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Woolies in administration - A lesson for us all?

by Dave Fowler
10 replies
Is this a real world example of 'not focusing'?

For decades 'Woolies' i.e. Woolworths have been on just about every high street in the UK, and have been part of the culture. They are regarded warmly.

Now it appears they are going into administration, i.e. bankrupt.

BBC NEWS | Business | Woolworths enters administration

Could this be taken as a massive example of trying to be all things to all people. I'm as guilty as the next person in trying to cover everyones needs with my sites, I don't want to miss a sale. But it would appear this approach just confuses people.

BBC NEWS | Magazine | What is the point of Woolworths?

Is this a lesson to abandon 'general stores' and concentrate on specific demands. It's obviously a lot easier to do so on the 'net' rather than 'bricks and mortar' stores.

Your thoughts would be appreciated.

Dave
#administration #lesson #woolies
  • Profile picture of the author KirkMcD
    Originally Posted by Dave Fowler View Post

    Is this a lesson to abandon 'general stores' and concentrate on specific demands.
    WalMart, Carrefour, Target, still seem to be doing well.

    Poor planning and not changing with the times seems to do in more companies than anything else.

    But concentrating on one niche can kill you faster then being a generalist.
    What happens if the demand for that niche goes away?
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    • Profile picture of the author Angela V. Edwards
      Originally Posted by KirkMcD View Post

      WalMart, Carrefour, Target, still seem to be doing well.

      Poor planning and not changing with the times seems to do in more companies than anything else.

      But concentrating on one niche can kill you faster then being a generalist.
      What happens if the demand for that niche goes away?
      This is the whole theme behind the book "Built to Last" which was required reading at my former job.
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  • Profile picture of the author Lee MacRae
    In general terms I think it is very difficult to equate brick and mortar companies with online ones. In North America Walmart is very successful yet sells everything you can think of, including groceries...they simply overwhelm the competition with price while buying at low prices for various reasons. I imagine Woolworth could do the same. In the online world it is difficult to have a general mall type store because you have to rank for different keywords...unless someone is looking for an "online mall" to shop in. In my experience you are better of concentrating on specifics since keywords and keyword phrases and being found in searches is so instrumental to success.
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  • Profile picture of the author Platinum Matt
    Great post Dave, I've always thought that about Woolies... Never understood exactly WHAT they do.

    Made some good money last year though on them, glad I sold when I did.
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  • Profile picture of the author Diana Lane
    If asked what Woolies did, I'd probably have said they were a training ground for a very inept private investigations agency. I stopped going in there a few years ago after getting fed up with being tailed around the place by extremely unsubtle shop assistants whenever I went in, who seemed to believe that my only reason for being there was to pinch something (I've clearly got a very dodgy face!).

    Whenever I looked round, there'd be one not far behind, hurriedly pretending to stack shelves or risking a peek at me around the end of the aisle. The last time I went in there, I gave one the slip and doubled back on her. She was most surprised to find me behind her, and her entire expression said 'I've been rumbled'! I gave her my least dodgiest smile and have not been back there since.

    If there's a lesson in the current state of Woolies, I'd suggest that it might be 'Cutting back on dedicated security staff expenditure is never a good thing!' I expect there'll be just as many ex-Woolies staff looking for openings with MI5 as there will be looking for openings in retail
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    • Profile picture of the author Frank Donovan
      Dave

      I'm sure there are several reasons, some of which are directly related to the growth of the internet.

      For instance, throughout the 1980s and for much of the 1990s, Woolworth's were the largest UK retailer of music and videos. So they've suffered more than most from the technology changes in the world of home entertainment.

      Other specialist retailers have gnawed away at other Woolies core lines, such as children's clothing and toys.

      The comparison with Wal Mart is a little unfair. Most of Woolworth's stores are located in prime high street positions, with correspondingly high occupation costs. Wal Mart tend to focus on large out-of-town complexes which are much cheaper to run.

      As the original "five and dime" store, Woolies were stuck with a reputation which made it almost impossible to re-invent their brand.

      And you need to sell an awful lot of cheap merchandise to cover the ever increasing rents and other overheads.



      Frank
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      • Profile picture of the author Dave Fowler
        I actually worked for a few years for the distribution company that supplied Woolies, and when you've seen the hundreds of containers that come in every day, stuffed with products that they've obviously paid pennies for, and yet they cannot make a profit.

        I think you're right Frank,the World has moved on, and the likes of Amazon have been proved right, despite their losses for the first few years. You cannot afford to supply high street stores with this sort of merchandise. It doesn't make any economic sense. The physical distribution costs take their toll, plus, as you say, the rents etc they have to pay for their presence on the high street.

        This, surely, has to be good news for us as Internet marketers. We can promote items that cut out a very large chunk of the distribution costs and still make a profit... until the next seismic change!

        Dave
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        • Profile picture of the author ExRat
          Hi,

          I'm with Frank & Dave - the internet.

          And also out of town superstores that move quickly and stock anything that can be sold for a profit to their target/existing customers.

          Dinosaurs like Woolies will become extinct unless they evolve.

          Example - I popped into Comet to see if they could help me with a DVD/CD cleaning disk. £13 in a nice sealed plastic package.

          I came home and bought one off ebay for less than £3, works OK and was delivered within a day or two. The plastic package was a little less glamorous and easier to get into than the other one probably would have been - but I can live without the £10 packaging

          Admittedly, Comet compete on price on the big stuff and try to tuck you up on the small stuff. But even that practice will probably die out soon enough once enough people follow the path that I did.
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          Roger Davis
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  • Profile picture of the author Andrew McNaught
    i just never saw any point in going into woolworths anymore. for bargain stuff they are trumped by the pound stores and for anything else well there is always much nicer shops to go into. woolworths just seemed like a big mishmash.
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  • Profile picture of the author JayXtreme
    If we're honest though...

    Woolies has been on it's arse for years... The only reason they stayed around for so long was because when the kids were stealing the Pick 'n' Mix, their mum's would run in to drag them out and get caught by the cheap tat scattered around..



    Peace

    Jay
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    Bare Murkage.........

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