BikeBiz

Several issues come to mind, but primarily, why would independents want to share detailed sales data with Halfords? PLCs and other large retailers have to publish some performance data due to ownership and turnover; therefore their summary performance and some further details of their business are transparent. Furthermore their formulaic formats mean that it is relatively easy to assess the make-up of their business and they regularly trumpet details of what’s working for them, as we see published here. What is more of a mystery – to the corporates at least – is the make-up and performance of the majority of the UK retail trade, conducted via the diverse independent sector. The suppliers (especially the large ones) are generally aware of this detail, because they supply it and now that so many orders are supplied on a just in time basis, trade sales increasingly reflect retail sales. An increasing number of suppliers now provide click and collect services - a trend which is certain to continue expanding - meaning that suppliers are seeing the detailed sales trends first, as they re-direct custom to their retailer base. Suppliers are responsible for informing their retail customers of sales trends, what’s performing and what’s not, it’s what they do and the quality of this information exchange has greatly improved over the past 2 decades. Larger suppliers even now hold range reviews with their customers, sharing information and business plans, some even provide EPOS solutions, which allow for day to day, detailed retail sales analysis. The sophistication of the UK supply base has also developed materially over the past 20 years and it is telling, that despite numerous efforts to create sales sharing groups and many external market research exercises, the industry make up remains a puzzle to those not trading in it, because suppliers have not wanted to take the opportunities to share detailed data. The simple answer is that information is power, sharing it with your customers is useful; the wisdom of sharing it with your competitors and those who compete with your customers is questionable. For independents the challenge is not only the value of transparency when the business formats are so varied, but the task of gathering and consistently sharing detailed data. As many of us will recall a business was set up by a very committed individual solely for this purpose, but ceased operating because it proved impossible to get regular, detailed data. The IBD sector as a whole has proven that it isn't really interested and as we all know, a little (skewed) information can be more dangerous than useful (as the current regularly promoted myth that the UK cycle trade is having a great year is proving!) Lack of desire, need and the not insignificant related costs are the reasons the specialist UK cycle industry doesn’t share information with third parties. Exercises such as this cost money, GfK would obviously and quite reasonably need to sell this summary data to third parties, which as previous market research has proven, tend to be large businesses outside of the trade who are looking to enter the market. As someone is going to have to fund it, wouldn’t it be best if Halfords and the like who are going to benefit most from greater transparency did so out of their own coffers?

Hi Billy, there are points in your comment that GfK will be better poised to answer, and I'm sure if anyone wants to address them to GfK directly (yourself included) they'll be more than happy to answer. There are a couple of email addresses/phone numbers at the foot of the story. I'm intrigued by the suggestion that a little skewed information has proved 'dangerous' rather than useful - not sure who has felt the danger in the trade? I think the point is that GfK are trying to not provide a little skewed information, but something much more useful and wider than we've seen previously - on a regular basis too. Regarding who should fund it, I'm pretty sure GfK will have considered this and are fairly confident of their business model. They're not asking for any money from those who take part in the research. Finally, I'm intrigued that vibrant, strong cycle markets like the one in Holland for instance think the venture is worthwhile, but you don't think it's right for the UK. We're not THAT special are we…?

Jonathon, I didn’t question its worth (except re quality issues) or suggest that it isn’t right for the UK, I simply tried to summarise experience re why it’s not been achieved and why delivering something of real worth will be a significant challenge. I don’t personally believe that many of the barriers to delivery have been removed, but the value has gradually reduced over the years due to the progress that I’ve endeavoured to highlight. Before investing time and money in such a project it’s worth asking how you address a key barrier: why give up something of value to your business and why give it to a competitor? Obviously if you get something of equal value in return, but rarely is anything ever of ‘equal’ value, hence someone is always surrendering some power to another. Barriers are either immovable or simply increase cost to address and ultimately these exercises have always faltered over cost, which reflects limited desire by all parties involved to invest to make it happen. The obvious way to get around giving valuable independent data to Halfords and other large third parties who ultimately threaten the specialist network (it’s quite possible that the likes of Tesco would like and pay for such info to assess further investment opportunities, but that might even put Halfords off!) is to only share IBD contributions amongst IBDs. However, IBD operating formats vary greatly; this reduces the value of the results vs. the work involved, to them and the overall value to third parties who’ll ultimately be funding it. RE GfK: I feel that as you are involved in the project you are best set to discuss any issues you might feel are relevant with GfK, but feel free to direct them to me if of any benefit. I do wish GfK the very best with this, but forewarned is forearmed. It is obvious how they like others fund such exercises, but let’s not forget Allegra Strategies just a couple of years back, they initiated cycle market research based upon their proven experience in another UK sector, they were warned it would be tough, but said they’d overcome! RE HOLLAND - it’s not so much about the relevance of the country, although Holland is different in structure and operations, the US would have been a better comparison, but historics, mentality and market structure do impact. But heh, what do I know, I’ve only had 36 years’ experience of the UK retail sector (incorporating retail analysis)? RE LIMITED DATA: if not thoroughly interpreted or presented poorly is always dangerous in my view. It can mislead business and investment, it can hinder businesses, which are wanting to benchmark it against their own experiences, it can mislead consumers who in turn can impact upon business – recent cycle example is consumers believing all the silly press hype that things are buoyant seeking retail discounts, because we’re all ‘having such a great time’. In my experience poor info is generally as destructive as good info is powerful, quality of interpretation and presentation are key. I have recently been speaking to ACT representatives who have some industry data and varied info on buying patterns, business openings/closures, employment etc. and this better reflects the reasons for the disappointment, sometimes verging on anger, that is regularly being expressed on the industry forum about the over hyping of recent trading. The sun shining in August doesn’t make the year or offer much comfort beyond mid-September.