The fight back starts right here” – the words of Gary O’Donovan, NOffLA vice chairman at the association’s recent seminar on “Unlocking the Commercial Growth of the Independent Off-Licence Sector”. O’Donovan spoke passionately about the trade and described the seminar as being pivotal in the recovery of the sector.
“Today is about reconnection” was another theme presented by the NOffLA vice chairman, as he spoke about reconnecting many independent outlets with leading alcohol brands and their suppliers. O’Donovan provided first-hand examples of how his own experience had demonstrated the profit to be made from embracing the leading brands, but on sustainable terms.
Stocking major brands
The logic of O’Donovan’s message was simple: “Why should we stock the brands? Because our customers want them.” He went on to ask if any retailer could afford to be without certain brands. O’Donovan acknowledged the difficulties associated with retailing major brands, including limiting one’s margin. He explained that customers usually make an assessment of an outlet’s pricing policy based on the price of major brands. If those are higher than is typical, then the consumer will judge the outlet to be expensive. “You may have to take a lower margin on a leading brand, but you do so in return for volume sales.”
Sustainable margins essential
While O’Donovan encouraged his fellow retailers to reconnect with any major brands they do not currently stock, he also had words of caution for the suppliers. “My message to the brandholders is that we need sustainable margins.” O’Donovan went on to explain that, in order for the brands and the independent sector to survive – and hopefully thrive – there had to be enough revenue for both parties to pay their way.
The NOffLA vice chairman was passionate about the way forward during this recession. “We must stand our ground; fight for survival; figure it out; work it out. It is a war out there on the high street and brands do have a part to play in winning that war.”