Today’s Riff: The Importance of Being Different
It’s sad, if unsurprising, that Poundworld, the discount retailer, has been forced to close all its 335 stores, resulting in 5,000 job losses.
Over the past 10 years, the UK discount retail market has exploded. Led by Poundland, its growth attracted a wealth of new competitors including B&M Bargains, Home Bargains, 99p Stores and Poundworld, as well as the grocers Aldi and Lidl.
A rising tide floats all boats. But as the market matured and the tide slightly turned, many of these players have found it much harder to grow and remain profitable. Poundworld has been a victim of this reality. The key reason for its demise has been its lack of any clear competitive advantages.
Without any real advantages, you will fail to grow profitably even in the most attractive markets. Vodafone, for instance, lost £ millions in the huge and fast-growing Chinese market, while Tesco lost over $1.5 billion when its Fresh & Easy brand failed to connect with high-spending US shoppers.
Like Poundworld, these players were unable to develop any material competitive advantages. As a result, they failed. What about your business? Are you clear on your advantages and how they can be developed to drive profitable growth? Or, like Poundworld’s management team, are you simply looking for your market to deliver the growth and returns you’re after?
Off The Record: I’m Not Like Everybody Else by The Kinks
And I don’t want to ball about like everybody else
And I don’t want to live my life like everybody else
And I don’t want to stay fine like everybody else
‘Cause I’m not like everybody else
© Stuart Cross 2018. All rights reserved.