1. TRADING IN TRADING HOURS
Everyone, it seems, has a somewhat entrenched view about trading hours.
Opinions and positions on the issue differ, often appreciably.
Self-interest is conspicuous.
Some commentators and players advocate retention of the status quo; others promote extending trading hours, whilst there is limited support for a total deregulation of legislative provisions.
Consumer interests, benefits and advantages seem to get lost, if not overwhelmed, in the mire of emotive expressions.
There is much to commend the principles and virtues of choice. However, like most things in life, it needs to be tempered with measured consideration and balance.
Major global and national entities tend to uniformly highlight the virtues of extended trading hours. It is contended that the fixed costs of rent can be amortised over a greater spread of hours. Resultant, greater economies will lead to enhanced efficiency and productivity. Consumers are accorded heightened convenience.
Conversely, small operators defensively want the “even-playing field” status quo to be retained. In the spirit of things they seldom apply a spirit level to quantify just how even, level or flat the playing field is. Even the Lord’s Cricket Ground, London, could be deemed to be “relatively” level on those bases.
In recent times a now tarnished, diminished 24-hours-a-day, 7-days-a-week convenience store network in Australia began conducting a review of operations, with consideration being given to reducing the trading hours of some franchised outlets.
Apart from questions about the efficiency of the business model, due recognition must be given to the concepts of economies of scale and the diseconomies of scale.
What is apparent is that no one rule, standard or provision applies equitably to all. Appropriate trading hours will be determined by local demand, competitive circumstances, product/service ranges and other key variables.
Universal application of restricted and unrestricted trading hours has both been found to be deficient in a broad spectrum of categories and classifications.
The ultimate objective will be balance, a measure which is subjective and selective. It is an objective worthy of discussion.
2. SELF-INDUCED UNDERPERFORMANCE
Input from Sherlock Holmes was not necessary. Evidence was widespread and conspicuous:
- Low conversion rates
- High price sensitivity
- Lack of loyalty
- Filtered access to decision-makers
- Intermittent return of emails/telephone calls.
- Tardy follow-ups
- Isolated follow-through
- Falling recommendations and referrals
The documented facts were compelling …- and disturbing. This was, and is, a crime, all too common to businesses.
The perpetrator and the causes? A clear profile emerges in answers to the following questions:
Are you guilty of:
- Not being readily accessible?
- Not responding promptly to emails, texts, telephone calls and personal visits?
- Not personally accepting contacts form customers associates and suppliers?
- Not having sufficient people and resources to fulfil client and customer expectations?
- Not providing value?
- Not ensuring high quality, timely service?
- Not following up a deal with expressions of gratitude?
- Not valuing personal relationships?
Customers can be, and are, selective. Those in business can’t afford to be, – if sustained success and profitability are the objectives. Time-poor? Get over it, and invest in relationships. All too often underperformance is self-induced.
3. BRAND-SWITCHING TRIGGERS
Increasingly, consumers and corporate clients are less mobile and promiscuous in their buying patterns. That is not to suggest that they have become “rusted-on” loyalists. Anything but!
Individuals and purchasing managers are exhibiting similar characteristics. They are unapologetically and persistently questioning prices, requesting price reviews and consistently seeking out alternative products, services and supply-sources.
They are receptive to proposals from new and competitive entities, and have the time to evaluate those proposals. However, there is little evidence of widespread migration of businesses and purchasing.
Interesting Mix: A receptive mind and yet a reluctant attitude. That does not imply contradiction. Rather, it suggests a lack of attractive and compelling reasons and justifications to conclude a decision to change ….- brand, product, service and provider.
Established suppliers cannot be complacent. Clients may not be judgemental, however, they are reflective and many are being pressured because of market forces.
Relationships do count, but not past performance. Everyone and everything are being held to account, and customers are extending the practice throughout their networks and supply chains.
More than ever before, price competitiveness must be complemented with enhanced value offerings.
ELUSIVE NEW CUSTOMERS
Those seeking new clients and customers confront an interesting scenario. Overtly positive responses to canvassing and new business strategies all too-often falter because of a lack of urgency and follow-through. Latent potential remains that way … both – latent; and potential.
Clearly, there are barriers, filters and impediments impinging on the purchase decision process.
