left school at 17 and, after a couple of years as a bank clerk, joined Marks and Spencer as a management trainee. He remembers fondly the days when Blackpool was such a cutting edge place to be, that M&S used the store to trial all the latest ranges – how times have changed, sadly. 20 years later when my Grandad retired, my Dad left the corporate world to take over the family business.

Our shop was the hub of the village. Dad applied ‘big’ retail techniques to his small business and so, unlike so many of the newsagents and convenience stores you see – poorly stocked, windows obscured by posters and small ads – it was well lit and presented with a decent range of product and standards were meticulously maintained, not least by yours truly who worked as a Saturday girl while still at school. Although under increasing pressure from the tighter margins imposed by the newspaper publishers and the rise of the supermarkets, Dad didn’t take this lying down and tried to ensure there were other reasons for customers to come to the shop – a photocopier, fax machine (!), an extensive greeting card section and eventually a National Lottery machine. By anticipating changes in the market and through the sheer hard graft of he and my Mum they built a successful business. They had the largest delivery round in the area, employing around 40 local children to deliver papers, most who now have children of their own. They had a zero tolerance approach to lateness and poor performance but made a point of writing detailed references for them when they left for university or for their first ‘proper’ jobs. (Retail remains a great grounding even for those pursuing other careers, something Gen Y should surely be made aware of?)

After 25 years of 5am starts, 364 days a year, my parents retired and sold the business as a going concern. 8 years on, the shop has declined significantly – it is poorly stocked and shabby. Yes, market conditions are extremely tough and there are setbacks – the pub across the road has introduced Pay and Display parking which has affected the passing trade which the local shops benefitted from. However, the owner seems to have given up and the future looks decidedly grim. As my Dad said the other day “it’s not rocket science, you just need to think about what your customers need and adapt” however I think this simplifies it too much. If you really know retail and have energy and passion, then yes, it is relatively simple but that still doesn’t mean it is easy. You need to have the commercial nous to identify opportunities and get more from less, whether you are in a large multiple or a local newsagent. Running any small business is tough and in retail even more so. Being self-employed isn’t an easy option and, as in the retail industry as a whole, you have to have the right skills to succeed: commercial acumen, resilience and passion as well as an unwavering work ethic. As a recruiter, I know only too well how rare these qualities can be.

Clearly, the changes in the retail market are affecting everyone including the most cherished of brands and this is the new reality we must all accept. However, when I think about all the talented retailers who have been made redundant in recent months, I can’t help but wonder what they could achieve with ‘our’ little shop. What impact would it have for our economy if our ‘nation of shopkeepers’ had decent retail experience and we could find a way to harness the skills of the many individuals that have been displaced?

My parents are powerless to prevent the decline of their life’s work (and my Grandfather’s before them) and it is heart-breaking to see. However it is the brutal truth that, big or small, if you aren’t able to adapt, innovate, and do it quickly, the market will find a way to seal your fate. The challenge for all of us who love our industry is to understand this new landscape and do whatever we can to adapt, create new opportunities and ensure that these ruthless market conditions do not find us wanting. Above all, we must keep the faith!

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By Jez Styles, AdMore Recruitment– Specialists in Retail and Hospitality Recruitment, Search & Selection, Talent Management and Career Development.

You will have read this morning that HMV has entered in to administration with the potential loss of over 4000 jobs. This is deeply sad and on the back of the collapse of Comet and Jessops in recent weeks it is perhaps the worst period in retail since the demise of Woolworths. Much of the commentary on HMV would suggest this is a result of structural failure, that the model simply has no place in modern retail. In my view this is rather simplistic. The reality is that HMV has faced a set of unique (in their combination and complexity) challenges that have served to paralyse the business over a period when change was crucial.

HMV’s demise can be traced back to the original stock market flotation in 2002. There is a conflicting argument as the reality is that the funds generated from the float served to fuel HMV’s expansion and competitor acquisitions. This expansion allowed HMV to build the best economies of scale in their market and to be the last man standing (Our Price, Virgin/Zavvi, Woolworths, Silverscreen, Sanity, Borders, MVC…the list goes on). However, being a PLC also presented the Management team with significant barriers to future proofing the business.

