When I go for a jog or bike ride, I use motivational music from a dance producing duo and brothers called Disclosure and quite often start with a song called ‘Intro.’
“As much as you like to be in your comfort zone. As much as you like to be stable. As much as you like to control your environment. The reality is: everything changes”.
A recent story on the BBC reminded me of the start to this song.
Primark loosing £650 million a month in revenue.
When businesses who have a very tight business model come to a disruptive change quickly, they can’t adapt.
Imagine going from £21 million in sales revenue a day to zero with no forward strategy. Surely a responsible company that turns over £650 million a month would have a back-up plan.
I know that I wouldn’t want to be George Weston the CEO of Primark, the UK’s budget clothing retailer. They responsibly closed the doors on the 22nd March and haven’t sold anything since. Simply because they have focussed on the stores and not with an online offering. Leaving the owners Associated British Foods with a huge headache.
Without the use of the Furlough scheme a good proportion of their 68,000 staff across Europe would have been made redundant during the COVID-19 lockdown.
I’m not surprised that Primark doesn’t have an online shop, the goods simply aren’t worth enough in purchase value to warrant the hassle of handling, postage and returns. But they could have implemented a click and collect service.
The discussions around bigger companies having more resilience in these challenging times simply isn’t true. They just have everything bigger than your average SME. So, this has to start the discussion around how you can diversify and make sure you have as many aligns covered during a challenging period of trading – or you are left with the same headaches as Primark.
Even when the stores open again, the seasons have moved on. They will be left with out-of-date stock and will have to play catch-up with new stock from suppliers. Which would have been planned months in advance. The business model simply has no room for disruption.
What can we take from this situation and can we apply some of the lessons Primark are learning? I go back to the lyrics of the song.
“As much as you like to control your environment . The reality is: everything changes.”
Have you adapted during this challenging period, are you closed because of this lockdown?
On the premise that we could have future lockdowns or pandemics, what can you change to disrupt this situation and continue to trade?
