Steve Katz:
Hi everybody, and thanks for taking time out of your busy schedule to listen in on our Hilco Global Smarter Perspective Podcasts. As return listeners know by now, I'm your host, Steve Katz, and if this is your first time with us, well then welcome. We're glad you could tune in.
Steve Katz:
Today we'll be talking about how the retail industry can and is beginning to benefit from embracing new and available technologies, deploying innovative business intelligence tools and training employees to help drive successful outcomes. And with us for that conversation is first-time podcast guest Ben Chamberlain, managing director of Hilco Merchant Resources Asia Pacific, and also co-founder and CEO of ReStore for Retail. Ben, I know it's pretty early in the AM Australia time, so thanks for being such a good sport and joining us on the podcast.
Ben Chamberlain:
It's my pleasure, Steve. We're getting used to working across different time zones at the moment, so don't worry about me.
Steve Katz:
Okay, well it's great to have you on and here we go. With so much volatility in the retail market this year, whether in the APAC region, Europe, U.S., where do retailers' priorities lie right now? And importantly, are they doing what they really should be doing to get through this final quarter of the year in a way that really sets them up for success in 2023?
Ben Chamberlain:
Truthfully, Steve, retailers are right in the thick of it now. It's the final quarter, and this is where the magic happens. The decisions that they have made earlier in the year are the decisions that are going to really set them up for this quarter. So whether or not they have a successful final quarter or not is really a product of the decisions that they made earlier in the year. And it has been an incredibly difficult year in so many ways. Typically, you have a really strong baseline with your prior year to start to make decisions for your forward year. But of course, we've had this extraordinary event in the pandemic that has led to a whole variety of challenges for retailers to face into. And so whilst this year has been all about supply chain and managing labor force, next year is going to be somewhat of a consolidation year.
Ben Chamberlain:
We're really we're going to need to think about those things that have gone enormously well for us in retail, those things that continue to be headwinds and challenges and finding ways to tie them together to have as predictable a year as possible next year. And so as I think about setting up for a successful 2023, I don't necessarily think there's much more that can be done in this final quarter per se, because really the rubber has to hit the road now. Retails need to be absolutely focused on having the most successful holiday season possible. If they start to just cast their lens forward to January, January is going to be a critical month to start setting up some systems and processes and thinking about what tools are going to be necessary to help ensure that next year is as successful as possible.
Steve Katz:
Yeah, it makes a lot of sense, and it has been an unprecedented time period and you can't really just look back and say, "Okay, we set the stage, this is where we were and this is where we're going." Based on predictability, that's all out the window, like you said. So what are the type of tools that we're talking about and what issues really need to be addressed moving into the next year?
Ben Chamberlain:
Well, I think this is where it gets really exciting because the last couple of years have accelerated the growth of online e-commerce, but are greater than we ever anticipated. And what that's also done is it's accelerated our expectations around the data that we get access to make decisions. And so there's been all these interesting impacts and effects from what has been a very, very accelerated period of time for online e-commerce. One of them is what is the role of the physical stores in managing an overall retail proposition. Because as we moved into the pandemic, people were down on stores, online was taking up a bigger share of sales, there was a lot of investment going to online, and you were seeing a corresponding reduction in investment in-store networks. And so there was really a narrative around, do stores have a role to play in future retail?
Ben Chamberlain:
What we've come to learn as we've come out of the pandemic is that stores play a critical role in an overall retail proposition. They don't just serve as a place for convenience. They actually serve as a place to support online purchases, returns, click and collect, showrooms, but most importantly, a place for customers to come and experience the brand and to build that sense of connection to the brand. And so as we move into next year, what excites me is that people are thinking about the sort of benefits that they have yielded through some of the technology solutions that they put in place during the pandemic, and they're starting to think more broadly now about how they can replicate the sort of success they're having with those across other parts of their business. And so technology that we're seeing gain traction are across areas touching inventory. So how can we better understand our inventory to make smarter decisions about either buying decisions, about discounting decisions, or about allocation decisions to stores?
