Problem Solver: What's your verdict on how the supermarkets of today?
Q: What are your views on the levels of customer service offered by supermarkets today?
A: It has been over a decade since I sold Superquinn, and the marketplace has changed enormously. The growth and market share of the discounters, consumer appetite for value and the pressure on margins have changed the landscape in a significant way.
Many initiatives we ran in Superquinn, like free play houses, bag packers at every checkout, etc, are probably no longer sustainable. What is sustainable though, is ensuring that staff are polite and greet customers in a positive way. Even those simple steps are not consistent across the Irish food retail landscape and I wonder has training suffered because of cutbacks in budgets?
I can recall many decades ago when Ireland was experiencing a previous recession, my financial controller approached me with a list of possible budget cuts. They all made perfect sense but the one I strenuously objected to was a cut in our training budget. After some discussion we actually increased the training budget at a time when all of our competitors had reduced or eliminated their training.
The result was that we were able to offer even stronger customer service at a time when our competitors were weakening in this area.
If I read and listen to the adverts to all the multiple supermarkets they mainly talk about price and occasionally quality. I have not seen a message about customer service initiatives in the last number of years, which suggests to me that it is not top of the propriety list. I have no doubt that at individual branch level there are managers and owners that are passionate about delivering world class customer service, but it would be interesting to see at boardroom level how often customer service is put on the agenda.
Q: I am in the manufacturing business but am finding it difficult to compete with imported products. Can you direct me to where I might get some advice?
A: Over the decades we have seen many sectors of Irish manufacturing completely wiped out by cheaper imports. You are clearly thinking ahead and trying to ensure that the same does not happen to your sector.
A lot depends on what you are manufacturing. If you are producing a product that involves a lot of craft and human input to give it a point of difference rather than reduce your labour, your time might be better served talking up why your product is different to the imported one. There is always a danger the customer will look at both the mass market-produced product and your product and think they are the same thing, if you don't do a good job at telling your story.
In order to succeed in the mainstream market, you have to ensure that you are embracing all of the possible efficiencies that you can gain. Enterprise Ireland have some great supports in the area of lean manufacturing. I have seen a number of businesses who have participated on this programme and have been shocked when they stood back and looked at what inefficient practices they had.
Work practices and automation can be also worth exploring. In most cases business owners are not interested in reducing their workforce, but rather pushing more volume through without increasing their wage cost.
Of course, you also need to look at the cost price you are paying your suppliers for raw material. It may be worth your while to tender all of your raw materials, or at least the ones where you are spending the most amount of money.
All of the above items can be tedious and certainly are not as exciting as being out in the market place, selling your product. They will however underpin everything you do, and determine your competitiveness in the market. Assigning somebody senior in the business to look at your competitiveness, and using external supports such as Enterprise Ireland would be a great first step.
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