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Talking Shop: 'Do I miss out on sales by refusing to discount?'

James Stacey, managing director of country clothing store O&C Butcher in Aldeburgh, Suffolk, and a member of the International Menswear Company (IMC) buying group.

James Stacey

James Stacey

Our policy on mid-season Sales until now has been “not if we can help it”. We are fortunate in Aldeburgh that we’re slightly removed from the pressures of the high street and larger towns, so haven’t had to participate in mid-season reductions.
Having said that, we are not immune with the likes of Crew Clothing, Fat Face and Joules close by and often discounting mid-season. I have a lot of respect for bigger players who stick to their anti-discounting beliefs, such as Next and Jigsaw. They help restore the credibility and integrity of regular pricing with customers and create a better environment for the industry.

I understand that competition, cash-flow and stock-level pressures will give many independents little option and that their decision to discount is purely pragmatic.

I am always reviewing the situation and it requires increasing consideration each season. This year’s Black Friday and Cyber Monday reductions have certainly had an effect on customers in our sector and, while our sales figures haven’t suffered, customers have definitely bought elsewhere at a discount, because they’ve told me. Perhaps we are missing out on significant extra sales? But if we offer 20% this year, will we be setting a precedent and have to go to 25% next year? I know from speaking to friends in the IMC buying group that intense local competition gives them nowhere to go in terms of pricing and retail certainly isn’t easy. Like many independents, we carry quality brands, hold good stock and try to provide excellent customer service. So as long as our pricing remains competitive, shouldn’t this be enough?

I remain against mid-season Sales for our business and believe it would cost us more than we would gain. O&C Butcher has been here since 1884 and we are very much about quality and service, not just the cheapest price. Sales are vital, but so is margin. I believe in our product range and overall offer and I think full price is a fair price. However, I wouldn’t say I am 100% confident I will always feel the same way. Customers are increasingly well informed and aware that whatever the date, a mid-season Sale is probably happening somewhere!

Readers' comments (3)

  • darren hoggett

    Would strongly advise not to go on Sale and work more with the brands that haven't got the discount ethos. If you have a good clientele, they are not usually the sort who would worry about looking for bargains. It has always worked for us and while you may lose a few sales, on the whole it is better not create a discount culture, because once you start that, you are on the path of no return.

    Darren Hoggett
    Owner
    J&B Menswear Limited/Norwich


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  • Thierry BAYLE

    Like the article suggests it, it is a challenge and opportunity and therefore there is more than just one answer.

    Firstly, if you have invoices to pay, what do you do if you cannot borrow money? You may need to discount or decide to close the shop.

    Secondly, I will raise the real question which is why are discounting and therefore
    have we been buying the right quantity and making it come at the right time?- there is a science behind those numbers - Whos Next is having an extra expert this January to tackle just that every day at the retail expert club.

    If the sales forecasting has been well done ie accurately the discount strategy does not need to exist as such.

    Another question
    Are we discounting to clear excess stock or
    Are we discounting to attract new customers?
    (ie preventing that the customers rush to the competition and spend their £££ there ). In this last scenario, there should be very little numbers of products available on a discount.

    Of course discount may happen to beat the competition.
    How would I feel if Boutique X discounts at 30% and my neighbourhood retailer has no discount on the same product?

    Think therefore working with the right Brands as indicated above and find brands which are not widely distributed in the UK.
    There is more to say of course.

    Thierry Bayle
    @retailfashion

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  • Why does the default response to challenges in retailing invariably seem to be to start discounting? I've been in business for nearly 30 years and have never entertained discounting except at the traditional sale periods in January and July. My company has a reputation locally for not discounting and like James Stacey I sometimes wonder whether we lose out because of this stance. It seems to me that businesses that have to discount are going wrong somewhere, whether that is the wrong stock, the wrong suppliers, a lack of confidence in their abilities, lack of trade or, frequently I suspect, a lack of capital. When I started in business all those years ago I decided, amongst many things, that I would trade at the 'medium to better end', carry good stocks, employ good staff, not discount (whatever the pressures), maintain attractive High Street premises and crucially pay on time - the latter a difficult proposition when starting out. Over the years my company, like many others, has encountered challenging times with recessions, changing shopping habits and patterns, changing customer loyalties, and of course online competition, but we've always resisted the discount 'model'. I've also found that when we choose suppliers who respect our ideals that generally there are far fewer problems and if they do occur we are in a stronger position to address them. I've tried, mostly successfully, to stick to all my original aspirations, all of which require funding - which means making reasonable and fair profits.
    So James, like you, I do sometimes have my doubts but currently won't be altering our non-discount practise which has served us well for the last 30 years.

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