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How marginal gains can be just the therapy the retail industry needs

retail therapy

Julie Jones, Retail Business Development Manager at travel management company Clarity, looks at how making nudges in behaviour can reap big rewards for retailers. 

Retail and travel go hand in hand. Whether you’re a multinational high street name, or a local independent, chances are you will have to travel to source your products, keep on top of your supply chain and manage manufacturing. 

When looking at the associated costs of corporate travel, many businesses often write it off as a necessary evil - ‘We have to maintain this supplier relationship’, ‘We need to make a site visit to our factory in Asia' - and as such the cost of these visits is accepted, rarely challenged and potential changes in behaviour not considered. 

However, working with the principle of marginal gains, small changes can start to be made
over a period of time, revising attitudes to these trips and making savings along the way. Rather than accepting that several times a year there will be some very expensive long-haul flights, why not start to look at the booking behaviour to work out if any savings can be made? Simply booking in advance, can make a huge difference to fares. 

A great example of this was a client I’ve recently started working with. As a UK based retailer with stores worldwide, their travel spend was significant. The business wanted to make savings, so measures were required to reduce this spend, without impacting profits. After some analysis, we found that 74% of flights were booked within 7 days of travel, resulting in an increased fare. Working with the retailer we managed to nudge booker behaviour, encouraging advance bookings, until we delivered over £30,000 of savings. 

This is just one example of how changing behaviours, and in such a small way, can lead to
real, tangible results. The main challenge for retail environments is often process based - travellers being left to book and expense their travel, rather than using a centralised system. Not only does this put a huge strain on the finance department, there is such a disparity between the way employees book travel that trying to implement cost saving exercises becomes nearly impossible. 

So how do you start to change this?


One way is through the adoption of corporate travel technology. There are some great apps out there, which allow employees to book centrally, adhere to a travel policy and generally makes their lives (and the lives of procurement and finance) a whole lot easier. Whilst not everyone may have, or want to have a travel policy, certain parameters can be set up in the app giving business travellers flexibility, whilst helping to point them down a more cost-effective route. Another subtle, but effective, nudge. 

Naturally though, this all takes time - which when you need to make cuts and increase the bottom line isn’t always something which is available! Having said that, a retailer we recently worked with managed to achieve an 88% adoption rate of the new system within the first week of the new travel programme running. It’s all about making it as easy as possible for people and nudging them down the right path, showing the benefits to them throughout. With huge cumulative savings to be had, these nudges are absolutely worth it. 

The industry isn’t going to change overnight, and many of the travel needs specific to retail are going to remain. There are going to be last minute meetings in far flung destinations which require buyers to hop on last minute flights. There’s going to be firefighting at new store openings, meaning train journeys booked on the day of travel. These things are unavoidable. However, encouraging individuals to pay closer attention to the data, to book in advance, to use technology to work smarter, all these things can add up over time to make some significant savings, whilst having a minimal impact on business as usual. 

With the retail sector under constant scrutiny and almost seemingly daily new challenges, isn’t it time to start looking for the quick wins, the small changes which can minimise costs and help profitability? 



Planes, trains and marginal gains is now available to download here


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