Modus non-executive director Barry Dass has had a successful career across the fashion, corporate and professional services sectors. Barry was formerly managing director of Sterling Cooper and several other brands including Milla and Prophecy. He is currently Head of Strategy and International Development at Davenport Solicitors and CEO of UK Advisory Services.
We spoke to Barry about how software and data analytics have transformed how fashion retail and manufacturing businesses are run and how small and medium-sized retailers can use them to gain an edge. He also talked about how he has been able to transfer his knowledge and experience of running businesses in the fashion sector to the professional services sector.
How did you acquire and use data in the retail and manufacturing sectors in the pre-computer and internet era?
In those days, one of the biggest challenges was having the data and information to hand to help us make the right decisions. This would be simple things in manufacturing, such as the amount of raw materials we needed or what was in stock.
You’d also want to know which stock was selling quickly and why certain clients were not selling as well as others. This involved a lot of work as we had to put people on the ground to meet the clients and find out the information we needed.
How did the emergence of computer software change things?
It wasn’t until after I implemented the first software for accounting and stock keeping that life became so much easier for us. We had the sort of information we had never had before. Things became much clearer and more streamlined. This was the first time I understood that the way forward had to involve technology.
On the retail side, we implemented an EPOS system. That was a game changer as it provided us with so much information in terms of which items were selling in which shops and in which geographical regions. It helped us then distribute our merchandise into these areas at the right time and much faster.
We were also able to minimise our stock holding because we would produce exactly the ratios of sizes and colours that were selling well. This increased our profitability and gave us an edge over many of our competitors.
What are the challenges today’s retailers face, especially SME retailers?
The challenge for a lot of them is that they understand the basics of data, but they don’t know what to do with it. I find that people become pretty much drowned in data and have become a little weary because there is so much of it. Half the time, they have no idea what the data means. It’s not about having the data but what you do with it now you have it.
One of the most important things for retailers is to know what their customers and customer segments want. This is what successful retailers do. You start with what your biggest problem is and use the data to help solve it. There are a myriad of ways that analytics can do this including loyalty schemes, analysis of customer buying history, managing returns, and use of external data to find out, for example, what certain customer segments are buying (for instance from social media tracking).
There’s been talk in the press about ‘video analytics’ and how smart cameras can tell retailers about their customers’ buying habits. Some of the technology available at the moment is incredible and getting more sophisticated. But some of it is simpler and available at much less cost such as heatmaps that can tell you the numbers coming into a shop and where they go, which can be picked up by a simple mobile phone sensor.
As ever with analytics, success comes from both the data you obtain and the human interpretation of the data and what it tells you.
How can retailers and manufacturers get the most out of data analytics?
The first thing is to understand the issues and challenges they have. In our business, we had distributors throughout Europe, America and the Middle East. We had something like 300 items and many different sizes and colours. The challenge was to try to make sure we provided each distributor with the right merchandise for them to sell to their clients.
How did we do this? The distributors sent us sales information and our system would generate within minutes details of exactly what was being sold right then. We made sure we were ordering stock that was actually being sold by the distributor. Before this, what you would do is place an order for products with a manufacturer based on speculation. By having this software, we were able to eliminate speculative purchases.
Predictive analytics eliminates one of the biggest risks of retailers and manufacturers, which is speculating. It allows retailers to manage stock much better in terms of what inventory to buy, and when. I think even with retailers today and the predictive analytics tools available many are still speculating.
How can SME retailers compete with the bigger chains and online retailers?
Much is being made of how high street retail is dead, but good retailers thrive. These are the ones that know what their customers want and use analytics to help with all parts of their business. For example, Primark, one of the most successful retailers, doesn’t have an e-commerce website. And Amazon, the king of online shopping, is opening bricks and mortar outlets in the UK.
For SME retailers to be competitive, they’ve got to act fast. Retail has always been a business that changes rapidly. You’ve got to make the right decision in terms of what stock you buy. The larger retailers have to buy much further ahead than the smaller ones because of the production timelines. This means they speculate far ahead.
But smaller and medium-sized retailers have a competitive edge as they can buy more cleverly. They can use data analytics to give them precise indications of the best and worst sellers.
They need to be nimble and use analytics to exploit their advantage.
Do you think the industry has been slow to adopt data analytics?
In the old days, I remember how as retailers we’d say we’re going to sell more black coats than brown ones and we’d speculate and buy products well ahead of time based on what we did historically. I remember with my dad he used to manufacture fur coats a year ahead and hold them for a whole year as he knew when winter came, they would sell like hot cakes. That’s all gone.
When we designed a collection, we were inspired by what the fashion houses were telling us were going to be the next big trends for next season. Based on that our designers would put together patterns and colours. If you think about it, this is speculation founded on somebody somewhere saying next year psychedelics, say, are going to be big because we’ve got new age movement coming in, or whatever. It’s all about personal feelings and it’s all creativity.
But when you come down to your business and your profitability, it’s a completely different game. You cannot let simple things like your personal feelings or perhaps a concept you believe in to be the judge of what you should or shouldn’t be selling.
At the end of the day, it has got to be based on facts and what the people who are coming into the shops are buying. There’s so much dead stock sitting on rails because someone just made a decision based on what somebody told them would be the next best trend in fashion.
Technology has given us the ability to harvest information and it is up to us to decide what we are going to do with it and how to use it to our advantage. Some people who do things in the old-fashioned way are very clever and understand their clients and use their judgment to do well. But sometimes they get it wrong.
Then there are others who have no idea and will go into a buying spree for their shops for the next season without any information and just let their heart drive their decisions. This is where technology and data analytics can help people understand exactly what they should be investing in. You’ve got to be able to use data to identify changing patterns sooner rather than later.
Turning now to your role at Davenport Solicitors, is data playing a part with what you are doing there?
It is playing a part. We’re using it mostly for SEO and marketing and giving us an idea who is coming onto our website and where they are coming from. This helps us identify who our marketing is attracting and if we are marketing ourselves in the right way. For example, we’re looking to engage with businesses and corporates mainly but if we have more individuals coming onto the website looking for employment or immigration assistance then perhaps our website content is appealing to them more than the corporates. So, we need to make changes to that to look at how we can engage with the corporates.
How have you been able to move so seamlessly from the fashion sector to professional services?
If people ask me how you go from a product industry (fashion) to a service industry (law and HR), I say it’s simple. The mechanics of any business are exactly the same.
The first thing I did when I came into Davenport Solicitors was to create a product out of the services we were providing. We were doing employment and immigration law. We now offer packages, different levels of service for different clients. The client simply understands what they’re getting for what they’re paying and what their requirements are.
We offer you our bronze HR support package, say, which will give you XYZ and cost you this much per month for 12 months. So, you create a product out of a legal service. It’s untraditional for law firms to provide fixed fee monthly retainer packages but we managed to do it because we are a small flexible company. A lot of the larger companies struggle to do that now and are trying to do fixed fee packages but it’s harder because of the infrastructure they have in place.
So, what I’ve done is use the same business mindset and brought it into a different industry.