Big companies make ‘big deals’, the more global the better. This is without a doubt a huge financial benefit and makes great sense on paper. But how many of these ‘big deals’ actually put the customer first?
How much is pandering to the power of the large supplier to force their extended distribution?
What is the cost to the overall product offer and customer experience which, given the enforced change to retail in the current times, will be even more important?
These deals are lucrative for the bottom line and, of course, the Finance Directors applaud. However, this is not dynamic retailing!
In most of these ‘big deals’, made at the highest level, buyers are told which products/brands they must buy, what space they must allocate and which promotions they have to run. It’s a huge frustration for a buyer to be handcuffed to a product that must be given shelf space – regardless of the market positioning or customer needs.
What retail space is left for creativity, innovation, discovery and newness – elements which stamp the individuality of the buyer?
The global deal is not limited to certain categories and has been a strategic move to reduce the number of points of contact, improve terms with key suppliers and streamline the business.
Some categories with a higher share of the space mix can ‘swallow’ these deals more easily than others, making it a lucrative strategy.
However, in Fashion and Accessories, space is generally much more limited, resulting in a predictable collection of brands governed by global deals and a distinct lack of innovation.