Steve Katz:
Yeah, for sure, Ben. I mean, the pendulum just really keeps on swinging, doesn't it? It's an omnichannel world out there right now, that's for sure. And I guess the follow-up question to that would be how can retailers deliver that seamless, efficient personal experience integrating the store and everything else? We're in a situation where everything didn't go online, everything is now... Really needs to be integrated to deliver the overall experience the right way and keep the customer engaged. How are the retail stores going to go about that in an effective way? And I know you guys are coming at it from technology, so we can head down that path.
Ben Chamberlain:
Yeah, thanks, Steve. I mean, look, ultimately there is a huge amount of investment going into helping with that omnichannel experience from a customer-facing perspective. So as a customer, you are getting the most extraordinary suite of services as a customer of a retailer. You can really get to the point now where it doesn't matter how you want to engage to purchase with a retailer, you've got every option available to you.
Ben Chamberlain:
The challenge with that is that it's putting more and more pressure on the store to deliver more efficiency, because you're asking the store associates, and indeed that physical presence of the store, to just do so much more now than has ever been asked of that store before. And what we observe is that there's an enormous amount of investment going into supporting that consumer journey. What we need to make sure that we're doing is, on the other side of that coin, is finding ways to create efficiency gains for the store associates, for those people that are having to deliver on that expanded suite of services to the customer.
Ben Chamberlain:
And so in our mind, there is a great opportunity for innovation to support store associates, to give them a chance to spend more time on the sales floor, to spend more time engaging with customers. Not just by overloading with more, and more, and more to do in relation to that customer experience.
Steve Katz:
Yeah, very, very interesting. So can you give us some examples of what that's technology is what you guys are focusing in on?
Ben Chamberlain:
You're absolutely right, Steve. We are taking this from a technology perspective. In our estimation, we have a long way to go before we've really unlocked the potential to use technology to aid and support retail store associates, and indeed management, in their everyday life. For us, the goal is how do we help retailers. In fact, everyone within that retail vertical to be as successful as they possibly can each day. So each part of that retail vertical has a different lever that we need to be thinking about pulling.
Ben Chamberlain:
So if I think about the store associates, those people that are on the floor, on the sales floor every day and out in the back room every day, we have to make their life easier. Particularly if we're going to add all these incremental responsibilities upon them, we have to find ways to make their life easier. And that really is the territory that we are playing in, because what you don't really realize when you first come into the retail sector is the extent to which management relies upon information flowing from those stores in order to make better-informed decisions and just how difficult that exercise is.
Ben Chamberlain:
So it's not new that we want retail store associates to be answering questionnaires, to be completing reports, to be completing checklists, to be providing photos and videos to help management that can't be at the physical store to understand what's going on in that location. But we've gotten ourselves in knots. Over the last 20 years or so technology has continued to improve and improve and improve, and the concept of online shopping into omnichannel has evolved and evolved and evolved. The problem is that in all of that change, in all of that incremental lift, we haven't seen the same amount of attention being put on what we're asking from the stores and how we're collecting that information. And so for store associates, we have to make their life easier. And the benefits of that for the business are we might actually be able to do something with the information that we're gathering.
Ben Chamberlain:
What we've gotten ourselves to now is a point where all of this reporting is being completed by stores. It's taking an enormous amount of their time, it's taking them off the shop floor, it's taking them away from customers. And it's going into a big black hole that is only ever referenced when something goes horribly wrong. And it makes sense that that's the case because there's no elegant way currently to take all of that information that's been collected from a massive portfolio of stores and think about how to do something proactively with that information. Because it's not being aggregated, it's not well organized, it's not being presented to anyone in a way that says, "Hey, this is insightful. Let me make a better decision because of this information." And so for us, what we say is, "If we can make the life easier for the store associates, then we are absolutely going to make life easier for management because they're going to have better data on which to make decisions."
Ben Chamberlain:
So as I think about that one layer deeper, and I take a store associate who is trying to work out how to maybe dress the mannequins, set up a display in their front windows, organize their back of house, we need to make their life easier. How do we do that? Well, they're being provided with a list of questions they have to answer on a periodic basis around that particular area, whether it's their visual merchandising setup, their back-of-house maintenance, their store operations. And that's essentially giving them a playbook on what's required in order to be as successful as possible in the day.