At the same time HMV was floating in 2002, BT had just 136,000 Broadband subscribers and additionally Apple’s IPOD had recently launched in October 2001. There were some predictions about how these two products would affect the market but in truth very few people predicted just how quickly they would be adopted. Broadband offered consumers an opportunity to not only browse products in a different way but also to consume them differently. Many critics of HMV have suggested that they should have launched a download service earlier however in reality there was stiff resistance within the wider industry. The Wild West days of the noughties and the plethora of pirate websites where you could download unlimited amounts of content for free initially pushed music and film companies to further retrench their position (on providing official channels). By the time they had realised the tide was against them, Apple amongst others had taken up the mantle (Apple were not really associated with music/film consumption before 2002). HMV have been playing catch up ever since and the brand had been severely compromised as a result.

The pirate websites also revealed an unsavoury insight in to our own cultural acceptance and views on theft. Unfortunately many people did not see illegal downloading and CD/DVD pirating as morally wrong. How often did you see individuals selling pirated product, unchallenged in pubs or street corners? I suspect this cultural acceptance is entrenched in the mix tapes of the 80’s and the romanticism that this still evokes. This created two major issues for entertainment retailers – lost revenue and erosion of what consumers were prepared to pay legally.

In 2002 it was not uncommon to pay £13.99/£19.99 for a Chart album or film and much more for older back-catalogue products. Today you will often see the same products on sale for £7.99/£13.99 respectively, or less. This is quite a dramatic price deflation when you consider that over the same period a loaf of bread (800g) has risen from an average of 60p to £1.30 today. The price deflation was deepened by competitors running loss leaders in a bid to survive, the market entry of the supermarkets and finally internet shopping.

During the same period of price deflation there has been a very real increase in costs. Payroll has continued to rise and unfortunately HMV has an expensive supply chain model. The cost of getting products on the shelves is much more expensive than it is for a Supermarket with employment-as-a- percentage-of- sales being close to double that of the Supermarkets. A typical HMV store has significantly more SCUs (product lines) than virtually any other similarly sized retailer. Each SCU has to be processed and put on shelves individually, a time consuming exercise but an essential one if you want a wide selection. The only way to have reduced this cost would have been to move this back-catalogue purely on-line.

This however was also extremely problematic. In the early days online retailers were making very little money. Amazon ran at a loss for many years…without paying much tax. HMV were in a tricky situation on two counts.  Moving their online business off-shore would attract negative press, a consumer backlash and a legal minefield. This coupled with a reluctance to under-cut the physical retail pricing model meant that the website failed to gain momentum. By the time that ‘perceived’ consumer sentiment had begun to soften, HMV had fallen too far behind. This is clearly a huge mistake but to some extent an understandable one.

The stock market- fuelled expansion brought further issues. Growth was fundamentally underpinned by store expansion with over 100 stores opened in a 5 year period. The dynamics of the market dictated that expensive leases were signed and for long periods.

The way in which we consume entertainment has changed dramatically over the last 5 years (Permira bid over £800 million for the business in 2008). I myself use SKY+ to record TV series to watch at a more convenient time while I download films directly via Apple TV. I download and play the occasional game on my smart-phone and stream music via Spotify. I still buy CDs, I love browsing and physically selecting products but not in the same quantity that I did in the past (having children hasn’t helped to be honest). The market has also changed significantly. The music industry is continuing to move towards singles rather than album releases while Hollywood is not producing blockbuster films in the same quantity that they did prior to the recession.

When I visit an HMV store I get the sense that they have lost touch with who their core customers are and could be by trying to appeal to everyone. They desperately needed to radically overhaul the product offering. They have made some inroads into the technology market but this is a relatively low margin arena and is not enough to sustain stores of their size (neither big enough nor small enough). The appetite to pursue this further has not been there and this has been driven by a Management team with either limited vision or who are constrained by the PLC ownership model. Had HMV been owned by a rich benefactor I genuinely believe the brand was salvageable. I don’t think there is a place for a specialist CD/DVD retailer for all the reasons stated but there is a place for a retailer that celebrates popular culture. A combination of fashion, technology and yes, some quirkily packaged entertainment products. Had some brave decision been made earlier HMV might not be in the position it is today.

