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Apple Store. “If you go into an Apple
store, it’s beautifully merchandised, very
well laid out; there are plenty of staff, all
very knowledgeable and you can always
get help and assistance. It’s a great
environment because all the products
are working; you can demo them; you
can try them. It’s a nice in-store shopping
experience. Our merchandising team works
with the retailer to create an experience as
close to that as we possibly can,” he said.
The last 50 feet
A key part of improving the shopping
experience is ensuring that the product is
on the shelf and not stuck in a back room.
Oxley calls this ‘the last 50 feet’ and says
that in retail on-shelf product availability
is often only 90%, not because it is not in
stock, but simply because it has not made
it onto the shop floor. That, he says, results
in about £4 billion in lost sales every year.
To help retailers improve their sales,
Westcoast Retail has a number of funded
heads or implants – Westcoast employees
who work for a particular retailer and liaise
with Westcoast Retail on forecasting and
stock replenishment to ensure the right
stock goes to the right stores at the right
time.
“Sometimes stores have different
systems that may not talk together
properly or may not have the right
communication with the promotional team,
so you could end up with stock going
to the wrong stores, which would mean
there’s not enough to replenish the better
selling stores. We work collaboratively
to make sure we get the right amount
of stock to the stores that have the best
chance of selling it,” he said.
Gaining control of stock distribution
brings a number of additional benefits to
retailers. For example, if Westcoast Retail
can reduce the amount of stock in the
supply chain, without affecting inventory, it
could help a retailer’s working capital and
cash flow position.
“It’s about working with retailers to
understand their order frequency from us,
to understand what they are doing, why
they are doing it and how they are doing
it and seeing if we can help them improve
that cycle,” explained Oxley.
“Rather than ordering a large quantity,
then ordering nothing, then a large
quantity, then nothing, which can also put
Consumer demand is soft, and that leads to pockets of inventory. You have to order the next
range of stock before you’ve even sold this one, or know how it’s going to sell
pressure on their own resources, e.g. the
amount of trucks they would need to book
it into their DC, collect it and then ship it
out, we create a better equilibrium. Instead
of spikes in the order process, retailers end
up with better availability on-shelf, in-store,
which leads to an automatic increase in
the rate of sale.”
Stock counts
Oxley adds that the management of stock
levels can also be improved through store
visits and stock counts by Westcoast
Retail’s merchandising team.
“One of the issues any retailer may
face is what we call ghost stock. If the
system says you’ve got five units, but
you’ve sold none and you truly are out of
stock you’ll never get your stock replaced,
because the system says you’ve still got
some. These differences can occur if items
are stolen, misbooked or just miscounted.
By zeroing the system or bringing it back to
the true stock position, it will automatically
replenish and give you a chance to sell
your product,” he said.
Maximising sales opportunities and
removing unnecessary expense is essential
at a time of rising prices caused by the
weak pound, which has seen a laptop that
used to cost £329 rise in price to £379.
“Consumer demand is soft, and that
leads to pockets of inventory. You have
to order the next range of stock before
you’ve even sold this one, or know how it’s
going to sell. Getting that balance right
between what we believe the new forecast
might be for Q3, when Q2 is soft and you
still have Q2 volumes to go through, is
one of the greatest short-term challenges
facing manufacturers and retailers,” Oxley
explained.
New growth areas
One way to counter weak demand is to
target high growth areas. Traditionally,
Westcoast Retail has gone ‘narrow and
deep’ with its favoured brands, supplying
the cheapest HP mouse and the most
expensive HP server and everything in
between. Moving forward, there is a clear
strategy to expand into new product
categories and product areas.
“One exciting new area is the Internet
of Things, something like an Alexa, which
now becomes a usable hub. There’s
speculation that Apple will be bringing out
its own version as well. People who are
in the Apple ecosystem of products know
that when you get the product out of the
box and turn it on it works, so that product,
if the rumours are right, could be quite
successful.
“This is an exciting area, but what does
automation in the home actually mean
and what will most people be prepared to
adopt? Will home automation extend to
the doorbell? Will people buy an iKettle?
Or light bulbs that change colour by
remote? Out of all the home automation
that potentially could come, how much
are people really going to use to automate
their home? A big unknown today is how
big this market could be in the future.”
Arguably, this uncertainty and
unpredictability is all the more reason why
a retailer might want to take advantage
of the value add that Westcoast Retail
can provide. Not only to make the buying
experience as simple and straightforward
as possible for the consumer, but also to
ensure that the retailer has products on
the shelf and in its stores where demand
is highest.
