To Mask….or Not to Mask? A very serious question.

Unashamed bit of product placement ! This should sort out a bit of protection. This will get the High Street moving (but perhaps not in the way we want). But it would look great on a Zoom (there are other makes of online Video Meetings !) Meeting.

This is not about the rights or wrongs of wearing a mask . If science says that it is of benefit then I accept it. It is not about our personal freedoms or civil liberties, if wearing one protects others then we should. However, why haven’t we been told to wear them 4 months ago. Why was it not made mandatory immediately as opposed to waiting 3 weeks from shop opening? Businesses were already prepared, it is only the consumer who had to get prepared (like go and buy one. That said there is huge confusion as to what sort of mask actually works and what not to do if you do wear one) ). The science evolves so say the Government. Well how come it evolved a darn sight quicker in the rest of the world.

My argument is to look at the reason why they have come up with this late stage retail requirement and its possible impact.

I can think of only 3 possible reasons for the mandatory wearing of masks within stores:

  1. Public safety
  2. Political
  3. Economic

One hopes number one is paramount. Well, as we all know you don’t have to wear them in bars or restaurants; somewhat impractical. However, if there is a risk of infection you are likely to spend a lot longer in a bar or restaurant and even with social distancing more likely to have interaction with strangers, than you are in a shop. The new regs state that store staff don’t have to wear them . If we are to accept the science that the mask is to protect 3rd parties are we to assume that store staff are less likely to have the virus than the store customer ? I don’t think science has made that claim. So I am not convinced that Public safety is number one or if it is then I think this a bit arse about face. Which of course would surprise no one.

If it is number 2 , Then I am perplexed as it can’t see much political gain here. Perhaps there is enough pressure about the Government’s mixed and cockeyed messaging that they thought they should align with popular opinion. Assuming popular opinion believes that it is a good thing.

Number 3 sort of makes sense, if they think that it will give the consumer more confidence to go into shops and spend. I don’t. Yes there are naturally those who are very concerned about their unmasked fellow shoppers. Yet my gut feeling , and subjective research suggests otherwise. Non essential shopping is partly a leisure activity and I am pretty certain it will stop the consumer going for leisure or casual shopping if it involves masks.

It’s the don’t have to , and it is not much fun so I will get it online attitude , that will only push more consumers back onto online and not go into the retail store. There will be, of course, those who will be more confident in a masked up situation, but I still feel they will be far outweighed by thinking I really don’t need to do this. So I wont.

There is a lot of confusion out there with the consumer, and this is not helping and one thing about which I am pretty sure it will not help the retailer.

My Annual Trip to Plagiarism…..

Same time, slightly different subject , same author (plagiarised) , same reason for plagiarism (I couldn’t write it, apart from the content she is far more literate, articulate and coherent than I could ever be ) and as with the last time completely ‘left field’.

This time last year I pasted and copied an article by our Daughter, and I make no apology for doing the same again this year . The subject is different but the context is no less relevant and poignant.

I hope she writes one at the same time next year or my annual plagiarisation, will cease to be that….Annual. She will have her father to answer to, if she doesn’t. As if that would make any difference.

Today would have been London Pride with the now standard parade and celebrations of the LGBTQ (lesbian, gay, bisexual, trans and queer) community. Covid 19, if nothing else, doesn’t discriminate (well it does a bit) and this event has now been cancelled restricted to online celebrations. I rarely post however, like last year, would like to use this day to share my reflections on Pride.

Last year I wrote about my personal experiences and why Pride is still important beyond the, perhaps more light hearted, parade in central London. This year I will be briefer and wanted to touch on the importance of being an ally and what this actually means. I also think this is relevant and intersects with the current spotlight on Black Life Matters (BLM) and racism. I have attached a recent video article (5 mins) from the Guardian on White Fragility and how this forms a barrier to effectively tackling racism.

As a white English person it is my duty and responsibility to listen to this and learn. I may be a Guardian reading social worker (without owning a pair of Birkenstock’s I will add) but that doesn’t mean I’m blemish free of any unconscious prejudice and bias. I’m human after all and it would be worrying if I said I was free of any prejudice. What is important is I dig deep, acknowledge these, own it and then work to tackle them.

To be a true ally it means, that as the person in the position of ‘societal privilege’ (in my case as a person of mainly white British ethnicity and cultural background) the responsibility is on me to not be defensive as the majority and to use that very privilege to break down all embedded racist structures and, ultimately, to remove the privilege I hold to make way for true equality. To be an ally it is not good enough just to say ‘I’m not racist/homophobic’, to display meaningless images on social media as acts of solidarity; to pretend that you don’t see colour or sexuality; or to pretend it doesn’t exist because you haven’t experienced it (it’s likely you won’t when you are in a privileged group).