Significantly, disappointingly and disturbingly, price has been elevated in the set of purchase decision criteria
In some instances, it has assumed the role of “condition-precedent”. That is, there must be clearly defined tangible, quantifiable and immediate rewards, benefits and advantages for any proposition or submission to be given genuine consideration.
High-order merit and importance are retained for criteria like convenience, punctuality, quality, competitiveness, consistency and continuity. No ground is ceded. Customers and clients have become, and will remain hard task-masters.
For other instances, price advantage is the qualifying, or closing factor in negotiations.
Having established that all other factors are not equal, there must still be a price advantage, intrinsically linked to time.
Financial benefit which slowly and progressively accumulates over an extended period of time holds little appeal and, in recent times, has a poor record of success.
The convergence of two marketplace forces, cashflow and the presence of Nowconsumers and clients, effects a formidable presence.
BUT WAIT … THERE’S MORE
Redefining relationships, establishing real strategic alliance partnerships and facilitating more stable cash out-flows for inventory and stocking requirements have compelling appeal in many sectors, including mining, infrastructure, construction, services and retail.
So, there it is. Simple. A defined template for success and business growth, specified by a receptive, but reluctant marketplace:
- Price advantages and benefits
- Immediate rewards
- Stabilised financial outflows
- Restructured mutually rewarding relationships
Some will conclude and contend …..
Same ol’, same ol’
Not at all.
Any suggestions of complacency, sameness, repetition, and stagnation are toxic, and will be triggers for brand-switching decisions.
4. BE SELECTIVE
Some considered advice.
In all things business, be selective, particularly now.
Reality is that only now are many people realising that Australia did not avoid the consequences of the Global Financial Crisis (GFC) that unfolded in August 2008. We simply delayed the fallout, at considerable cost and with lingering national debt.
The mining sector downturn and the prevailing rapid declines in the Shanghai stock market and the Chinese economy were predictable, and predicted. Why wasn’t everyone listening?
Those who have recently and selectively sold overpriced real estate and shares are now liquid, awaiting the opportunity to buy – at depleted prices.
The call is not to “get back to basics”. No, one should never leave the basics.
Greater respect needs to be given to fundamentals.
For example, in business, one need not be selective to appreciate the advantages and benefits of income exceeding expenses.
Alas, the prophet of profits! Prudent debt ratios should always be pre-emptively determined, monitored and respected.
Staff ratios, inventory stock-turns and sales conversion ratios need to be achieved and maintained to ensure optimal productivity, competitiveness and financial viability.
All strategic business plans need to address and analyse comparative and absolute market positioning, presence and relevance.
Only then can pertinent goals, objectives and targets be set and pursued.
BRING TO THE TABLE
Information and, to a lesser extent, intelligence sources abound.
Many are cheap, or free. That may reflect their value.
It’s important to be selective, and to evaluate the worth of information sources.
I am provided the opportunity to be exposed to many speakers at the conferences, seminars and conventions to which we provide customised keynote presentations.
Similarly, I always endeavour to attend appealing public events.
Increasingly, I am becoming selective.
On issues of business, I evaluate what the speaker or speakers can and will “bring to the table”.
Creative, original and relevant input and perspectives are greatly valued.
However, in these challenging times it is important to question what it is that elite sporting stars, high-profile coaches, reality-TV celebrities and low-ranking, highly decorated military people offer business leaders, team members and businesses.
Each doubtless has a story to tell to the right audience, in the correct setting. End-of-season events, book launches and community gatherings welcome “feel-good” contributions.
For me, businesses and business people need to take a hard, objective, detached look at the marketplace and themselves and to seek and gain benefit from those who have been selected because they can and will make a difference.
A bold and reasoned projection will establish the veracity and time-lines of this text, and its underlying contentions.
In the coming months and years, particularly within a 3 year span, many businesses and business owners will be subjected to pain, shocks and set-backs. “Black Swan” events should be anticipated.
For some it will be a terminal experience.
A typical reaction is to seek out a “guru”, a “silver bullet” or an economic panacea. They are few in number.
Fundamental to continuity, persistence, sustainability and growth will be recognising, respecting, adhering to and implementing the fundamentals …- which may be particular to a given marketplace, sector, industry or entity.
A sound first step will be to be selective.
5. THE BIG LIE – NO EXCUSES
Scandal. Fraud. Scam.
These are words that cause shivers in the corridors of corporations, and rightly so. Particularly, if the events and inevitable consequences are self-induced.