Ben Chamberlain:
One step further is that we're looking at how the store looks and everyone's sharing photos on a really regular basis in a centralized tool. So if I'm thinking about how to dress my mannequins or set up my windows, I can look at the broader fleet of stores and say, "Well, from which stores can I take inspiration? How can I measure myself against my peers and get a sense as to how well I'm doing relative to those stores that surround me?" And with that comes confidence and empowerment and this sense of connectedness. So if we can make the life simpler of store associates, we can also make them feel more connected. We can make them feel more empowered to be successful. And that's got to be for the benefit of the business as a whole.
Steve Katz:
Yeah. So the sharing of the information, the empowerment. What's the right combination of technology to deploy, to address those sorts of issues?
Ben Chamberlain:
This is such an exciting time for technology in retail. It's also somewhat overwhelming. We've spent the last 10 or 20 years thinking that we need to try and get to a single platform that's going to deliver across the entire gamut of our retail business. With the advent of cloud-based technology, we're seeing software platforms emerging out of nowhere that are looking to solve very discreet specific problems. So the challenge for retails is to think about do we take a one-stop shop approach or do we take a portfolio approach where we look for what is the best of breed to support different aspects of our retail operations and other parts of our retail business. We firmly believe that the future is a best-of-breed approach where a retailer says, "Okay, we have these certain problems to solve and these certain opportunities within our business. What technology is going to support us within each of those? And to what extent can we tie them all together so that we don't create an overwhelming experience for our retail teams?"
Ben Chamberlain:
So to give you an example of some of those in the financial space, there's an enormous amount of investment going into delivering business intelligence against the POS data and against the inventory data and other data that's coming through for retail business. All of that binary financial data. And that is great news for retailers. When I talk to the people that are out in stores, the district managers, the state managers, they have at their fingertips analysis they could have only dreamt about five or 10 years ago, that's allowing them to really focus their effort and attention on those stores that need the support the most. But they're doing that based purely on numbers. They don't necessarily have the context. And with that context comes a much greater level of understanding.
Ben Chamberlain:
And so we think that there's a role to play, not just for ReStore for Retail, but for many other businesses to contribute data that may then deliver context against that financial information. So if I think about foot traffic data, there are some fabulous platforms now available that will deliver physical technology into stores that then allow for a very, very deep level of understanding of the foot traffic going into the stores as a point of context. It doesn't in and of itself deliver all of the necessary information, but that's not what we're going after.
Ben Chamberlain:
With these financial tools that are delivering the business intelligence, there's an opportunity to plug in other data sources. So things like weather data. What is the impact of weather on sales over time? And much like we're thinking about weather and foot traffic, we think it's critical that we think about all of these reports, all these questionnaires, surveys that are being done and have been getting done for decades in retail stores and turning that into a data source that can also deliver in context. So that when these stores are spending time completing these reporting requirements for different parts of the business, that it's not simply sitting in a waiting room waiting for something to go wrong in order for someone to think that it's worthwhile going and absorbing that information.
Ben Chamberlain:
That's not a criticism, it's a reality. When you have a fleet of stores and they are all reporting on different platforms with each different report. There is no sensible or realistic way that information can actually be consumed in a proactive way. So it's become a reactive tool. And we think that that is a very important ingredient. So if you can imagine I'm interrogating the financials of my retail business, and I'm seeing to what extent are the dials moving relative to some of these non-financial metrics. Whether it's the operational standards, the visual merchandising, the employee pillar, is it the foot traffic data? Is it the weather? What are the correlating effects? If we can start to think about that, then actually this portfolio approach becomes incredibly powerful in thinking about what store do I need to focus on next and why?
Steve Katz:
Yeah, that's incredible. I mean, when you put it that way, the power of that, you can really start to see the power that could deliver. And so that's from the operational standpoint. And then in terms of allowing for some of those inputs and allowing for people who are within those individual store environments to gain that sort of access, and have that sense of inclusiveness and understanding of the information and the best practices across the organization, what are the devices, what are they using in the stores themselves that allow for that?