To be an ally means actively challenging any form of racism/homophobia as you witness it or hear others experiencing it, it means not colluding and ignoring it because it protects your privileged status or because it’s too uncomfortable to challenge, it means asking your BME or LGBTQ friends/family/colleagues about their experiences and what you can do to support them, it means using your privilege to dismantle your privilege, it means having the guts to stand up for others even if it doesn’t always benefit you. If you cant do these things then it is your right – but you are certainly no ally and are part of the problem. I would also ask you to question yourself if you only stand up for one section of people or disadvantaged group and not others why; tackling inequality is not a pick and mix opting only for the one which makes you less uncomfortable maybe.

If you want to be a true ally whether this is against racism, homophobia, transphobia, sexism, or any other form of prejudice against a disadvantaged or disempowered group of people then take ACTION. ACTION NOT WORDS. Words are meaningless; actions have a purpose and enact change.

Happy Pride Inside 2020 – on being an ally not lip service and the fragility of the privileged.

Today would have been London Pride with the now standard parade and celebrations of the LGBTQ (lesbian, gay, bisexual, trans and queer) community. Covid 19, if nothing else, doesn’t discriminate (well it does a bit) and this event has now been cancelled restricted to online celebrations. I rarely post however, like last year, would like to use this day to share my reflections on Pride.

Last year I wrote about my personal experiences and why Pride is still important beyond the, perhaps more light hearted, parade in central London. This year I will be briefer and wanted to touch on the importance of being an ally and what this actually means. I also think this is relevant and intersects with the current spotlight on Black Life Matters (BLM) and racism. I have attached a recent video article (5 mins) from the Guardian on White Fragility and how this forms a barrier to effectively tackling racism.

As a white English person it is my duty and responsibility to listen to this and learn. I may be a Guardian reading social worker (without owning a pair of Birkenstock’s I will add) but that doesn’t mean I’m blemish free of any unconscious prejudice and bias. I’m human after all and it would be worrying if I said I was free of any prejudice. What is important is I dig deep, acknowledge these, own it and then work to tackle them.

To be a true ally it means, that as the person in the position of ‘societal privilege’ (in my case as a person of mainly white British ethnicity and cultural background) the responsibility is on me to not be defensive as the majority and to use that very privilege to break down all embedded racist structures and, ultimately, to remove the privilege I hold to make way for true equality. To be an ally it is not good enough just to say ‘I’m not racist/homophobic’, to display meaningless images on social media as acts of solidarity; to pretend that you don’t see colour or sexuality; or to pretend it doesn’t exist because you haven’t experienced it (it’s likely you won’t when you are in a privileged group).

To be an ally means actively challenging any form of racism/homophobia as you witness it or hear others experiencing it, it means not colluding and ignoring it because it protects your privileged status or because it’s too uncomfortable to challenge, it means asking your BME or LGBTQ friends/family/colleagues about their experiences and what you can do to support them, it means using your privilege to dismantle your privilege, it means having the guts to stand up for others even if it doesn’t always benefit you. If you cant do these things then it is your right – but you are certainly no ally and are part of the problem. I would also ask you to question yourself if you only stand up for one section of people or disadvantaged group and not others why; tackling inequality is not a pick and mix opting only for the one which makes you less uncomfortable maybe.

If you want to be a true ally whether this is against racism, homophobia, transphobia, sexism, or any other form of prejudice against a disadvantaged or disempowered group of people then take ACTION. ACTION NOT WORDS. Words are meaningless; actions have a purpose and enact change.

Please listen to this video if you want to be a part of change and challenge – this video refers to racism specifically but you can replace the terminology with LGBTQ and it would have the same relevance. I would welcome or love any comments but please only those that are constructive and feel they are committed to being true allies across the board. If any of this makes you feel uncomfortable or defensive, reflect on why.

https://www.theguardian.com/world/video/2020/jun/26/how-white-fragility-obstructs-the-fight-against-racism-video-explainer

I, me that is, do have a small issue with the Guardian Video , in that it primarily refers to the race issue being about black and white. And if it only were that simple or Black and white . It is far more reaching and infinitely more challenging in its complexity. However, I think our Daughter illustrates this on a number of occasions where she points to the need to highlight any disadvantaged group and not pick and mix.

Private Eye June 2020
Private Eye June 2020

The above 2 cartoons , taken from recent copy of Private Eye , I think highlight 2 key issues . The one on the left , that of there are actions and actual actions. The one on the right , all disadvantaged groups. This are my additions and I hope in no way detract from what my Daughter has written. If only I were that brave .

Intu…Now Out Too…or Atishoo…Do all Shopping Centres, as we know them, all fall down?

No they wont.

Or rather not quite.

I think that a little recent historic perspective is of help.

  1. The funding of most major shopping centres (in the UK) in recent years has been, so I am reliably informed, via debt. The debt is raised on the assumption (scientific, it is not-my opinion) on continually increasing rental income. I have always considered that is away with the fairies, but will come back to that.
  2. INTU, whilst established in 1980 did not become INTU until 2013
  3. Much is blamed on the increase in online. Whilst this is of course true , it has been true for a number of years.
  4. During Covid most shopping centres have been getting barely 25% of their rental income.
  5. Intu pointed to this (Covid) as another reason for their failure, yet they lost £2 billion in 2019.
  6. Shopping centres generally have anchors ie Department stores

1,3,4,5, & 6 are all pretty good reasons for shopping centres to disappear.

