Running faster to stand still

Food retail is a fiercely competitive business that demands consistent execution of numerous complex processes in order to get the right product in the right place at the right time, at the right price. It is also very people-intensive, requiring excellent soft management skills. The growth of new channels, notably premium/natural, limited range discount and online, is starting to put even more pressure on mainstream operators' profit margins. The normal response is to accelerate existing cost-cutting, store renovation and organisational change programs.

The problem with this approach is that it prevents companies from testing or even thinking about new ways of responding to the changing market place. Managers are so tied up with the immediate demands of ensuring the basics continue to run smoothly, while attempting to implement the latest new initiative, that they simply have no time to prepare for the future. The result is an industry that is increasingly playing catch up with itself and its customers. 

Now is the time to think about how to get off the treadmill, and to reconsider a self-service model of grocery retailing that is nearly a hundred years old. This will require vision, bravery and greater appetite for risk. However, running faster just to stay still may be the riskiest strategy of all. 

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