Ben Chamberlain:
Well, when we first started building this business, one of the observations we made was that you have this often 10 or 20-year-old computer that sits in the back room of the retail store. And every single store associate now has a $1000 supercomputer in their back pocket. And of course, I'm talking about their mobile device. Now, since we began this journey with the significant growth in omnichannel and the idea of experiential retailing in stores, it's created the need for tablets to be deployed into stores. So most retailers now, if they don't already have an initiative in place that will ensure that all stores in their fleet have some level of tablet device that's going to be necessary for all sorts of touchpoints within the business, both internal and also customer facing. And so the thing that we love about mobile is that it's exactly that. It's mobile.
Ben Chamberlain:
It gets a store associate out of that manager's office or out of the back room. It gets them from behind the cash register, it gets them walking the floor. And of course, as we think about what some of those pillars are of experience, movement is one of them. And so to be able to engage with customers, to be able to be floating around the store and also in latency periods be completing your reporting is a really powerful component of that. But, Steve, you touched on this idea of this connectedness that those store associates feel once they are given more access to information. Can't tell you how profound the feedback has been around the extent to which those store associates feel more connected to management than they ever felt. And again, this idea that a store associate turns up each day with every intent to do the best that they possibly can. And so how can we build a system around that store associate so that we can empower that?
Ben Chamberlain:
Store associate wants to be able to engage with a customer when a customer walks in or has an inquiry. Doesn't want to be stuck out in the back doing reporting or thinking about which of the five or six platforms they're to be using in order to complete that requirement. The sense of profound, overwhelming pressure that those store associates feel when they're constantly behind the eight ball in ways that they don't even understand, because of the lack of synchronized tools that they're having to use, is quite exceptional.
Steve Katz:
Yeah, I'm just fascinated by the potential this would seem to present, and I wish we weren't running out of time as we are getting to the end of our available time. Is there anything else you wanted to share about either what you see coming within the next year or technology that's on the horizon?
Ben Chamberlain:
Steve, we're hearing a lot about these pressures that retailers and general business community are facing with its inflation, supply chain challenges, staff retention, and engagement. But really in any given year, there are series of headwinds and a series of opportunities. What excites me about retail is that it's having to deal with it almost in the same cycle as the fashion cycles. There is always something new that is throwing in some level of complication or some level of opportunity. And so I'm excited and I'm proud to be in this retail community because I see so much innovation and excitement about how to deal with those challenges any quarter, any year. So I don't believe that we should be feeling downtrodden or that we shouldn't be otherwise feeling excited for the future. What we need to keep doing is looking for opportunities for refinement. And so as we move into 2023, what I'm thrilled about is the extent to which retailers are talking.
Ben Chamberlain:
They're talking about how they can do better by their staff, how they can provide greater opportunities, how they can defend their position in the market, how they can expand their offering. Interplay with other global requirements around sustainability. So what I would love to see is just more positive energy into the retail community, and I just love being around it. I think technology can play a really important role. I just hope that, as we move into next year, people can be thinking about what they need to do on the other side of the coin. They've spent a lot of time, and money and investment on how to unlock sales opportunities through omnichannel and through online. We need to start seeing that investment back into the stores, into the operations and into the people within those store environments.
Steve Katz:
Excellent points, excellent points. Well, Ben, thanks so much for sharing those insights and for joining us today. And can you let us know how people can best get in touch with you, whether it's by email and/or phone?
Ben Chamberlain:
Absolutely. Thanks, Steve. Look, you can reach us at BChamberlain@restoreforretail.com, or my cell is +61 427 088 493. Or please reach out to us at www.restoreforretail.com.
Steve Katz:
All right, great. Well, thanks again, Ben. And listeners, if you're involved in retail operations or are a lender with retail businesses within your portfolio, I encourage you to reach out to Ben to discuss your current situation and how the strategic deployment of new or enhanced business intelligence tools, like the ones he talked about here, and just some of the great insights that he has could benefit you or your clients moving forward into the coming year.
Steve Katz:
And as always, we hope that this Smarter Perspective Podcast provided you with at least one key takeaway that you can put to good use in your business or share with a colleague or client to help make them that much more successful moving forward as well. And one more thing, please remember that you can check out more great podcasts and articles featuring timely insights from Hilco experts at hilcoglobal.com/smarter-perspectives.
Steve Katz:
Until next time, for Hilco Global, I'm Steve Katz.