1- Whilst it may have seemed understandable at one time that there was nothing to stop Retail Rents to continue to climb, surely commercialism, realism , economics and patterns of shopping would suggest maybe not. All economic graphs have curves, for crying out loud. Moreover, historically most multiples bought their freeholds. This started to change 20-25 years ago when they decided to liquidate their assets and grow on leveraged debt. I felt at the time it was short sighted (selling their freehold assets that is ) and I still believe it.

3- Amazon is over 25 years old. This is not an overnight phenomena . What possessed the landlords to not think a change was happening. E bay slightly older ! The percentage of the retail market via online , in the UK, was 17% in 2017, and now is probably nearer 20% . So surely the signs have been there for sometime .

4- Couldn’t have seen this coming but it did (come that is ). No Plan B?

5- Speaks for itself

6- Department stores have been struggling for at least 5 years. Very relevant with the recent announcement that John Lewis is closing its Birmingham Bullring Store (see below). Its tells a lot about Department stores and Shopping Centres.

The big shopping centres and have an inbuilt disadvantage of being like giant cruise ships. They are very difficult to turn around. Whilst the more recent developments attempted to spread their desirability by incorporating more leisure facilities eg Cinemas, restaurants etc, they were and still are, shopping centres. Two years ago(August 2018) I posted about plans for an 8 Million Sq foot shopping centre in Dubai where the experience was the cornerstone. In simple terms it is about the consumer having experiences and via technology, of course, when they do buy they don’t have to pick or carry anything it gets delivered to their home. The technology might be rocket science (do you know your average smart phone has 8 million times the memory of the first space rocket- so its more than rocket science), but the consumer behaviour isn’t. The consumer likes going into a shop to touch and feel but they also like to buy online as it can be cheaper and more convenient. Just stick the two together. Simples as a the word famous and very wise Meerkat would say. ( non UK readers very famous TV advertising star -it is a puppet, a very clever one but still only a puppet)

The light blue line shows the fall in footfall in Shopping Centres to mid 2019

That is not to say this is the only answer, there never is just one answer. As there is no one answer to stop sneezing . Yet I do believe the intensity of the current environment, focuses the mind and the need to make dramatic and creative action. Without which, the consequences will be even more damaging. I think what history (retail history that is) tells us is that when push comes to shove, the retail market eventually reacts and changes. If the big landlords do not respond then they will all fall down.

The latest announcement from John Lewis closing their new Birmingham store, really brings home to the plight of the shopping centre. It is widely accepted that this was on the cards well before Covid. It has been open for five years and I believe it has struggled to ever turn a profit. This is a Shopping Centre(Owned by Hammersons ) that is in the UK’s second City. It is built directly over a brand new Inter City Railway station (New Street), there is a bucket load of parking and yet it struggles.

If any parallel is to be drawn , it is to recognise the symptoms, seek a cure, take the medicine. Just like Covid19.

The Resilience of the Humble Toy Balloon….

Lord and Lady Latex, are titles that have not been bequeathed by Political benefactors, or an obsequious senior Civil Servant but by a friend who has also spent much of their working life within the same industry, and felt that for most of the time he had known Julia and I, we were flogging the odd latex balloon or two. The emphasis being on latex , which is also relevant to the context of this post.

I need to indulge a little and talk briefly about my working past as it will , hopefully, help to illustrate what I am going to say.

Travel back a long way, to a time when Mylar (foil) balloons did not exist , before Balloon Decorating started , pre huge colour ranges, and multiple sizes, to a time when the humble Toy Balloon was considered thus… Just a Toy. I was brought up with them. I was surrounded by them , not literally as I rarely saw one in my youth,almost certainly never in the house, but metaphorically. My parents lived and died Latex Balloons. Sounds quite odd and dark, but it is a lot simpler than that. They were involved in the manufacturing and selling of ‘Toy Balloons’. They was wat put bread on plate , wood in fire and roof over ‘ead…as Dickens may have said but didn’t, unless he had spent a lot of time in Yorkshire and didn’t tell anyone.

Even before working in the business I was often taken to trade fairs (oh yes that was a proper holiday). I participated in the Nuremberg Toy Fair before I left school. What I am trying to say is that I have experienced many an economic cycle and a myriad of unfortunate events that would have otherwise destroyed the market for lesser product.

From the miners strike in the early seventies, the oil crisis mid seventies, and rampant inflation(edging to 26%)recession in the early eighties, recession in the nineties, to the banking crisis and finally our present covid conditions, nothing has dampened the demand for the humble latex balloon. During the Oil crisis in the mid seventies in the UK , there was a three day working week. I can very clearly remember at the years first trade show everyone doubling their orders. During massive inflation , having to increase our prices by over 20% being told by customers they wanted a bigger increase(not really anything to do with the demand for balloons , a rather nuanced commercial input. However, the customer was not concerned that it would stop the consumer buying). The vicious nasty little bug that cowers all before it cannot dampen the enthusiasm for the The Toy Balloon. I would go as far as to say it has only increased it. During this crisis, it would not be out of order to add it to the list(at least in the UK) of toilet rolls, pasta, bicycles, and puppies . Once again it defies all expectations.

