Friday, November 26, 2010

Ownership of the Customer starts with ownership of the store

During a series of recent training programs for Retail Operations people, I was highlighting the importance of taking ownership of the store and hence the customer. In that context the standard question to the audience would be how many of you take ownership of the store and hence the customers.
Predictably almost everyone’s hand would go up. Great; everyone is taking ownership of the store and hence the customer.
End of the story? Hardly, it is the beginning.
The next question would relate to old, slow moving or dead stocks. Regardless of the format the fact of the matter is that any store has a certain percentage of stocks which are non-moving. These are dead investments and only block up the working capital.
So, next I would ask how many have such stocks in their respective stores. Be it 1% or 5% or 10%, etc. There would be an enthusiastic response that, yes there are such stocks.
Now my next question; If this was your OWN store and your working capital was tied up would you allow this to happen or would you return the stocks or sell it off at a discount and clear the same.
At this point, the crux of the ownership issue will come out.
  • I don’t have approval from HO to do this. If it was my own store, I don’t need that.
  • I informed the merchandising team and they have done nothing.
So on and so forth.
Beneath these excuses lies a sad story of helplessness. Under the pretext of control and standardization the Corporate Retail of India today has depowered the store. But, on the other hand they are told that they are the face of the Retailer and they need to own the store and customer. What a dichotomy!
Having said that, I am also aware of store managers who had the freedom to act and therefore misused it by putting products on discount to reduce stock, at prices below the cost price.
The point is that a happy medium is needed and needed soon. The operations team needs to know their boundaries of the game while the boundaries should be large enough to motivate them to take ownership of the store or customers.
Otherwise, ownership of the store and customers will increasingly become empty words spouted during meetings and training programs where participants will enthusiastically raise hands to claim ownership, enjoy some good food and then go back to status quo.


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