Chime School

Posts Tagged ‘recession’

The economic crisis is like a bewildered Godzilla, tearing through downtown New York, tearing down all but the most secure of fixtures.The UK has seen the fall of some pretty big and well established retailers such as Woolworths and MFI in recent months. Now its the turn for diamond and pearl jewellery retailer Diamonds & Pearls. The Bedford-based company announced recently that they have gone into administration. Many of their 91 retail shops in the UK could be faced with closing, threatening more than three hundred jobs.Global accountancy and management consultancy firm KPMG have been named as administrators. Myles Halley, and Richard Philpott, the administrators appointed by KPMG Restructuring, said they plan on selling up the business and are looking for a buyer.  They also hinted strongly that many branches would be closed, leading to “a number of redundancies”.

So another one bites the dust and joins the growing list of recession casualties in 2009. But it wasn’t long ago that Diamonds & Pearls descibed themselves as “one of the UK’s fastest growing fashion retailers”. So what exactly went wrong? Does this mean it’s set in stone that if you’re one of the smaller players in the retail industry, you will not survive? Well I would say no. While Diamonds & Pearls’ physical stores may have been doing well in recent years, a quick look at their website, http://www.diamondspearls.co.uk – and you’ll quickly see the problem. Aside from being a pretty poorly designed site, when you click on “Online Shop” you get the message “Our Online Shop is currently under development, Please call back soon”! Well I never! End of mystery, to my mind. There’s no doubt in my mind that Diamond & Pearls suffered because they completely failed to complement their stores with a web presence. The one defining feature of consumer behaviour in the credit crunch is that people are going online to find the cheapest prices. It’s especially fundamental for small to medium retailers to take care of this. If you are not at least holding your own in the online world, and relying purely on traditional methods of retail, its simply become a question of how long before you go bust, not whether you do. Even retail giants such as MFI, Woolworths and most recently Principles have suffered greatly. One of the key failings of all these retailers was that they didn’t have a strategy for online sales and marketing at a time when their competitors were staying afloat by these means. If I was looking for information on saltwater pearls, or browsing for freshwater pearl jewellery for a Mother’s Day gift, the first thing I’d do is search for those things. So would millions of others, and they wouldn’t find Diamonds & Pearls in the search results. If you run a retail business, take note, or you could end up in the same state as them.