Close this search box.

EDITORIAL Balancing multichannel: how retailers handle store numbers when more shoppers buy online

At first glance, The Entertainer and Thomas Cook would seem to be on a very different page as regards the importance of stores in multichannel retail. But when almost two-thirds of UK holidays are being bought online, Thomas Cook’s decision to close 21 stores seems a very moderate one. 

After these stores are closed the travel company will still have more than twice as many stores (566) as The Entertainer (163 plus the 80 concessions that it will have in Mothercare). It seems that the right number of shops for the UK retailer of the future may well lie somewhere between the two, although this will vary depending on the category. Fashion-to-homewares retailer Next this week projected forward 15 years to deduce that it’s likely to have around 270 stores – of which around 120 may well be loss-making. It makes sense, it says, to accept those losses as a cost of doing business in an age of connected retail when stores will act as collection points as much as somewhere to store stock. Ultimately, it judges, shoppers will be more likely to buy from the retailer that can deliver the most convenient service. After all, says Next chief executive Simon Wolfson in those figures, “No one knows what the High Street will look like in ten years, but one thing is certain: the people walking down it will be wearing clothes. And hundreds of thousands of people will be employed in the design, manufacture, distribution, marketing and fulfilment of that product.” His conclusion is that retailers “cannot decide how our customers will shop; our job is to adapt and serve them in whatever way they most want.”

Asda and Sainsbury’s, meanwhile, are also focusing on customer convenience with the plan to open Argos stores within branches of Asda  – as its owner Sainsbury’s has done – as it looks to cut costs if a merger between the two wins CMA approval. Argos stores, presumably, would close if that went ahead. 

Debenhams, in the news today as it continues to fight to survive, is also working out what will encourage its shoppers into store. In other words, it’s working out how the department store can stay relevant to shoppers in a digital age. Debenhams currently has around 165 stores in the UK but it’s likely that around 50 of those will close through its transformation plan, if the retailer survives. Even though the latest retail sales figures from the ONS suggest shoppers were willing to venture out to visit shops in an unseasonably warm February, growth remains lacklustre in the department store sector. How department stores can stay relevant is an active discussion for retailers well beyond Debenhams. 

Today’s guest comment comes from Don Brenchley of Llamasoft, who ponders how retailers must now adapt to the way that younger shoppers, Generation Z, want to buy. It seems even greater change lies ahead for those retailers now considering how to transform their businesses. 

Image: Fotolia

Read More

Register for Newsletter

Group 4 Copy 3Created with Sketch.

Receive 3 newsletters per week

Group 3Created with Sketch.

Gain access to all Top500 research

Group 4Created with Sketch.

Personalise your experience on