This blog was written by Joe Williams
In this series of blogs I’ll look at what this could mean for the Retail industry in 2023 and offer useful tips on where you should begin to look for cost savings within your organisation.
Firstly we should say that it’s not all doom and gloom. The U.K Retail Industry body, The British Retail Consortium, has some hope for later in 2023 and into 2024, when it expects to see a bounce back in sales. Nevertheless, in the meantime, times are hard for many retailers.
In each of the blogs in this series, I’ll focus on one particular area of a retail business operation where cost savings are often made. This will include a range of areas such as technology and automation, supply chain, packaging, staff turnover and knowledge management.
Firstly it is important to remember that operating a retail business often incurs a large number of expenses. These costs can quickly mount up, so we must understand what is essential to running the business and where you can start to make some savings. These costs are often referred to as operating expenditures (Opex) and include fixed costs such as rent, salaries, stock, shipping and packaging.
It’s a real challenge to lower your Opex in Retail, without affecting your product quality or customer service. A good approach is to understand and map out the business’s operating model, from start to finish and beyond. This will give you a detailed understanding of where time and costs are spent and ensure that no areas are overlooked.
The first step to any improvement to your business is to understand the status quo. ‘How are we doing things right now?’
It is often a powerful activity to create a visualisation of your entire business (AKA a process map). A process map can help to identify starting points for analysis and it has the ability to create a mutual understanding of ‘how things are done right now’. Just by simply doing this exercise, you may find some rapid and easy-to-fix cost savings, or perhaps it will discover unnecessary complexity, weighing down your operations.
Using a specialist process improvement system like Skore allows you to input specific data on systems, roles, costs and much more, directly to each activity. With Skore you have the power to pull out this data into key reports that make it easier to spot the opportunities for improvement. You can also do future state modelling in Skore and test these improvements out, before making the final decision.
Spending some time to understand your business better could generate major benefits to your organisation, as well as some quick wins. I’ll explore further solutions in greater detail in the following blogs in this series. In the meantime, if you’d like to chat about how Skore can help you generate cost savings or just find out more about the platform please get in touch: [email protected]