Last Jack-In-The-Box Standing

“There is much to be learned, about the future of retail, from the high street toy shop The Entertainer.”

Over the last few months I have written a lot about the demise of the UK high street. As its importance as a shopping destination has declined several of my blog subjects have become market leaders by default. As their competitors have fallen by the wayside they have found themselves stranded, alone on the high street, wondering where their customers had gone – HMV, the Game Group and Mothercare come immediately to mind. Well, of course, the punters have gone online and out of town, so it’s great to find a contrarian retailer, that has also become the last man standing on the high street, in its market space, but rather than fading away is doing rather well. I wonder why?

Sales at The Entertainer, the independent national toy shop chain, have risen 11.9% across its 69 shops in the first three months of 2012. This when things are normally quiet and all of Santa’s elves are busily making toys for the busiest toy shopping period of the year, when something like 60% of sales take place. Toy shops are very seasonal places, in more ways than one.

After thirty years of trading The Entertainer, with its recognisable jack-in-the-box logo, has recently been embracing a new phase of growth, adding new stores in Jersey and Grimsby, the first of 10 planned for the year. It is also revamping its web presence, where sales grew some 89%, year on year, in the first quarter. All this after the toy retail market declined a little last year.

Gary Grant, who owns the business, says that he has been lucky and just as he wanted to take the business to the next level a number of things helped it out. The disappearance of Woolworths, which had 14% of the retail toy market, helped as did the end of The Early Learning Centre and Hawkins Bazaar. This has allowed him to hire experienced managers who were put out of work with these closures. On top of that, retail rents are going down, due to the contraction in the retail “bricks” base.

Well, I tend to agree with Gary that he has been lucky and that probably includes his relatively modest scale and low average transaction price.  If the business had been a lot bigger and set in its ways it might not have been able to adapt to the fundamental retail transformation that is going on around it. He is right to pump £1.5m into the website and to get the bricks/clicks balance right for this sector.

Gary is also lucky because, unlike buying music or gaming software, it is much easier to make a toy shop a fun if not magical place and compelling to visit. If anyone wants proof of that they should visit a branch of The Games Workshop, which sells modern war-gaming paraphernalia at a premium and creates a wonderful retail experience for its target clients. I think one of the reasons The Entertainer is doing so well in these difficult times, is that it is making its shops exciting places to visit too.  It puts a lot of effort into making the shopping experience fun and in the selection and motivation of its front-of-house staff.

The Entertainer is still standing because it understands the future of retail better than most and that, when there is an option not to, people will have to have a damn good reason to visit a shop. Then to get them to do more than use it to make a decision about what to buy more cheaply on line requires a great deal of skill. Early days, but I think Gary has a big opportunity here and that The Entertainer may well be in the Game Workshop mould of retailers that will be here long after many other shops close on the high street.

I think we will find that shops need to be “destinations” in their own right to really prosper on the high street of the future.

Mark

 

 

 

 

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