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The New World of Growth: Reconstructing Retail’S Future

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The New World of Growth: Reconstructing Retail’S Future THE NEW WORLD OF GROWTH: RECONSTRUCTING RETAIL’S FUTURE In association with AT A GLANCE or some uber-successful retailers, annual sales growth is almost a given, even in the past few years of depressed consumer demand and against the backdrop of Brexit. CONTENTS Digital-first businesses such as Farfetch, Made.com and FThe Hut Group are among those that have been growing at pace, STEP 1 driven by an exceptional customer proposition and offering something different in an overcrowded market. After years of reliably Embracing new markets and customers delivering sales increases, this growth has been taken for granted. But the coronavirus pandemic has turned all of that on its head. STEP 2 It knocked many fast-growing retailers off course completely, in an Experimenting with new channels extraordinarily unexpected way. While some have dealt with it well, and adapted to the times, others have not. STEP 3 For several years now, RWRC has created an annual Top 30 Growth Retailers report, centred around the fastest-growing Developing new structures and models retailers in the UK. STEP 4 As in other years, this report reveals the much-anticipated Forging new partnerships ranking, based on Retail Week Prospect data, outlined in the final chapter. But in a marked departure, rather than the bulk of the report 2020 RANKING analysing retailers’ performance based on figures from 12 months ago, this year we look to the future, reflecting the extraordinary The UK’s fastest-growing retailers revealed times we are operating in. ACTION POINTS The world has moved on dramatically in the past six months and The New World of Growth, produced in partnership with The path to growth Sorted, will reveal what retailers and experts believe will be the pillars of success going forward in this uncertain environment. Thriving under pressure In light of the global pandemic, the leading retailers can no longer rely step plan to ensure their business thrives, even in the toughest of climates. on traditional avenues for growth, so what does a future-proofed sales From exploring new channels, product lines and markets to delving into strategy look like in a world where unexpected crises such as pandemics new partnerships and customer demographics, everything is up for grabs could be right around the corner? for retailers looking to move forward following the 2020 crisis. With This year’s RWRC report examines what a winning growth strategy insights from retailers, brands and industry commentators, the following might look like in these uncertain times. It will provide retailers with a four- chapters assess the route to growth for the sector in extraordinary times. RWRC: THE NEW WORLD OF GROWTH Head of Commercial Content Contributors Helen Berry, Rebecca Dyer, Nicola Harrison 020 3033 2837 Ben Sillitoe, Chris Young [email protected] Business Development Director Commercial Production Editor Tom Jones 020 7715 6533 Stephen Eddie 020 7715 6015 [email protected] [email protected] 2 | October 2020 In association with PARTNER VIEWPOINT DAVID GRIMES FOUNDER AND CHIEF EXECUTIVE, SORTED GROUP he retail sector has always been The insight and action plan in this report at the forefront of change, the is a solid start to navigating what lies ahead, curators of consumer trends and and the key takeaway is definitely the By harnessing the trailblazers of technology, importance of collaboration. By harnessing Tpioneering the implementation of new tech the power of partnership, we make sure our the power of on a mass scale. We’ve known for a long businesses, people and systems are set up time that retail is probably one of the most for the future. – if not the most – resilient and innovative So, although retail has a whole host of partnership, industries on the planet. new risks to deal with, there is, thankfully, This year has been a bit of a shock. To say a world of reward for those who are decisive, we make sure the least. agile and proactive. We’ve thrown out the roadmaps, wiped We’ve probably resigned ourselves to the clean the drawing board and ripped up the fact that we’re never again going to know our businesses project plans. It’s been a test like no other what’s over the horizon – at least not with and continues to be an extremely challenging any certainty. are set up for operating environment for everyone. Now, we’re recognising that success isn’t That said, there have been some about planning and predicting for years the future impressive responses to the change we’ve ahead, but about being ready to pivot and seen in the last 12 months – as we can see stay steady on the uneven path to the new in this report. New collaborations between world of growth. retailers, new tech partnerships, new acquisitions, never-before-seen