When going with the crowd can achieve great things…

Alone we can do so little, together we can do so much

Helen Keller

There is much to be said for independent businesses right now, but it can be a lonely place when greater forces are at play.

The internet is supposed to have empowered the ‘little guys’ – the independent retailers, distributors and manufacturers – to go toe-to-toe with the corporates and win. The theory being that the independents are more agile, can provide a more personal touch and are better positioned to exploit a niche in the marketplace. In many ways this is true – but in others the corporates have a huge advantage.

One such area is buying power. But it needn’t always be so.

JMCL have just started work to help a group of businesses work to provide them with the ‘Power of the Crowd’.

The Challenge for the Individuals

The common thread to this group of retailers and manufacturers is the product they sell. A fitness product, sales have risen dramatically during the pandemic – but the shift to online selling has led to significant increases in their delivery costs.

In the online world price and delivery experience is vitally important. Consumers are shopping around and they want their product delivering when and where it suits them. In this context, the independent business is at the mercy of the couriers – they are both price and service ‘takers’. The individual businesses have very little leverage to negotiate with suppliers.

The product that the businesses transport is an awkward size and shape of package – a challenge JMCL have dealt with before with skis and snow-boards. An announcement that a major courier group would no longer carry this product brought their challenges into sharp focus.

The couriers hold the power – the manufacturers and retailers need to ship product and the courier is busy enough already. They certainly don’t need the work, so they can price for the inconvenience and the retailers / manufacturers have to take it.

The Power of the Crowd

JMCL recognised the challenge immediately through our work with clients in the sector. We approached the industry’s representative body and have started work to enable the businesses in the sector to work together.

There is a relationship challenge for the sector as a whole – but by working with both customers and suppliers it will be possible to get past many of the issues.

Our work will be aimed at helping the businesses to work together to enhance their buying power. The solution will help them to achieve both cost reduction and service improvement by consolidating their spend.

By also working with suppliers JMCL will also be able to change perception of the packages being a ‘nuisance’. With greater economies of scale coming from the consolidated spend, it becomes worthwhile for the ‘preferred supplier’ to invest in better ways of dealing with the packages.

Ultimately everybody wins. The end consumer gets a better service too.