The retail world is becoming increasingly competitive as companies fight for consumers' money through a variety of channels. Online shopping has completely changed the way the world operates, as people can now do their shopping from the comfort of a chair in their family room, or at a coffee shop on their lunch break. Desktop purchases are still significantly higher than those with hand held devices, but the gap is closing.
Shopping habits continue to change
Since 2000, fully three-quarters of retail sales growth has occurred through online channels. That’s an eye-catching statistic, yet not quite the whole story. The online channel now accounts for about 8 percent of total retail sales. Managing multiple retail stores is becoming increasingly difficult, but Royal Services are here to help by providing total facility management solutions.
But three sectors have been largely untouched by e-commerce: cars, gasoline stations, and groceries. Because these categories are significant, responsible for almost half of total retail sales, online’s penetration of its “addressable market” — in other words, its available pool of revenue — is close to 16 percent. And it is expanding rapidly, at an annual pace of about 15 percent, well beyond the traditional retail, “GDP-like” growth rate. (Kestello & Hodson, 2016).
A portfolio of flagship stores
With this increase in competition, we have seen a trend in recent years of retailers focusing on quality rather than quantity. Many retailers, such as Soft Surroundings, have a limited number of stores (approximately 60 and still growing), but have flagship stores in key markets. These are designed to draw customers in and sell them on the brand. The consumer can then shop in the store, or can go home and search for deals to get the items at a discounted price online. Challenges involved with keeping stores current
These flagship stores need to look immaculate, and need to stay with the times, hence an increase in remodels and refresh projects experienced throughout the industry.
Whether it’s a minor remodels throughout your network, or just a refresh at a handful of stores, retailers have a variety of options — and decisions to make — when it comes to updating their store interiors. We spoke to members of the Royal Services special projects team about store update programs. store update programs. What are some of the most common mistakes retailers make when undertaking a refresh, remodel or rebranding program?
The primary mistake retailers make is not having a clearly defined scope of work, which often leads to misunderstandings, complications and a prolonged time line. This can also lead to more disruption within the store, a drop in revenue, and increased expenses, all of which are things that we are trying to avoid when possible. Another mistake is not getting the site surveyed or using old survey data that is incorrect.
Technologies such as 3D data surveys from Immersion Data Solutions featured above, have helped tremendously with conducting site surveys before and after work has been done.
Lastly, not having the store manager on-board to the scope of work corporate has identified. If crews survey the site in the quoting process, there is an opportunity to engage with the store manager prior to the start of the project to set expectations, as well as address concerns outside the SOW. What is the optimum time that should elapse between refresh or remodels?
Retailers should plan on refreshing high-traffic areas every three years, before visitors notice the environment looking shabby. And they should plan on remodeling their locations every five to seven years. Some retailers, especially those involved with technologies, will typically experience several rollout projects each year through such things as fixture installations, kiosk relocations, and display case installation. Many retailers have managed to reduce their costs in this direction by placing responsibility for the work on the OEMs. This keeps the store looking fresh and current, but without any additional cost. Ideally, retailers should look to remodel when leases renew and retailers can get landlord participation, or when the brand imaging changes. Are you seeing an increase in remodels and refresh projects these days?
Yes, we have seen steadily increasing activity for the last 24 months. Many of our clients are investing in making their stores look clean and modern to give them a strong presence in the brick and mortar world. They are also trying to stay on the cutting edge of technology so as to provide the best in-store experience possible. This is typically combined with an equally strong and consistent online presence, to ensure all demographics and personas are being catered to.
Do most stores stay open during the process?
Yes, we are almost always able to keep the stores open, as the majority of our work is done after hours. For this to occur it is crucial for their to be impeccable planning and communication procedures in place to ensure time lines are met, and to minimize store disruption. We have remote project managers around the country who oversee the night shifts, and make sure that things are ready to go when the employees turn up for work the following day. On larger projects where there is a larger scope of work, we might have to close the store for one day, but these incidences are infrequent. What solutions do Royal Services offer retailers?
Royal Services manage multi-site refresh programs, requiring painting, flooring, graphics, decor and general repair services across the United States, Canada, USVI and Puerto Rico. We work with some of the largest national retail, healthcare, services and fitness brands, as well as their facility maintenance managers.
We are multi-site rollout experts and some of our past projects can be viewed HERE. We have been performing rollouts since 1993, and are experts in this area. We have found our niche within the rollout realm and try to spend as much time as possible there. A huge reason for this is RAZOR, our proprietary CMMS, which acts as one point of contact, providing everyone involved with visibility to project progress. This has really allowed us to take things to the next level, and has generated a lot of excellent feedback from our clients. All of our teams are also provided with tablets in the field, so that they can load live photos to the cloud that allow our project managers, and your staff to monitor up to the minute progress with each site across the network. How do you work with retailers to stay open during a refresh/remodel/rollout project?
We typically work through the night, cleaning up daily so that the store can operate during business hours. We will work with clients to develop a phasing plan to the store so they can properly allocate the necessary store employees each night to de-merchandise. Our crews are well-versed in retail work and know how to keep a store clean so merchandise can be put back in place quickly to get the store open on time each day.
When we are asked to work during retail hours, we stage the work to minimize the impact to the environment and customers, as well as block off the area as designated by our clients. How does Royal handle multi-site rollouts?
Exceptionally well! We have a staff that specializes in refresh project and program rollouts, offering a single point of contact with trades and accounting. Multi-site rollouts require a significant amount of design consultation, scope of work creation, pre-planning, including coordination of schedules, vetting and approval of vendors, and collection of permits(if required). Royal Services partner with our clients to ensure understanding of scope of work, articulating it to teams and crews to ensure a successful launch, as well as any revisions along the way.
As we finalize jobs, we ensure there is a back-end process in place to gather the necessary documentation from the field to close down jobs with both the customer and the accounting systems so that clients receive timely invoices, with minimum effort.
In addition, we give portability to best practice methods to multi-location scopes of work. All of our vendors and self performing crews have been vetted and trained to handle the unique issues of rollout initiatives efficiently and in the most cost-effective way.
Contact us today for an initial consultation about how our approach to rollouts, refreshes, and remodels could benefit you. We are happy to discuss your project early in its creation so that we can save you time, effort and money in the long run. Contact Kathy David today at kdavid@royalsolves.com or 913-387-2841.
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