After price and product availability, customer service is the next most important priority for retailers when shopping in cash and carries, whether it is “fast and friendly” or “knowledgeable and helpful”.
And the good news is that retailers’ satisfaction ratings for speed of service have improved over three years while staff helpfulness ratings have consistently been high. It is interesting to also note that retailers’ ratings for “acceptable price” ratings improve when service ratings improve – the two are inextricably linked.
So if there is a direct association between service and value, what more can be done to improve the service retailers receive – to improve value and price impressions? We see it in retail – we now see the direct link in wholesaling.
Thirty per cent of retailers do not feel valued by their cash and carry chain – showing there is still plenty of room to improve.
We suggest breaking down the working week into smaller components to see where the opportunities lie. Retailers’ ratings for product availability are only 6.6/10 first thing in the morning (between 8am and 9am) compared to 7.3/10 in the afternoons suggesting some branches are not “ready for customers” during the first few hours of trading. As a result, retailers find it harder to find products (only 7.5/10 rating). It is also interesting to note that speed of service ratings are lower between 8am and 9am (7.3/10) and lo and behold, retailers’ acceptable price ratings are at their lowest pre 9am compared to virtually all other times of the day, when the price is exactly the same all day long.
This goes to prove yet again the direct link between service and price. Get the service right, and price impressions will improve.
But it also suggests cash and carry operators need to review their early morning service offer and product availability – remember that 75% of retailers are visiting a cash and carry to “top-up” and so anything to make their visit as quick and painless as possible will be approved.
Why, for example, do retailers have to register before entering the branch? Why can’t they just walk in and start shopping? Are key sellers always easily visible and accessible? Often they’re not. Forty four per cent of retailers would like to order products via the internet and then collect the products a few hours later.
Finally, retailers’ experience in cash and carries also changes through the week. The earlier in the week, the better the service, but product availability is worse. Later in the week, service deteriorates but availability gets better. The challenge for the industry is to iron out these peaks and troughs, to develop more consistent product and service offering at all times of the week, and focus on service to improve the industry’s price image. Twenty per cent of independent retailers source products from supermarkets, mainly due to price, but then convenience (location, nearness, time). Virtually none named “service” as a reason for shopping in supermarkets. Service really can be a differentiator.