Ellie Sanderson continues to address the current climate for bridal boutiques, and discusses how to move with the times to ensure success…
In the July/August issue of Wedding Trader I wrote about Debbie Buck, owner of Glamour Bridal in Bolton and her decision to close her boutique. I interviewed her about the changes in the industry and retail in general that forced her to make this major decision. I had a number of emails thanking me for lifting the lid on such a taboo subject and making it less shameful.
This month I want to pick up on the key issues Debbie faced along with the worries that retailers have highlighted since this article.
Sadly, I wasn’t surprised that this article struck a chord with so many retailers. Right now we are trading through the Retail Revolution and major change happens monthly.
Retailing has always been about change and attracting customers with new products and looks. But today’s retail world is changing in a way we have never seen before. Staying ahead and keeping ahead is way harder than it has ever been.
More and more fashion businesses close and so do bridal businesses. Surprisingly, though, just as many seem to open, believing they can do it better. With the boost of start-up cash, heaps of enthusiasm, no hefty stock commitments or liabilities it seems easy.
But by year three the back-log of stock is apparent, the liabilities to invest in new stock are a real pressure and it starts to feel a lot harder. Making a living becomes tougher and the dream turns into a matter of pride to keep going.
The reality is that our consumer is behaving differently and believes they are empowered to shop wherever and whenever they want. They are no longer being dictated to by the old norms.
A staggering 49% of general retailers have said that is now difficult or very difficult to predict how their customers will spend over the next 12 months (source: Inside Retail). This is also applicable to bridal retail. What used to work, no longer works and what should work is often impossible to achieve.
I took the opportunity to chat to those retailers who emailed me on this very topic and how it was affecting the bridal market. Most agreed that the business model they set out with is no longer applicable and in most cases no longer working. The majority were united in their views and those views were very similar to the reasons that Debbie decided to close her doors.
We talked about key areas… THEN and NOW.
Five years ago they were brilliant footfall drivers; they created excitement and conversion rates were strong on the day as boutiques offered incentives. They were a great boost to cash flows and a brilliant team motivator creating energy and urgency to buy. They felt special and exclusive.
- The market is saturated with them and they are no longer perceived to be special. This means they are poorly attended.
- Because the market is saturated there is no urgency to buy. Retailers are also less likely to give discounts as costs and margins are so very tight.
- Add to this that some designers now charge to borrow samples to achieve sales of their dresses and it is not financially viable.
Conversion rates are at an all time low with revisits at an all time high. This has a massive impact on staff costs, operating time, over-heads and staff morale.
- 12 years ago when I opened we sold to every other bride and we also closed a sale on every retry booked (often it was higher than this).
- On average it took us four hours to sell a £2k dress. Then a further four hours to style and fit.
- Today it takes us six hours to sell a £2k dress and often five hours to
style and fit. Trust me, my team are the best I have ever had but brides are coming back for two or three retries with more and more friends before they will decide. They are also having more wobbles at fittings and styling.
- In crude terms if a shop sells 100 dresses a year it used to take 800 man-hours to sell them. Now it takes 1,100 man-hours to sell them.
- That’s an extra 300 man-hours a year. With an average pay of £10 per hour that’s an extra cost of £3,000 per annum. That is huge… and just slips out of your profit almost un-noticed.
SALE DAYS NO LONGER WORK
Sale days were always a fast cash boost and a way to clear the space for the next collection. Conversion was often high as girls who couldn’t afford a full price dress flocked in to buy one at a discounted rate.
- Sale days are more often than not poorly attended, the growth of low price point new dresses mean the consumer doesn’t want a sample any more.
- Wed2be, online selling channels and the second hand market have all created the lack of desire for samples.
- The market is also flooded with stock from boutiques that have ceased trading, pop up stores and outlet stores.
- Sample buying is a critical part of keeping our stock current. It’s also a critical part of keeping our designers liquid. Sadly, designers with high minimums are seeing retailers having to walk away from contracts especially if the samples are repetitive. Our inability to shift the old samples is killing most small boutiques.
- Choosing the right people to work with has always been key. Trust, integrity and a united approach is crucial for everyone’s success.
- Expectations to buy lots of samples at Harrogate were always on the agenda and nearly always achievable by the retailers.
- We enjoyed buying at one or two shows, twice a year.
- The market is saturated with shows across the UK and Europe.
- Retailers have to expend huge amounts of money to see all the labels they stock.
- As sales change due to the above factors we all need to adjust our expectations and that includes minimums – currently there are retailers terrified of not buying minimums incase they get the chop by the supplier. This is FACT.
So what’s the answer?
Retailers need to buy less labels and commit more to the best-selling labels. That way our suppliers will support us in return for our loyalty to their brand. Why plan to carry 70 samples with 10 labels when you know you have to buy 80 per annum. I have 65 samples per shop with five labels. Commit to a less-is-more policy.
Don’t be afraid to drop accounts that don’t hear your issues and work with you. Trust me on this. I have closed accounts with some of the biggest brands and I am still here and still selling. Be confident in your own brand being a thing, too!
Our suppliers need to deliver product little and often in order to respond to the changing market place.
We need to up our game with lead times especially at designer level, runway to retail sitting at six months is not an option any more.
Our suppliers need to say NO to new boutiques that want to open and challenge areas of exclusivity – they only gain once here and that’s from sample selling.
Equally, if a supplier has a retailer ‘hogging’ a label then they should be bold and move the account on. It’s too tough to keep accounts going for history’s sake.
Our suppliers need to consider a swap-out scheme on dresses that simply haven’t performed.
Our suppliers must and do perform credit checks on retailers and so must all retailers do the same. Believe it or not, most retailers are not insured.
The list is endless; the key point I want to leave on is this: If you feel vulnerable with low sales, poor appointments, high stock commitments and big overheads it may be time to review your plan;
just because it worked in the past doesn’t mean it will in the future.
Don’t be afraid to seek professional advice. Often you can be too close to the situation to evaluate it without emotion.
It may be time to restructure for the future – do it now without delay.
Change can take months to come into play.