Amid the national headlines proclaiming store closure after closure, it’s encouraging to see those making headway in this new retail landscape. Land of Beds started life in 1974, and has grown to become an examplar of independent multichannel furniture retail, opening a third store in Wigan last year – however, writes MD Mike Murray, upscaling a retail business is a good deal more complex than it used to be …
It’s the age-old question – do you stick or twist?
Or, to put it another way, once you’ve established a single profitable store, do you then dare to expand to a second? If you already have a portfolio of successful premises, do you settle for ‘comfortable’, or do you keep chasing a bigger dream?
In 1974, my grandad Harold C Murray opened a home furniture business in Merseyside retail premises, and a decade later, he passed the company on to my dad, Mike Murray snr, who opened a second store.
After I had completed my Marketing Masters Degree at Liverpool University, I joined our family business in 2008.
Our core values are helping communities to sleep better, giving to local causes and promoting health and wellness. It is an ethos that has brought Land of Beds comfortable success – serving happy customers in the immediate vicinity of our stores.
We could easily have stopped there, but I had arrived at a time when global ecommerce sales had topped $1b for the first time in history, and I saw an opportunity to scale up our business and to create a website that would allow us to sell high quality beds and mattresses to consumers UK-wide.
By 2013, we had been Highly Commended at the National Bed Federation Awards in the E-tailer of the Year category.
This multichannel strategy continued to deliver a seven-figure increase in turnover, year on year, and, in 2017, we opened a third store – in Pemberton, Wigan – and we were voted Britain’s Retail Family Business of the Year.
Scaling our business didn’t happen overnight, but we’ve learned a lot along the way – lessons I’m pleased to pass on to readers of Furniture News …
Ecommerce
In 2016, the UK Cards Association revealed that card users spent £154b on the internet, with UK households splashing out more than in Norway, the US and Australia.
If you don’t have an ecommerce website, you are missing out on revenue from customers who can’t easily travel to your premises, or who prefer to do their shopping online – therefore, this is one of the simplest things you can do to scale your business without opening new stores.
Once you have created your website, however, the work doesn’t stop there.At Land of Beds, our site is a continual work in progress, so we have an in-house web development team that fine-tunes the user experience online and implements new technology – keeping us up to date with the latest innovations.
As well as web developers, we have an ecommerce team who keep stock levels updated, as well as writing new product descriptions and processing online orders.
A web presence will lead to an increased influx of customer enquiries. To handle these efficiently and professionally, we have a call centre staffed by sales advisers who have completed the National Bed Federation’s official training programmes to ensure they offer expert advice.
Search Engine Optimisation (SEO)
Once you have created an ecommerce website, you’ll want more potential customers to see it. Mastering SEO will help you to scale up by getting your page noticed for relevant product and brand searches.
Pay Per Click (PPC) adverts – also known as Google AdWords – start tracking customer activity from the moment someone clicks through to your website. Data includes the webpages they click on, the items they put in their virtual cart and the amount they spend at the checkout.
Because you set your own budget, which you can reduce or increase in real time, it’s also an effective way to monitor and control your spending. However, as soon as your campaign is turned off, your ads – and with them, the ‘shop window’ they create for you – disappear.
A more cost-effective strategy in the long term is to invest in the time and expertise it takes to get your website listed prominently on the first page of free suggestions that Google presents to customers when they search for the items or services you sell. Every webpage has a Google ranking, which is determined by the number of links going into it. The higher your webpage is ranked, the more authority it has.
Increasingly, Google wants to reward high quality, trustworthy websites that answer real questions to increase the level of user satisfaction – therefore, my best recommendation is to build your website around real customer issues. By doing so, ultimately you can become a trusted expert – a Google-recognised authority – on that subject.
Logistics and distribution
If you’re going to increase your customer catchment area with a well-ranked ecommerce website, you will require a logistics fleet, as well as policies and procedures for distance selling that cover returns.
The Consumer Contracts Regulations were introduced in June 2014, and apply to buying online. To be compliant, you need to provide key information to customers such as who pays the cost of returns (if you have a right to cancel and change your mind), as well as clearly stating all additional delivery charges.
British buying culture has changed. The annual Delivery Matters Report, commissioned by Royal Mail, found that 84% of shoppers using online marketplaces consider a seller’s delivery rating a crucial factor in deciding where to buy from. One in four shoppers now pay for delivery subscriptions which include unlimited next-day delivery. To put it bluntly, when customers make a purchase, they want their goods ‘now’.
To increase the number of delivery slots you can offer – and to become more profitable by capitalising on supplier discount for bulk orders – you may potentially need to expand your stockholding capacity.
Land of Beds opened a new purpose-built warehouse and distribution centre in August 2015 at the mouth of the Mersey Gateway. Perfectly located to capitalise on the nearby motorway network, this has allowed us to realise increased efficiencies in our global delivery operation, which has reached as far afield as the Dominican Republic.
