Hugh Mackay once stated “Erosion is more effective than explosion”. It makes so much sense, rarely is any behaviour or attitude converted instantaneously. Changes in behaviours happen gradually, people need time to trust the validity of new occurrences, simply put – they take time to adjust.

So picture this scenario: A ladies clothing retailer has opened in a busy section of town. The lady operating this business feels as though she has crossed all her t’s and dotted her i’s before taking on this business venture. Understandably, she wants and believes her business will succeed. Owning her own store is a long held dream of hers, and from day one she has built the store into one of the neighbourhoods most enviable boutiques.

Then interest rates go up. And fuel isn’t getting any cheaper. It doesn’t happen straight away, but slowly and surely sales figures start to drop. Our retailer notices that ladies are still browsing, however all of those ‘impulse buys’, which made up the majority of her sales, are becoming a thing
of the past.

Seeing her business sliding, our retailer decides to be proactive. She analyses her business and starts making adjustments. She cuts her staff, decides her plans for a new Point of Sale system can be put on hold, and starts to hold weekly sales in an effort to boost sales. Times are tough, but she
battles through.

Sometime later things are looking up. The news reports stabilising consumer confidence and a higher degree of business sentiment. People are returning to the shops, so our retailer gets rid of the 50% off signs, orders a new load of lovely, expensive clothing and readies herself for times like ‘the good old days’. The problem is though our retailer is ready to get things back to the way they once were for her business, the customers are hardly beating a path back to her shop.

So what happened? If economic conditions are returning to previous levels, why aren’t the customers back too?

Our retailer has made a serious error in her approach to coping with an economic downturn. Her actions during this time – cutting staff, halting store upgrades, continuous sales – has literally eroded the consumer’s trust in her business, and her customers are now asking “If the retailer could offer 2 for 1 or 50% off sales a few months ago, why am I paying top price now?” It’s a slap in the face to her once loyal customers, and they show their discontent by staying away.

One of the issues here (because there are many!) is though the retailer is champing at the bit to return her business to its pre-downturn glory, but consumers take longer to adjust. The retailer has eroded the value of her business, and damaged her business reputation at the same time. These sorts of issues take time to resolve, they can’t be fixed with an ‘explosion’.

At Jack in the box we offer advice and guidance to businesses who have lived this unfortunate experience as well as clients who have witnessed its occurrence and (naturally) don’t want it to happen to their business. Our strategy department excels in combining years of practical and analytical experience to resolve retailing issues before they happen. Using techniques to maximise business operations whilst increasing consumer loyalty is our speciality, and we take great pride in the
successes of our clients.

If you would like to be counted as one of Jack in the box’s success stories, come have a chat to us. After all – we are here to serve!