In The early Nineties this crept back up to 15%…

Now , I must wave a red flag to any Lockdown Entrepreneurs who are thinking …aah hah There’s a few bob to be made here ….the market is not short of supply . There are plenty of manufacturers and the market is very aggressive. By dint of the product’s durability, it has already gone the distance of attracting entrepreneurs . So back off!

The latex balloon is no longer just a Toy. It is a product with many homes, backgrounds to corporate events , decorating major sporting occasions , weddings, key celebrations, lifestyle enhancer…..the list goes on. Take a peek on Instagram and Pinterest to see how balloons are used now. Consequently, especially in the UK you would rarely find Latex balloons on sale in a Toy Shop. This differs to a degree in the rest of Europe. Twenty five years ago, the go to retail outlet for the humble balloon was a toy shop, but ironically it got too complicated for the toy industry . Ranges grew like Topsy and I think they took the view that to do it properly took too much space. And they were probably right . Yet I still maintain that whilst a single sku of bog standard toy balloons ,may not return as much cash, it will take return far more % profit per square inch than nearly anything else in a toy store.

So what is the allure of this simple object ? It is not without its opponents. Over the years it has had confrontations with the farming lobby, and environmentalists. Even today many think that latex balloons are made of plastic. Clue in title, please err ‘….Latex. There are those that are Balloon Phobic. I have encountered customers who would not step onto an exhibition stand as they are frightened of balloons. Not many, I hasten to add, I can only remember two . But there again I suppose I would not meet them all as they wouldn’t have come anywhere near me .

There are few that would walk into a room full of balloons, and not raise a smile. After a short while that same person, child or adult, would defer to childhood, and want to play with them, even if it is a sophisticated decoration. Maybe because they float or have a life of their own they subconsciously imbue a feeling hope, happiness and maybe even a touch of freedom. I have a sneaky feeling this is a peculiarly UK thing (and North America) . I am not sure this has translated to such a degree into mainland Europe, though I don’t see why it wont. Balloonwise , we are ahead of the game. A customer of mine (who is very close to the action on this one ) said he saw this coming sometime ago. He saw a movement to people playing (in a craft way) but suspected it would take another couple years to go mainstream. In his opinion , Covid has only hastened the timeline.

A toy it may no longer just be. Its development into adulthood has only just fortified its resilience and maintained its humility .

Would you Buy that Doggie Sitting in the Window?

Is this an example of a retail miracle or just rubbish merchandising ?

A very crude bastardisation of the 1952 Novelty song How much is that doggie in the Window ? Sung by Patti Page.

First it was toilet rolls and pasta, now the panic buying has moved onto Bikes and Puppies. In a few months time I can foresee loads of bikes on eBay, hopefully not puppies but there are already signs of profiteering. That, however, is not what this is all about.

As I was queuing to go into the bank (as one does at the time writing) , it was a source of inspiration whilst looking in the window of a locked down independent card shop. Or rather, it wasn’t, as what I saw made me think why would you go into this store ? Yes the store was closed but centre point of the window display (I hesitate to describe it as a window display) was a child’s plush toy dog. The product did not tie in with anything else in store , it looked grubby and as any dog looks in any window, very sad.

There are stores of all shapes and sizes littering retail landscapes, that are, if not full, then stocking a load of product that really should not be there. It does not stop with retail stores as it is true of wholesalers, distributors, importers and manufacturers.

Apple created product that nobody needed, and most experts suggested nobody would (or at least few would ) buy. What Apple managed to do was to create desire and then developed need. There are very few parallels. Therefore distribution channels in all markets should be a lot more ruthless in their ranging . I am not talking here about only having best sellers . If product has a market or serves a purpose, no matter how small, it is not a rational for deleting it. There is the 80/20 rule. This states that you take 80% of your cash from 20% of your range. This does not, however, you dump 80% of your product range. The function of less popular 80% is to enhance and attract the buyer.

It is the product that serves no purpose, has no market value and quite simply has a negative impact upon your business, it should go. Within our industry (Party Market) much revenue is generated by Licensed product eg Disney Characters, Marvel Comics etc. When a successful movie is launched there is often a huge peak for the main character ( Frozen Princess product for example). However that can be very short lived. In the case of Frozen, when the next film came out the consumer only wanted the new designs. The old design becomes dead stock overnight. Now, to be honest, this is a really tough topic because you never really now when ‘The shows over‘ so to speak. That dead stock can drain any profit made when it was hot. Moreover, it is more easily identifiable by the consumer as dead stock.

Certain retailers are more exposed to this issue than others. It is rarely an issue with any grocery outlet as most of the time their stock is limited by sell by dates. Yet they tend to be the exception rather than the rule. Old stock whether defined by its age, fashion , poor sales history or just plain rubbish product does nothing to help a retail store. It has to be taken out of the business and a basket with a hastily printed sheet saying must be cleared, everything 50p is neither a good look nor an effective process.

