- April 17, 2020
- Posted by: Jane Lawler
- Category: Business plans, Gardening, Uncategorized
Garden centres are deploying extraordinary tactical agility with a generous dollop of staff loyalty and a large helping of true grit in order to survive the covid crisis.
It’s been just over three weeks. Seems like a lifetime, but in any normal business timeline it’s just the blink of an eye. And yet, some garden businesses have entirely changed their whole business model in that time. I’ve been trawling the garden centres to find out how they’re surviving the covid crisis, what tactics they’ve adopted and how they’re planning to come out on the other side.
Three factors stand out.
- Extraordinary agility has allowed centres to move mountains to adapt and change how they operate.
- Overwhelming loyalty from employees who want to work, despite the challenges and potential threat to their health.
- The grit and determination of everyone in this wonderful industry to battle on in the interest of customers, staff and their gardens.
But despite all their extraordinary efforts, its clear the current trading activity is not a sustainable solution for surviving the covid crisis for more than a few weeks. Maybe the garden sector was just not as well prepared as some other retail segments.
Lack of e-commerce capability
When lock-down first hit it was a huge shock for many independent centres – especially the majority who don’t have fully operational online shopping solutions. Every retailer has a website, and some offer limited online and home delivery options on selected ranges. But few have a full product and plant online offer, and even those that do could not quickly turn on the picking and shipping capacity overnight to cope with the extraordinary upturn in demand.
It’s been truly humbling to see how centres have managed to respond to the challenges. We won’t be able to point to a record Spring in 2020, but many businesses will at least be able to say they kept in touch with their customers, supported their employees and moved modest amounts of stock to keep their businesses alive. It’s not just financial survival, but the future of their brands and reputations that they’re protecting.
Ayletts, for example, have furloughed a significant proportion of their staff but invited volunteers from the team to remain in work to care for the stock, provide customer support and pick and pack home deliveries. The team has really stepped up – they have many more volunteers than they can deploy in the space available whilst maintaining their strict social distancing code.
Centres in the British Garden Centres group each have their own, local active facebook page which are full of snippets of news, images of the centres and comments from the team. This is down to the individuals in the centres who love what they do and simply want to stay in touch with their customers. Judging by the engagement level and the customer comments, it will prove to be a key brand driver for their return to normal trading once restrictions are lifted.
Analogue operations in a digital world
Several centres have trialed a ‘call and collect’ mechanic with limited success. All reported that telephone calls with customers take a long time, especially for those who are less confident about what they want to buy. And the challenge of maintaining order and appropriate social distancing at collection points has proven to be very tricky and time consuming. It seems that customer collections are proving to be less successful than the home delivery mechanic being adopted by many.
But with home deliveries come other challenges. BGC have been recruiting extra drivers and vehicles to try and meet rising demand. And without fully functioning e-shops, including images, dynamic stock management, pricing etc., helping customers decide what they want to have delivered in the first place is the main bottleneck.
Thetford Garden Centre don’t have full listings of products and prices on their non-transnational website. So they’ve taken to creating gardening ‘bundles’ of related and relevant products to try and simplify customer selection. And they’ve used their very well -followed facebook pages to promote these to customers with considerable success.
Small scale operations
Just how much impact can all this new trading activity make on a normal Spring gardening season? Ayletts told me that they had around 15 staff working at any one time, with five delivery vehicles managing several hundred orders every day. But the e mail ‘inbox’ is overflowing with new orders and they’re still catching up with last week. It’s not sustainable for very long, and certainly not a profitable model. But at least it is liquidating stock, maintaining staff morale and building customer loyalty. Ayletts are really battling to survive the covid crisis and will be well positioned to take advantage of demand when restrictions are lifted.
90% of Thetford Garden Centres’ team are on furlough and there is just a skeleton team taking calls and making deliveries. But they’ve cranked up their delivery service from around 15 orders a week to over 500 and dropped their free delivery limit to £30 within 5 miles. It’s not about turnover, however, they really just want to support the local community. Their customers, some of whom are NHS workers, have been very grateful with one sending the team a large bag of jam donuts to say thankyou.
Another centre told me that, despite having a functional e-commerce site, in their first week of trading exclusively online as a result of the restrictions, their turnover was a tiny fraction (less than 1%) of the previous week’s normal retail trade. Part of the problem is the logistics and the challenge of cranking up for a more than tenfold increase in demand with existing facilities and staff.
More than one of the independent centres I’ve spoke to have taken the decision to temporarily suspend the online shopping aspect of their websites to allow them to cope with the outstanding order book. Some have blocked all incoming telephone inquiries and substituted a recorded apology message because the number of calls has become entirely unmanageable.
And a quick tour around one or two larger garden centre online shops revealed limited availability, even on plants, as well as extended delivery timescales of up to 3 weeks. Demand from consumers is clearly outstripping capacity, even for the more sophisticated online operators.
Lessons for the future
A failure to invest in scaleable online trading functionality and the fulfillment capability to support is now a real problem. Many centres have historically justified the decision by pointing to their ‘destination’ status and the importance of their restaurants and cafes. But the decision to hold off investing adequately in e-commerce alongside their bricks and mortar operations is now forcing suppliers and brand owners down a ‘direct to consumer’ and Amazon routes. They have no other option if they are to survive.
For some garden centres the financial assessments and employee health considerations have led to a complete suspension of all trade. From a purely financial perspective, they may come out of this crisis in a very similar position to those who have doggedly struggled on. But, they’ll need to work hard to attract back customers who have found alternative suppliers in the meantime. They too will wonder if the provision of a really efficient online offer might have protected them from the worst of the crisis and helped to build a loyal online following.
The experiences of the past few weeks should make centres review their approach to online trading and question if a fully e-commerce enabled model might give them better protection for the future. Maybe an opportunity for a serious third party fulfillment party who can cope with the fluctuating volumes?
Centres who diligently collect and manage information on their customers through loyalty schemes will be benefiting now. Re-enforcing brand loyalty, prioritising orders and deliveries with a known customer is targeted and more manageable. Targeted marketing activity and offers can significantly improve conversion rates and increase basket size which in turn improves profitability. Insightful management of sales and marketing activity based on segmentation and understanding of the customer is a well established profit driver. Amazon, Facebook and Google are testament to this fact and garden centres will need to embrace similar use of data to drive their own strategies post-covid.
For now, centres seem to be prioritising four key issues
- managing operations to keep staff safe
- maintaining the customer-brand relationship
- looking after perishable stock
- controlling costs
As soon as we are through this, garden centres might do worse than consider developing their whole digital sales and marketing approach. Maybe this crisis is the wake up call we needed.