Thursday, September 13, 2007

Retail therapy UK style


Every so often I am reminded that London really isn’t Sydney, and England really isn’t Australia. It’s small things that refresh your memory. Public holidays are always called Bank Holidays. The main street of any town or suburb is called the High Street, regardless of its actual name. Fiery Indian curries are the nation’s most popular Asian dish, rather than the light, fresh ingredients of Thai dishes I enjoyed in Sydney. Mail is still delivered on a Saturday. Shopping malls aren’t the primary mode of retail therapy.

There is one retail concept I still can’t get my head around. I’m talking of Argos . This is simply a department store that sells its wares using nothing more than rows and rows of catalogs dumped on simple wooden reading stands. This has to be one of the most quintessentially English retail traditions that I ever encountered.

Incredibly, Argos is the largest general goods retailer in the country. It operates 680 stores, each of which consists of an open hall populated by catalogues. Rather than wander through departments stocked with furniture, clothing and homewares; customers simply thumb through a giant book that lists 18,000 products.

Once you find your desired item, you take the stock number to a cashier who then arranges collection at an instore desk, or via home delivery. At first I thought Argos’ entire range was only available on home delivery. However, when Garry went to buy a new microwave in June he discovered that most stores hold at least 10,500 lines onsite in a hidden warehouse.

In effect, Argos is a traditional department store that’s simply done away with the floor space required to display traditional showroom samples. I find it staggering that UK consumers prefer to thumb through a dog-eared catalogue in an austere, slightly worn hall rather than visit a more conventional department store.

While I can’t imagine the concept working in Australia, it clearly works here. Argos processed more than 134 million transactions in its last financial year, generating profits of £325 million on sales of £4.16 billion. An astonishing 70% of UK households shopped at Argos over the same period. I guess our humble microware is in there somewhere.

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