At a time when we could go into shops, all of us will have experienced that moment when you are thinking what, on earth, is that doing in this shop? or how long has that been here ?

I have just had conversations with a customer , who having been in their current location for three decades has cleared all the stock out of the store and decided that when it can be reopened , everything will be fresh and new . A glimmer of hope , but only a glimmer. I am concerned a lot more will rely on old stock (because of financial constraints), fear of the unknown, or pure and simply going back to their old ways.

A word of caution. If you are in the process of restocking and your supply chain offers the once in a lifetime super deal on certain products. Just ask the question Why? Is it, perhaps, from their metaphorical must be cleared, everything 50p basket ?

In the current climate it is so important . The consumer will not bother going into unattractive stores and they will not be interested in looking at rubbish stock, not that they ever were. But now is the perfect time to look at what you have (and don’t have) and ask yourself

Would I buy that doggie sitting in my window ?

Is the Price ever Right ?

For me, Yes ! Just the once . I married one . A Price that is .Julia’s maiden name is Price.

For the rest of the commercial world ‘Pricing’, is probably the simplest, yet pardoxically the most complex part of the equation. You buy something for X and sell it for Y. But how do you know if X or Y are the correct value. From the manufacture of the product right through to the consumer, we are never really sure if it is the right price.

Vast tomes have been written about Pricing Strategies. To illustrate I thought a really confusing diagram would help.

Found on Linkedin, not sure of the exact source

I think the complexity can be better shown with the example of a Watch. For fifty quid (for non UK readers that is £50) you can buy a reasonable watch which will tell you the time , date if you want and might even be waterproof. For £50,000 you can buy a watch which will tell you the time , date if you want and might even be waterproof. So why spend £50,000. There is an argument for jewellery, ascetics and of course vanity . Yet in Northern Europe, we spend most of our times with our arms covered up, so nobody sees it, seems a bit pointless. When they are uncovered you are in danger of having your arm chopped off , if you are mugged . The other arguments are ???

Bizarrely, there is only a multiple of approximately 10 when considering a Ford Focus against a Rolls Royce( £15,000 vs £150,000) where the differences are some what more obvious. What it illustrates is that the process of pricing is not that straightforward. If the Ford Focus had exactly the same spec as the Rolls, and was 20% cheaper, the price would still not be right. But that doesn’t work for a watch for most onlookers a £50,000 watch may look and function in exactly same way as a £50 watch.

There will be many of us who have entered into successful negotations for a siginificant contract, being content with the price achieved, only to be find later on that it does not stop there. Please note I have not said buying or selling . With selling , post negotiations, you can be faced with retrospective discount requests, marketing contributions , advertising allowances, special promotional prices for a period. Making your original Right Price seem rather less Right. If you are buying, you can suddenly be faced with oh that wont actually work without that you will also need contractual support …. the running costs for this model are actually a lot higher for this cheaper model….

Whatever level in the chain(product or services) you are, the decision making process in reaching a selling price is very similar. How much does it cost me? How much does it cost me to sell it? What margin would I like to make and what is achievable ? The first two processes are fairly straight forward . The Third is where the real complexities lie.

I am no longer surprised when a retailer says to me

They walk into my shop , look around ask for the price, then go onto their phone and walk out saying ….Thanks I will go home and think about it…That means they immediately buy it on the internet….I am fed up being a shop window for the Internet

What they don’t do is engage. They dont enter into a conversation like asking what price have you seen ? Is there a half way compromise ? Can we offer an additonal complementary product ? By not engaging and seeking a compromise you have not only lost a sale but more importantly you will have lost customer for ever. Your compromise which would undoubtedly mean a loss in margin, by not achieving the right price but you have retained a customer who has achieved their right price and will probably come back again. If they don’t, you will have at least made some contribution to your overheads and put cash through the till.

Simple Customer Engagement Diagram (author – Simple Me)

When buying , I think the process is altogether more complex. Most of your thought process will be about quantifying the value of the product or service to your needs . These are some of the many possible considerations….

Even though this price is more than I wanted to pay , I cannot get it elsewhere and I need it now

This supplier is charging more but they provide a much better service

Can I be sure this lower price is exactly the same item

There is not the time to seek other prices

Whether buying or selling, I think the only indication for the price being right is…

Does the sale/purchase of this product/service meet my current values and expectations ?

If the answer is a clear Yes, then perhaps the Price is Right..(for you,at this moment in time)

Or alternatively find a partner for life with the name Price.

The Question is not ‘Will Retail Change?’….The Question is ‘How will it Change ?’

A new Fashion concept store in China

Crystal Balls….the next panic buy .Toilet rolls, Pasta then Crystal Balls. Our fellow Europeans must be somewhat perplexed when reading that the first food us Brits, who elected to leave the EU , decided to stuff our cupboards with, was pasta. What’s that all about? What happened to Chicken Tikka Masala, Roast Beef and fish and chips. Since when have we become a nation that relies upon pasta to keep us going ?

