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‘With less business, retailers should reformulate cost structure, focus on increasing savings’

BS Nagesh, Founder, TRRAIN
BS Nagesh“We are not sitting at home with the intention of closing our business. We will all reopen our businesses. So, the first attitude is, we are going back to our business and will take it to the next level. Secondly, we will have to analyze our previous work and behaviour with customers in the last 5 to 10 years, if our attitude was that of ‘you are just a customer’ and ‘I don’t care’ previously then be assured your customer will never come back. The people or brands who have already created trust with customers will be the early winners according to me. At this time, those who are in competition need to introspect their future dealings and elements related to it. To create this trust today, no one has a magic wand because we are unaware of customer’s demand, choice and when they come in, we will not work on our KPI’s because we don’t know what the customer wants. It is all guess work.”

Comparing the current retail environment to a test match for retailers, B S Nagesh, Founder, TRRAIN urged retailers to create a win-win situation for customers. Speaking at the recent #2 webinar organized by DFU Publications-DFU LIVE in association with TRRAIN on the theme: ‘Consumer Bulao, Retailer Jitao’ (Spiking Consumption, Winning the Customer Back) he said, “In the next 15 days, the values of hygiene and safety will become an integral part of our lives as customers will begin to differentiate between retailers according to their adherence to these two.”

Nagesh explained, the next nine months will be tough for retailers, irrespective of the numerous festivals that will come during this period. Therefore, retailers need to be positive and do their best to survive the next six to nine months. “We have to not only take our business to the next level but also revaluate our behavior with customers over the past 10-15 years,” he added. Nagesh also advises brands to create trust in the minds of their customers. “For this, it is important that we empower our employees so that we don’t miss even a single customer in this competitive market.”

Focus on cost saving

Just like brands expect customers to be loyal to be them, brands also have to be loyal to their customers in future. “This process of loyalty-building with customers should be a continuous and ongoing process. For example, if a customer is confused about the sizes of garments but is reluctant to go for trial, store managers should allows these customers to take both garments home at an additional monetary deposit and return the other piece in sometime,” he added.

Like online portals, offline retailers should work 24X7. “The lockdown period offers retailers the opportunity to talk to their employees on a regular basis to take the business ahead by upskilling business heads on behavioral tactics,” added Nagesh. Business is likely to be less during this period as malls will operate for only 8 to 12 hours a day which will lead to one-third decline in business. Maintaining social distancing will take away about 30 to 50 per cent of the business. This will impact demand and supply of end to end services. “In such a situation, retailers should reformulate their cost structure and focus on increasing their savings. Since sales are likely to be reduced by 25 per cent they should be able to sustain their business with the remaining 75 per cent revenues besides paying 100 per cent rents, salaries etc,” he stated further.

Be adaptive to customer needs

The next important advice Nagesh offers to retailers is to multitask.”We will have to work with less number of employees and multitask,” he said. Today, customers in the age group of 25 to 45 years are more connected to nature and environment. They are responsible customers and expect us to be responsible retailers. These customers will curtail their expenditure in future and would prefer to shop from retailers who understand their needs and support them. “Similarly, customers in the age group of 45 to 60 years will refrain from spending due to increasing pressures from governments, families, etc. To deal with both types of customers, retailers will have to adapt their business attitudes accordingly,” Nagesh summed up.

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