Home Centre decides to go in for a fresh look

Sometimes it’s best to ditch what the consultants say. As when they insist that a revamped store should keep a minimal amount of displays and offer up a roomier experience to their shoppers. That such a fitout would be a better fit with today’s design ethos.

For Médéric Payne, CEO of Home Centre, the furnishing retailer owned by the Landmark Group, such talk doesn’t amount to much.

“They call it range editing — a lot of the consultants come in and say “You’ve got way too much stock,”. And they’ll do all the mathematics and say “Chop all of that stock and you’ll make more money,”” Payne said. “What happens is that you come to a point where if you keep chopping you have nothing at the end.

“You only have your so-called best-sellers; but to have your best-sellers and “most-popular”, you have to always have what we call the “halo effect”, which happens when there are a number of products a shopper can explore and find even though you don’t sell them as much.

The people at Home Centre have gone in for a lot of thought into what they should do at the reconstituted near-60,000 square foot store in Mall of the Emirates. The design, colour and stocking elements at the flagship outlet will now be recreated at other locations.

“One of the biggest feedback we had from many of our customers regarding the Mall of the Emirates store was that while it was very popular, it had started to get a tired (look),” the CEO said. “Like all businesses, you get so caught up with growth that if you don’t get back to your older stores at some point, then they’ll be far too outdated.

“Once we do the final post-implementation review (at the new-look store), we will then be able to look at all our estate and then say this is how the core of our offering is. It’ll probably take about three — maybe four — years to redo the whole estate. And it will run simultaneously with new store openings.”

A makeover will go down well for Home Centre, one of the key margin-yielding businesses for Landmark. There are currently 73 stores across the Gulf and Lebanon, including 17 in the UAE. There are another 25 in India. An ideal-sized outlet would, according to Payne, be in the range of 50,000 square feet.

As with the store at Mall of the Emirates, it’s product mix has also gone through changes. “In the space of six months around this project, 50 per cent of our existing range have been renovated and we are adding an additional 20 per cent to the catalogue,” said Payne. “We have increased the range to 10,000 SKUs (stock keeping units) as opposed to under 8,000 before. It was oscillating between 7,000 to 8,000 depending on the season.”

This is also helping the retailer gain greater flexibility on the pricing range. But the CEO is yet to make up his mind on whether the time is opportune to go in for a brand extension targeting a higher value clientele.

Average spend on the furniture range at Home Centre tends to between Dh3,000-Dh5,000, while the premium end would be Dh10,000 and more.

“We had done some extensive research a year ago ... did a massive survey, asked thousands of our customers what would they want and what are they looking for,” said Payne. “Most of it had customers wanting the basics of retail.

“The biggest thing our customers came out with that most retailers in this region don’t do warranty on furniture, it’s a big issue at the low end part of the market. That meant we launched a warranty offer on everything at the MoE store.

“We are going to start with this store and then roll out — but not everything straight away. We’re just trying to bring this in correctly

source : gulfnews