Marketing
Brand loyalty may drive repeat custom from existing customers, but to scale up and engage new buyers, marketing is essential. As ever, a multichannel approach is best, so you’ll need to consider campaigns for audiences both on- and offline that also tie in your in-store activity.
At Land of Beds, our mix includes everything from radio and on-demand TV to regular ads in free monthly magazines distributed in the footprint of each of our stores. Wherever the potential customer is, we want to be too!
What you do every day matters more than what you do once in a while. Therefore, to grow a social media following that is truly engaged with your brand, you need to have a constant, positive presence in their lives. Offer rewards such as competition prizes, and incentivise through exclusive discounts at key buying periods such as Bank Holiday weekends and national holidays.
As with everything, if you don’t have the expertise to devise and deliver a great marketing strategy in-house, consider partnering with trusted consultants and freelancers who can bring these specialist skillsets into your organisation.
Partners
No person (or retailer) is an island – we all need partners with shared values to help us get to where we want to be on our growth journey.
At Land of Beds, we only work with Britain’s best manufacturers that are certified by the National Bed Federation to guarantee outstanding quality, comfort and support. Our partners include Hypnos, Sealy, Silentnight and Tempur, plus many more – the one thing they all have in common is to continually develop new products using cutting-edge sleep science to offer a better night’s sleep.
Look at your own supply chain. Are the manufacturers you work with truly innovative? When was the last time they came to you with a new product, or showed commitment to investing in meeting the future needs of your customer base? Working with partners who are also scaling their business can fast-track you to where you want to be.
People
To respond to market forces and grow your business, you will not only need a bigger team, but different kinds of employees within it (when my grandad opened his store in 1974, there were no web developers on his team!).
So many new channels have emerged over the past three to five years – especially online – that building a talent pipeline is a critical element of any people strategy. Having partnerships with organisations like Google and Facebook can help you keep on top of what opportunities are on the horizon, so you can better understand what skills are needed to seize them.
That said, growth is only possible from a solid foundation. Talent retention is just as important – ensuring your workforce feels that their efforts are recognised and appropriately rewarded, as well as engaged in your company’s journey. Opportunities for career progression and a transparent pay scale can help with this, along with regular coaching and training opportunities.
Places
There are few better feelings than watching satisfied customers leave your store with a smile and knowing your bottom line is healthy – it’s the Holy Grail of retail!
But if you feel you’ve created a blueprint for success at your current premises that you want to replicate at another location, you need to do your homework first.
The data from your ecommerce website can be a good starting point – hinting at locations where high concentrations of orders take place that may benefit from a bricks-and-mortar store.
However, this is only a small part of the picture. With rocketing rent and business rates to consider, triangulating a site that offers good sales prospects at an affordable price point – and with a good transport infrastructure – is no easy task.
Once you have settled on your location, my top tip is to work with local suppliers and tradespeople on any store modifications. As well as delivering cost savings, it also sends out a clear message to the local community that you want to give back to the economy from the start.
USP
What differentiates you from competitors? If you want to put clear distance between your business and the rest of the field, you either need to offer something totally unique, or do what everyone else does, only better!
We have lots of own-label products that are exclusive to Land of Beds – however, where we like to truly excel is in the standard of customer service we offer. Our innovations have included everything from Pay Monthly Options to help people to spread the cost of their good night’s sleep, to Recycle & Removal services.
A good starting point is to establish what your customers’ pain points are, and whether there is an innovative way to remove them.
For further clues about what the customer perceives as your strengths and weaknesses, closely monitor your independent reviews.
Time to decide
To summarise, we are all living through an era of unprecedented change in the retail sector – never has so much changed so often. With the fallout from Brexit still to be decided – and the decline of the high street gathering pace – it would be easy to press the ‘pause’ button on scaling your business.
I personally feel it’s time to be braver and bolder than ever – with challenge comes opportunity. We are incredibly fortunate to live in an era in which technology is making it easier than ever to offer consumers choice, convenience and a competitive price.
Invest in ecommerce. Learn about SEO and marketing. Recognise and reward your staff, and build a talent pipeline – these are my top tips for successfully scaling your business.
It won’t be easy, cheap or fast, but experts agree that the secret to happiness is to live in an atmosphere of growth (having a shared vision of the business we are trying to build gives our Land of Beds team a clear focus, as well as a sense of being part of something bigger!).
Don’t ever get so big that you forget your core values – whether you have one store or a thousand, they should be embedded throughout your whole operation.
I know that my grandad is proud of the service we offer customers and, to me, that is the true measure of our success.
Mike Murray is MD of Land of Beds, a third-generation family-run retailer based in Frodsham, Cheshire. The business has won multiple awards for its innovative approach to digital marketing and ecommerce, based upon a strong traditional retail foundation. This article was published in the July 2018 issue of Furniture News magazine.