retail models and cultural shifts, facilitated by retailers but led by the customers they serve. This year’s retail growth ranking shows that there are exciting moves happening, with 12 new entrants making the list in 2020. SORTED Sorted is refreshingly agile and data-driven delivery sofware – powering dynamic checkouts, delivery management and delivery tracking around the world. The sofware is now live in 17 countries with brands such as Asos, Asda, French Connection, Mountain Warehouse, Mulberry, Missguided and Lush. Sorted Group, Third Floor, The Union, Albert Square, Manchester, M2 6LW sorted.com 0330 0555 284 [email protected] @SortedOcial facebook.com/SortedOcial/ linkedin.com/company/sorted-ocial October 2020 | 3 here are three ways a leadership team can choose to grow their business, according to Cheryl Calverley, CEO of Eve Sleep, a Tdirect-to-consumer (D2C) mattress and sleep products brand. “You can sell new products to the same people, you can find new people, or locate different places to sell it,” she explains, neatly illustrating the fundamental ways retailers have sought growth for many years. But in a world turned upside down by the digital revolution, the ongoing debate around Brexit’s impact on the industry and now the aftermath of a global health emergency, this tried-and-tested growth theory is now more nuanced and complex. Department store chain John Lewis, for example, detailed several ways it may move forward as an organisation following recent structural change and a downturn in performance, including launching a rental service in furniture lines. Brands such as Ralph Lauren and Yoox Net-a-Porter, meanwhile, are investing in the concept of digital fashion, creating apparel items only for a digital avatar, which analysts suggest could be the start of a journey towards the commercialisation of non-physical products – potentially for usage in gaming and/or social media. With retailers entering the rental market and brands exploring what until recently were unthinkable new sales channels, the road to growth in the 21st century is arguably not as obvious as in previous years. For Calverley, though, Eve, which despite experiencing a tumultuous period since its float ranks at number 13 in our fastest-growing retailers of the last year, is “staying firmly in things we can make – physical products”. She paints a picture of a sensible risk-managed exploration of growth opportunities, which might entail new international markets if the right locations emerge. But the brand will take a cautious approach after scaling back its overseas arm in recent years to drive costs down. “We’re doing more things in satellite markets [outside its core UK and France heartlands],” she explains. “We’ll follow the data and follow the money, and follow what we as a business find easiest to deliver a great customer experience in. That’s the most important thing for the growth of a small business – customers tell other customers.” 4 | October 2020 In association with STEP 1: EMBRACING NEW MARKETS AND CUSTOMERS October 2020 | 5 New product, new territories However, more long-term thinking in terms big enough in its own right to talk about as Be it through marketplace partnerships of new product development and category a separate channel.” taking them into new territories without the management will be the key to prolonged and The rise to prominence of premium need for huge infrastructure investment, or sustainable growth for retailers. beauty is also a long-running trend. by going it alone a la Poundland’s Dealz fascia Home-based products, including Traditional retailers from Boots to Next, in Poland and Primark in Europe and the US, electricals and accessories, have fared well and from John Lewis to Sainsbury’s, have plenty of UK retailers are growing abroad. during the pandemic. Hotel Chocolat, a new all upped the ante in beauty. Next is backing With Brexit as well, and the uncertainty entry at 28 in this year’s ranking, is one the category with its acquisition of Fabled that comes with it, some retailers are hedging retailer hoping to take advantage. and a planned network of UK beauty halls. their bets and ensuring they have one arm The confectionery retailer’s recent launch Related to beauty is the wellness product in the UK and one in the European Union, of its in-home hot chocolate machine, The movement. With more consumers looking ensuring stock sits in both territories or Velvetiser, has come at an optimal time, and for self-care items, Primark launched its own bonded warehouses to avoid any future levies. highlights how product development is a wellness range in 2020, including workout And if new territories are not on the way to grow the customer base. gear and scented candles. The retailer agenda, then fresh product ranges are always Chief executive and founder Angus underpinned the move with an ethical an option for pushing for growth.
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