None of us knows what retail will look like PC(post covid). However, there are some certainties (as much as there ever can be ) in some of the changes that are inevitable

Department Stores

Why talk about this type of retailer? Unfortunately these have been on the decline for at least three years. Because for a long time they have been the cornestones of major shopping and town centres. Both Debenhams and the House of Fraser are financially on the brink. The latter is , of course, part of the Sports Direct Empire, but I can’t see them hanging onto them for long unless there are some major changes. John Lewis has already announced they will close some stores. None of this is news nor is it constrained to the UK (Nieman Marcus the oldest department store group in the USA has just filed Chapter 11). They are losing their USP, and they are also loosing many of the concesssion brands they all use to fill the stores. Warehouse and Oasis, Cath Kidson and Laura Ashley in the UK , J.Crew in the US (inc 500 stores), to name but a few, are the latest.

Major Shopping Centres

The likes of Westfield, Hammerson,Intu and others are facing the perfect storm (always find that slightly contradictory, perfect for who?). Huge downward pressure on rents, multiple retail failures, and now the complete closure due toCovid. It is likely they will not be allowed to open for some time owing to the large number of visitors they attract, and going forward I can see many consumers avoiding them quite literally like the plague. To survive in the long term, they really need to find their Mojo. They will have to reinvent or die.

Independant High Street Retailer

During the crisis, unfortunately the shopping that has occured has been online (apart from food,where independents in the main have done well) . Consequently more consumers have got used to going online. However, the consumer has missed going to a ‘shop’. But that feeling wont last long. For those retailers that went into lockdown in a reasonably healthy position there will be the opportunity to regrow and take advantage of the weaknesses left by failing multiples . But that will need innovation, creativity and the development of their own web presence. Those retailers that were struggling , will continue to struggle if they survive at all. Even within my own industry (party) there have been casualties who have closed down already. There will, undoubtedly, be more.

Online

I know that a number of online operations who have been active from the beginning have had a great time. Stretched and stressed because they were working with a much reduced work force but successful nevertheless. For right or wrong , depending where you sit, their futures, especially in the short to medium term, look bright. They have been ably served by Amazon, in that Amazon were focusing on the essentials market for the first few weeks, and were for a time longer there as a competitor. On the other side of the coin , those Amazon resellers that only sold on Amazon, were scuppered. Ebay, on the other hand , I suspect, enjoyed a resurgence, that may or may not continue depending upon the consumer’s experience.

The Consumer

The biggest unkown in all this. How will they behave ? Whilst a lot of High Street retailers will wish their shop manners will improve, they maybe whistling in the wind. As to how they will spend their disposable income, is a far more serious question and a really difficult condundrum. Those still in a job, will probably have temporary additional spending power as it is likely they have been spending little whilst locked away. There is a strong possibility that they may rethink about how they spend their money. I have not bought this for some time, I have not missed it, do I need it? The response will probably be one of the most important factors for the Retailer in modern consumer behavioural activity. Those who will have lost their jobs will not be spending.

The only defintive is that there will be change. And it will be pretty major. What that change will be take some time even when ‘normality’ is resumed. The only action that can be taken in the immediate future , is looking at one’s own operation, look at the changes you think it needs, then be very aware of what is happening around you and adapt to meet those changes. So very easy to say……Just dont think that things will go back to normal.

It’s not all about Profit…..

The origin of the word ‘Profit’ is from the Latin word profectus meaning to advance, progress,increase. If it were to mean that and that alone it would probably be not such a contentious term. However, it does not mean just that , it is the main driver that underpins the markets within capitalism. Until now perhaps ?

this cruel pandemic is showing us much about what really matters …..This crisis has helped make clear that the world in which the sole objective of a company’s purpose is to maximise profit is no longer acceptable

This a quote from Bernard Looney, Chief Executive of BP , taken from his linkedin blog and reported in The Times April 6th 2020.

I am not against people making buckets loads of dosh. I am against those making tanks full of dosh. I dont understand why and I dont understand how anyone benefits apart from the individuals concerned . Then I dont understand what they benefit they derive from the vast wealth except knowing they have vast wealth. I think the likes of the Bill Gates Foundation is laudable but how is a point reached where one man is able to setup a charity involving billions of dollars , without having any material effect on on his own lifestyle. What if during his presence at Microsoft , he had slightly reduced profit margins and paid his colleagues more (I know they are reasonably well paid anyway ) , what if he had made his products slightly cheaper so they were more available to a wider audience . I am not picking on Bill Gates, it is justthat he is, probably, the best known amongst the current crop. Warren Buffet, an associate of Bill Gates, in his philanthropy, made a fortune out the fincial crisis alone. How does that stack up? Nor is it confined to todays billionaires, history is littered with fabulously wealthy individuals who funded amazing projects but still pocketed excessive amounts, at the same time as employing very dubious commercial practices. Carnegie, Randolph Hearst, and JP Morgan to name but a few.

