This is one store. Or rather it is one big store with some little offsprings (mainly in Airports). It would not be my store of choice but in the last financial year it has achieved a turnover of £2 billion. More importantly, it has increased its operating profit from £178 million to £253 million. A staggering achievement for a retailer, at the top end of the market in a tough climate, weak pound, Brexit gloom, and much of what it sells you can buy elsewhere for less. Furthermore, this its seventh continuous year of growth (coincidentally the same length of time it has not been in the hands of Fayed).
‘Why ?’, you ask. I don’t know’, I answer. Apparently nigh on 100,000 visit the shop on an average day. Not all buy. A lot come to look, some buy something small often to get a Harrods bag, but a significant number are prepared to part with large lumps of hard earned (or not so hard earned) cash. Just to boast they shop in Harrods?
It is not really just one shop. Albeit, it is the largest department Store in Europe, at 90,000 sqm of retail selling space.There are the siblings, a Harrods Bank, Aviation service and a successful online operation. Ironically Harrods moto is ….
Omnia Omnibus Ubique, which is Latin for “all things for all people”
If you visit the store you may see why this contains an element of truth. Of course, it is unique in the U.K. as a retail operation as it is also a tourist destination. Walking through Harrods, you will brush past Sheikhs, Oligarchs and window cleaners.
Yet there are, if you look hard enough, some reasoned commercial rational behind their success. No doubt the change of ownership from the infamous Egyptian to a Qatari sovereign fund helped. He sold , or so he claimed, because the Company pension fund trust refused his demand for his huge dividend requirements. I suspect not having got his place in the House of Lords (Lord of Fulham or Kensington,who knows?) had an influence.
It knows what is, it understands it’s heritage and does not try to cut corners in continuing its development and reinforcing the brand. In the last year alone it has spent approximately £55 million on refurbishments, and it is not stopping there. The company values are British, luxury, service, innovation, and sensation. Whilst finding the service bit , somewhat haphazard at times , it probably hits the spot with the rest .
Despite the doubts about service, a lot of effort and resources have been invested into staff and management training with an emphasis on employee engagement and involvement.
And..so what? Well done Harrods ! I think there are fundamentals that could be applied to most retailers, and businesses in general . Understanding and having confidence in your business .Investing in the business and staff, innovating (a word that keeps cropping up) and allowing the business to develop without loosing its identity. I find it difficult to quantify exactly what I mean because it sounds a bit ‘airy fairy’. It is probably easier to illustrate by highlighting the failed high street retailers , that tried to change and did not make the investment, too little and too late .
Woolworths …..lost their way, and forgot their heritage. A value for money store that failed whilst discounters (value for money stores) flourished. Everybody cried, but nobody visited the stores.
MFI ……the first with flat pack furniture,but failed to invest and innovate (shucks that word again) crucified by Scandinavian innovators with flat pack.
And even Blockbuster……..should have come to the conclusion that heritage was the watching of films not the rental of videos . They should have had every opportunity to be a Netflix .
Have a look at the following link and draw your own conclusions…
Perhaps it would mean more if we said
If it glitters …it is not always gold…