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Industry to consultancy: Heather Naylor on keeping up with change

Heather spoke about trends in the retail and consumer goods sector on the Venari Podcast

‘For the clients I've been working with over the last 12-18 months, it's all been about how do they cut costs. But I think whereas previously it's been, you know, “Let's nibble away at this line, let's nibble away at that line,”’ says Heather Naylor, Retail specialist. ‘Instead, now they're having to think a little bit more fundamentally about how they do things differently.’ For over a decade, Heather has enjoyed varied experience working both in the retail and consumer goods industry as well as in consultancy. Mark Collins, Head of our Retail & Consumer Goods practice, has known her for a long time; he was pleased to catch up and get Heather’s insights when she joined him as a guest on the Venari Podcast recently.



COVID and the cost of living continue to have a huge impact on retail

Unsurprisingly, the effects of COVID-19 continue to be felt in retail – though not necessarily in ways that one might expect. While online shopping increased massively during the pandemic, Heather notes that ‘since then, there's been a really big resurgence in stores. So online sales have actually really dropped off over the last 12 months or so as people have been really wanting that in-real-life experience again.’ However, this hasn’t necessarily translated effectively into in-store purchases; footfall may be up, but inflation and the cost of living crisis means that ‘customers aren’t necessarily buying in the same way’ anymore.

Cost base and staff shortages

Heather notes that workforce numbers are still down on pre-pandemic levels. While this is a significant problem in itself, rising cost bases is the main issue for retailers at the moment. ‘If you look at the supply chain, that's massively increased in terms of transport costs, the logistics cost, the costs of warehousing, because we have had a lot of disruption – not just due to COVID, but also obviously the war in Ukraine.’ Increasing numbers of businesses are ‘nearshoring’, or manufacturing closer to home. As Heather notes, this practice ‘gives you a lot more resilience in your supply chain, but obviously it also increases the cost from when you're sourcing in the Far East.’

Clients prioritising P&L management, from grocery to fashion

Just about every P&L line has gone up for retailers – and managing these is a top priority for Heather’s clients. Grocers, for instance, are having to nationalise lines that are no longer cost-effective; furthermore, it is easier to keep goods in stock if the range you offer is smaller. Heather points to the rise of Aldi and Lidl, whose low-cost base was enabled by their narrow selection of products. That way, ‘it's just much easier to get it through your supply chain, get it into your stores. And now we're seeing some of the big grocers, for example, having to look at what they are selling because they can't afford that range.’

Supermarkets are not the only sector affected by such concerns. Heather’s fashion industry clients are also having to make tough calls and conduct plenty of research to keep down costs. Hard analysis of the target market, product, and business model are key for fashion retailers in the current climate.

‘It isn't just a case of, “We'll try and negotiate harder with our suppliers this season and we'll try and get the costs down.” They're going to have to do something differently.’ Heather Naylor, Retail specialist

What can retailers do?

Heather has some practical advice for retailers: ‘I would say really think about what the absolute differentiator for you as a business is. What is the reason that a consumer shops with you? Focus on that, and then everything else is just noise. You need to do what you're special for and what makes you unique. You need to do that really well. Everything else, you should just be looking to optimise, automate, do as low-cost as possible.’

What does this retail market mean for consultants?

These are difficult times for retailers, and it stands to reason that they should turn to consultants for advice. As such, consultancy firms are very busy at the moment, though Heather notes that it’s normal for there to be peaks and troughs of particularly hectic activity – and that when it comes to the latter, consultants always manage to pull through. She notes that many consultancies are currently looking to hire from a wider breadth of profiles than they might usually go for. Historically, beyond entry-level roles, consultancies have been less open to hiring candidates from industry; talent might ‘do the merry-go-round’, as Heather puts it, from one firm to another. Now, however, she says ‘there's been a real recognition of the knowledge and experience of how a business works’, and that it helps to take teams of people with different backgrounds to clients rather than those who have only ever worked as consultants.

‘I think there’s definitely going to be more flexibility in the hiring profiles, more diversity, which I think is a really good thing.’ Heather Naylor, Retail specialist

What about senior talent?

It’s great that consultancies are more open to different types of candidates – but does that apply to senior talent? Are more established managers likelier to go from industry to consultancy than the other way around? It depends on what that person’s done in industry, Heather notes. Some things in particular are quite specific to senior roles within consultancy around project management and ‘how you manage teams – and not just your own team, which you would typically have in industry,’ Heather says. ‘How you sell to clients, how you structure projects, how you can write a proposal and pitch to a client. At that kind of senior manager level, sometimes people in industry don’t have some of those skills that you’re really looking for.’ That said, Heather concedes that she’s seen candidates with early experience of consulting slot nicely into strategic and operational roles in industry; those with a good mix of IQ and EQ will go far no matter what.

At Venari Partners, we are passionate about helping businesses in the retail & consumer goods sector, as well as management consultants, with their executive talent solutions. If you would like advice or assistance, please don’t hesitate to get in touch.


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