Hans-Christoph Hirt of funds giant Federated Hermes wrote to businesses last week, saying: “The world will not be the same again — or, at least, it should not be.”

Hirt talks of a “more sustainable form of capitalism”, while Deloitte’s team refer to “stakeholder capitalism”. Shareholder returns may take a back seat, although Alex Edmans, professor of finance at London Business School, reckons companies that serve wider society can perform better.

Jill Treanor

Sunday April 19 2020, 12.01am, The Sunday Times

I think Bernard Looney is being relatively honest about his approach . Although, some may think he is trying to Big up BP’s environmental and social credentials . It has had its fair share of disasters in recent years. But so have all the fossil fuel companies. If he follows up the words with actions, I am pretty sure it will pay dividends , in all senses of the word.

Good profitable organizations are fundamental to all economies. They feed our pension funds (private and public) they create employment , they enhance their national treasuries (some more than others) and they create general wealth. It is that vastly excessive wealth, that does not actually do anything apart from making a few people , fabulously wealthy and in most cases powerful.

To illustrate that, this time last year, Oxfam told us that eight individuals have as much wealth as the poorest half of the world’s population. Now it has revised that figure to 61 people for last year, falling to 42 people this year – that’s a pretty big revision.

Anthony Reuben, BBC Reality Check January 2018

Many commentators and journalists , say this approach is down to envy. I would counter that with vanity. Much (I hasten to add not all) philanthropy contains a large lump of vanity. When it comes to envy , I can very clearly state from my own point of view , that this is really not the case. Under no circumstances do I ever want to be in a position that I and my family are surrounded by security. We can not go about freely. We cannot truly trust anyone. We have to be wary of every move we make or things we say and to whom. We have so much property that most of it rarely gets used. We have cars, boats and planes that are only used to be kept in working order. But perhaps most importantly completely distanced from everyday life. An apartment in town, a country pad , somewhere warm to go to in the winter , flying first class ,would all be very nice. But you dont need billions for any of that. Just a few hundred million !

My belief is that if the significant few (individuals), and as a consequence the significant many (organisations) were to rearrange their business models to be slightly less focused on pure profit and added some dollops of social, environmental and corporate awareness they would benefit financially from more investors, of all shapes and sizes, and better performance within their own markets through increased global consumer acceptance of their product and services. And just maybe the world would then be a marginally better place.

Economic Growth = A Cow’s Fart….

I think that when I was a ‘Wee Lad‘ science lessons had involved the measuring the amount of methane that shot out of a cow’s arse , I might have taken a lot more notice. But sadly it did not , so I didn’t .

My interest in cattle ( and science) waned completely, apart from avoiding them when walking in fields or peering through a butchers window .My renewed interest, having no connection to Covid, the Environment or Veganism but the Economy.

In a book ‘Get Ahead…in Physics’, the science editor Tom Whipple of the Times described an experiment involving the measurement of methane. Very simply the scientists measured what went in- so to speak and what came out. This included their poo, their urine, the methane and everything else at the bottom of the enclosure including dandruff (bet you didn’t know that). initially they weighed everything that went into the enclosure, including the calf, and the oxygen , and then weighed absolutely everything after the process. Hey presto …. there was no change in the totals. In this case before=52.5kg, after=52.5kg (including dandruff don’t forget). This is the Law of Conservation of Mass, which applies to everything .

This is not the first time I have drawn upon the efforts of our beloved cattle to bisect our economic climate . Last time I used cow’s farts to analyse pricing . Now I am using farting to discuss growth. Growth, I believe is as relevant to the Law of Conservation of Mass, as is Everything.

In the current climate , I get somewhat that economists bleat on about predicting negative growth levels in every economy . You don’t have to be a financial wizard to realise that if a good chunk of any economy is put on ice for at least six weeks, it will account for at least a minimum decline of 6% (working on a very generous assumption it is only 50% of the total economy, and six weeks = 11% of a year). No matter what happens in the following weeks a 6% gap is not going to be made up. So, PC(Post Covid) growth is going to be critical to ensure that all economies at least get back to base and beyond, in order to repair the financial damage. However BC(before Covid) I did not and still do not see how growth can continue ad infinitum.

We are a planet of finite resources . Ever since, well at least, the bronze age mankind began its consumption of the worlds resources. Overtime, technological developments have used additional resources generally with huge benefits for most us . The Malthusian Theory that population growth would outpace that the means of subsistence, has been proved wrong , or at least for the moment. There has to be a limit somewhere. Does, Zero growth world wide = The limit to which we can support the population at that time ?

Technology will continue to have major impacts upon growth. Historically, some of the simplest forms of technology have had the biggest impact on world growth. In the 1950’s the humble container is said to have been one biggest influences on the huge growth that occurred in the three decades post the war. The technology was not especially advanced it was more a simple solution pushing back on traditional labour practices which in many cases held strangle holds on the worlds docks. It is argued by some economists that the influence was greater or equal to the that of the development of the internet . If that is the case it would also be true that the development of containerisation took less resources than the development of the internet as it stands today.