The Volkswagen diesel engine emissions imbroglio, in which on-board computer monitoring was deliberately set to under-report emission levels, is a striking example of appalling leadership and a poor, if not toxic, corporate culture.
It seems inconceivable that anyone could believe that a deliberate lie involving some 11.8 million motor vehicles and hundreds of thousands of Volkswagen employees around the world could remain hidden.
Once recognised and reversed, the consequences for Volkswagen of the scandal have been immediate, widespread and cascading. The “fall-out” will doubtless continue well into the future. Reputational damage extends beyond single brands. Individuals, nations and sectors will suffer the odium of reputational stains.
This case study highlights the complexity of the principle of “unintended consequences”.
Volkswagen is the largest automotive manufacturer in the world, employing over 300,000 people, generating 206 billion Euro in revenue each year, and being owner of the Audi, Skoda, Bentley, Bugatti, and Lamborghini and Porsche brands.
Germany, its people and economy will be profoundly and directly impacted. One in seven of the workforce contribute to the production and export of motor vehicles. The Lower Saxony municipality owns 20% of the shares in Volkswagen and seeks regular and consistent dividends. They too will doubtless take a hit.
Questions will be put about the integrity of all things German, with probable detrimental influences on revenues.
Within two weeks of disclosure of the scandal, the resale value of all Volkswagen diesel vehicles in the United States of America had reportedly fallen by around 20%. That represents a large pool of disenchanted financially disadvantaged customers. It will probably get worse.
Satisfaction, loyalty, respect and referral business are concepts that will carry little currency into the immediate future for the Volkswagen group of companies.
The Chief Executive of Volkswagen has resigned with possible legal action pending. Two other senior executives have been dismissed, and a further trimming of the ranks is probable.
Search for a replacement leader has begun. Any trepidation about a poor record of external appointments of leaders for Volkswagen will be tempered by recognition that the current crisis is presumably a by-product of a negative, corporate culture.
Internal promotions and appointments would seem inappropriate to government, regulatory authorities, shareholders and customers.
The inept actions of many Volkswagen decision-makers beggar belief. What were the real long-term advantages and benefits? Any short-term beneficial outcomes were, in reality, false economies.
Greater respect was needed for the long-earned and justifiably commendable reputation for engineering excellence, reliability and value which had long been associated with the brand. A heavy price has already been paid, and will be paid well into the future.
7-ELEVEN … ZERO
In Australia, the image and standing of the 7-Eleven convenience stores franchise network have been figuratively trashed.
Seemingly widespread, if not systematic underpayment of employees is inexcusable and unjustifiable. The image of poor treatment of “back-packers”, “short term tourists”, casuals, Indian nationals in particular, will have fall-out in the international standing of Australia, the local franchise sector, convenience store operators at large, corporate Australia and many business operators.
We deserve better than that, and should not suffer from the actions of so few.
In recent times the 7-Eleven Chairman, Chief Executive and Chief Operating Officer have each stood down or resigned.
The Deputy Chairman on the Board of Directors has been promoted to Chairman. However, he has reportedly been on the board for some 16 years. Therefore, he was present when the inappropriate actions took place. It is not a good look!
The same individual was the National President of the Australian Institute of Company Directors, whose charter is to promote ethical corporate behaviour and good governance. He either “stood aside” or was asked to “stand aside”. Rightly so.
What measure of confidence will 7-Eleven franchisees and the disaffected, reportedly underpaid employees feel?
He was also Deputy Chairman of a publicly –listed national network of motor vehicle dealerships. He recently made public he is standing down from that position. What has not been publicly addressed is his chairmanship of a transport company. Actions do have consequences.
Consideration must be given to the interests and concerns of shareholders, staff members, suppliers, associates and clients of that and other entities. The lessons apply to all.
In the current global digital and open marketplace there is, seemingly, no place to hide.
There are four prevailing dominant forces in the marketplace. Each must be addressed, positively and proactively, being:
The innate fears and risks associated with big lies will mitigate against ever attaining the exalted status of being trusted and accepted for one’s integrity.
Today, as forever, there are no “white” lies or little fibs. Lies, and their consequences, are big.
There is much to commend the virtues of walking the straight and narrow line.
Barry Urquhart is a marketing and business strategist, facilitors of strategic planning workshops, top-selling author and a high-impact conference keynote speaker.