The truth is that HMV has suffered a long and agonising death, by a thousand cuts. I can’t think of another retail market that has faced the same set of challenges and in such a short space of time. I sincerely hope that someone with a passion for the brand, and some spare cash, comes forward to save what is a truly iconic institution. Just as I was finishing this blog I received the following email from a contact that I suspect sums up what many feel about this sad news:

“It really is – I’ve just been reminiscing with my boss – things like; the first tape/LP we ever bought, all the presents we bought and were given from HMV, the cool posters i used to spend hours leafing through. Of all the casualties of the current retail market, this has hit me the hardest.”

On a final note, a by-product of HMV and the overall physical entertainment market’s demise will be an increase in costs elsewhere. Expect your broadband cost to continue to rise (if you can only download your music you are a captive customer) and your satellite TV package costs to continue to rise…

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Jez Styles, AdMore Recruitment– Specialists in Retail and Hospitality Recruitment, Search & Selection, Talent Management and Career Development.

 

Photo Credit: Comet

Sadly the last couple of weeks have been somewhat of a chilling reminder of 2008 when we witnessed the collapse of Woolworths. With store closures announced the outlook for whole group looks very bleak and as was the case with Woolworths, the collapse of Comet really couldn’t have come at a worse time for all those involved, so close to Christmas. As I drove into work this morning I started to think, from a recruitment perspective, about how it may be different for those Comet employees coming to the market now, in comparison to four years ago.

Actually, I believe for many reasons those people involved with Comet are in a stronger position than in 2008. Firstly the retail recruitment market, whilst challenging, is more active than late 2008, a time when many businesses were going through redundancy programmes simultaneously and the market was flooded with applicants. Secondly, the future is looking more positive. Whilst the news streams change daily about the level of growth we can expect in 2013, we are at least talking about growth and this a much more positive picture than in 2008 when we were heading into deep recession.

I think for many reasons the recruitment market is much better prepared to help and support those coming to market than they were back in 2008. Sadly one reason is experience. Both recruiters and other prospective employers have seen a number of retail businesses collapse and are more proactive and systematic in accessing this pool of talent. It was great to see the response that Dixons gave in trying to provide employment opportunities wherever possible and this is an example of how retailers often react to the closure of these large businesses.  However, for the volume of store staff it is going to be particularly challenging to find alternative employment. Whilst a number may be able to secure temporary roles over Christmas, come January, the competition will be intense for a limited number of roles. For Head office staff, it will be dependent on their area of expertise and the extent to which their skills are transferable.  Natural competitors of Comet like Dixons, John Lewis, Amazon and Argos all have their head offices within striking distance of Rickmansworth and hopefully they will represent an opportunity for some of the Head office staff to find other employment.

With much of the headlines dedicated to the way in which the business had been run over the last year I think the market is also very sympathetic to all of those involved. Unfortunately it is still going to be incredibly challenging as the competition for roles is as intense as ever. For many of the long standing Comet employees, they will be experiencing the recruitment market for the first time in many years and the market has changed dramatically. Their ability to quickly get to grips with the market and understand the many tools and routes available will be the key to finding another position.

When I look back over my 15 years in retail recruitment, the methods have changed substantially. The days of paper applications and pages of advertising in the press are long behind us. The growing use of social media, large in-house recruitment teams and a large and fragmented recruitment consultancy market reflect the current landscape. The market is vast and confusing and knowing how to access roles and who to talk to is the first step in finding a new position. For Comet employees unfortunately it is not a case of one size fits all; where you sit in the market will determine the best strategy for you to employ.

In the mid to senior market where AdMore recruit, LinkedIn is a critical tool in assisting people in their job search. Both agency and In-house recruiters use it as a major sourcing tool and so having an up to date and accurate profile which will allow individuals to be “found” is critical.  The use of Twitter for posting vacancies is also on the increase. It is certainly a case of using every avenue available including your own network and contacts as well as those around you. Certainly with the collapse of JJB, I know a number of the Senior Managers were very proactive in supporting their teams with recommendations and introductions to their network of contacts. I cannot emphasis enough how important it is that candidates understand how the market works and how to get the best from it.

A few useful tips can be found here

Overall, whilst the market is still tough out there, it is arguably not at the depths it was in 2008, with a brighter future hopefully ahead. However, as the economy continues to struggle, with consumer spending under pressure and the on-going structural changes which continue to affect retailers as they become more multi-channel focused, my fear is that unfortunately, this won’t be the last major retailer to collapse.

Russell Adams

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