Environmentalists are constantly telling us we have limited resources . It is not an environmental issue . Or rather, it is but that doesn’t win every argument. What we should agree on , is that the redistribution of wealth should one of the considerations when pursing endless growth when at some point it becomes unachievable. This is not an anti-capitalist viewpoint. From my point of view one of the biggest problems with capitalism is that the markets are constantly seeking growth.

I see it that it is no coincidence that during China’s massive growth over the last twenty years, the rest of the first worlds growth has been less dramatic. There is an historical context . Up until the 1500’s the wealth and power was in Asia, then it tipped over to Europe ,now it is going back. There are few periods when there has been anything close to a balanced scenario.

It is not something we should pursuing in the short term, nor the medium term but in the long term we must consider alternatives ways of operating successful economic systems without the relentless pursuit of growth . Simplistic perhaps, realistic I think so .

If our eyes and ears (and noses) are telling us there is too much cow farting going on, we should, perhaps , desist on trying to see who can blow the biggest raspberries.

Composting, Compounding,Composing or just plain Confusing?

I get it. I really do. I get Climate Change . I get that there are very serious environmental consequences relating to excessive consumerism, polluting detritus, rapid increase in urbanisation, (or rapid increase in land given over to agriculture) or (and even, as well as ) natural climate change .

What I don’t quite get, is the understanding of what really needs to be done. Let me qualify that . There is a mass of data and general information but there appears little acceptance of the consequences of not approaching that data with a more rational and holistic approach. If we are consistently bombarded with worst case scenarios and hair shirt resolutions, I firmly believe the general public will eventually switch off and say it won’t happen to me…..

I won’t drone on about electric cars, and the impact upon the environment on producing millions and millions of batteries. I won’t drone on about the lack of infrastructure. Nor will I speculate on how that change in infrastructure will impact upon the environment. Further more I won’t comment at length about a recent report suggesting that are times when when recharging your electric car cost as much as filling it with petrol. But I will talk about ‘bin bags’. Simple example. Most bin bags available in supermarkets and dramatically thinner, some compostable (come back to this). Avoiding cynicism (thinner bags) assuming they are like this to reduce plastic waste. My experience is that , we actually use twice the amount as if you put anything remotely heavy , slightly sharp or has an edge means they split and you end up using twice as much.

Plastic ,now that’s a material about which there is a massive misunderstanding. Based on a general assumption that everything a bit squidgy or stretchy is plastic. But that’s for another day . Many conversations with retailers at a recent trade exhibition illustrated some of the confused issues we are all faced with.

Nope my customers tell me they won’t buy plastic toys….they want wooden toys…

Admirable thought but how realistic is that intention. The end game for that train of thought has to be the global elimination of the manufacture of plastic toys. No big deal , plastic toys are hardly one of the corner stones of life as we know it. So you replace them with wooden toys. Well, for starters I am unconvinced that you can replace them in total with wood from sustainable forests. Moreover, it puts further pressure (created by all the future demands on wood) on sustainable forestry resources. It has social implications. Plastic is cheaper , compared to wood. Privileged kids have their toys, less privilged don’t. the question cannot arise of Can I afford to be environmentally aware ? Composting, do most know what it really means ? Do they compost ? Or do they stick it in recycling thinking it’s the same thing? No most don’t know. Not only don’t they completely misunderstand the concept ‘To Compost’. As many items that are compostable are not recyclable .

Mixed messages….lots of objections to HS2. Quite justified on financial grounds but when some of this objections are environmental it is much less clear. Do we want big reductions in air and road usage or not? It would make a lot more sense to extend it from London to Glasgow. Would it not?

Compounding….

You’d think the more ‘info’ we get the better it is. But we are literally we are under an information deluge, bit like the current rainfall. There is so much of it we don’t know what to do with it. It only compounds and exacerbates the confusion.

Confusing….

Diesel good …. very rapidly became diesel bad ….

Britain’s Power system has been decarbonising at a faster rate than any where else in the world .

Emissions have fallen buy over two thirds in the last decade. From 160 million tonnes in 2010 to 54 million in 2019

In the electricity sector, a decrease in demand for power proved to be the biggest driver of the decline in emissions, according to the report by academics from Imperial College London for Drax Electric Insights.

Demand fell by 13 per cent, even as the population grew by seven per cent and GDP rose by a quarter, as measures such as more energy efficient lighting, manufacturing and other efficiency measures took hold.

However the rise of electric vehicles and household heat pumps threaten to reverse this trend, the report warned.

Independent Feb 2020

This is a massive problem that needs massive answers. But those (no I haven’t a clue) answers need joined up thinking, and those joins need to cross boundaries. Moreover, the answers we are being given, lead to even more questions. The fear has to be that if the public is only given solutions that they don’t understand, find very confusing, and above all too extreme they will eventually pull the blinds down and say they are not going to play anymore .

No passion so effectually robs the mind of all its powers of acting and reasoning as fear.

Edmund Burke

I would add that I wrote this before the present Corona crisis. Everything that is above remains the same . What may have changed, in whatever direction that maybe, is societies approach.