Innovative Retailer – Sue Ryder

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Brought to you by Retail Insider and PCMS Group

The Name: Sue Ryder

The Place: 455 charity shops all over the country

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The Story: If I say to you “charity shop” what’s the first word that comes into your head?

Musty: Right, how about “donations”?

Waterfalls. What?

Those weird pictures of waterfalls they always have. Or highland cows: Okay. Now how about “Sue Ryder”?

Dolls houses. Whoa, where did that come from? No, it’s brilliant. Or you could have said ukuleles. Because both of these things will be available in many Sue Ryder shops.

Phew. I’m not going funny in the head then: Not at all. Merely observant. And it is Sue Ryder’s business model of charity retailing that we are interested in today.

Huzza. A good news story. Have you spoken to the lovely Sue? No, but we did locate Katy Faulkner, head of retail operations and development. And I’d like to start with…

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Ukeleles. You’ve got to love a shop which decides to specialise in banjos haven’t you? Yes but no, we shall commence by noting that Sue Ryder shops have the largest turnover in the UK charity sector of new goods.

As opposed to the cow pictures: Yes, to qualify as a charity shop you must be selling less than 20% of turnover as new – Sue Ryder sells around 10% from a wide range of homewares including bedding, cushions and…

Ukeleles: Please stop this. I was going to say pillows. But yes, as you mention it musical instruments and dolls houses are really a range they have made their own. Reason being they want to offer the customer an extra reason to visit the shop and purchase.  And soon Sue Ryder will be able to tell exactly who is buying what and why.

How so? New IT is being rolled out quicker than you can say George Formby.

Who? Oh, never mind. And they will then be able to see how good the cross-selling between new and used is and so on.

It all sounds very business intelligence led for a charity shop. Next you’ll be telling me they segment the stores. Ha! They segment the stores.

Blimey: Store managers are trained up for this – when they open the bag in Walthamstow, they don’t only think “what could I get for this” they also think “and is there another shop where I could get more money”. If someone donates a designer dress for example it will probably make its way pronto to the nearest urban concept store where return is higher than a suburban high street unit. But what Sue Ryder has discovered is that people will definitely not pay more for stuff from, for example, Primark, Per Una or Sainsbury and Asda – whether they live in Chelsea or Peckham. Everyone knows what that costs.

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It’s all a bit organised for a charity shop: Certainly is. There is a real effort to balance movement of goods with costs of logistics with stock moved around most where there is a cluster of stores. However, customer differentiation is paramount too. For example in North Norfolk the customer base is tourist-focused so the shops are well supplied with books, toys, games – things the visitors require in their holiday homes.

But how do the customers know which one to go to? All units are given a write up and description on the website so that you know which one specialises in designer or vintage, or is a large 5,000 square feet store in a retail park only dealing in furniture, or features only new goods.

Or ukuleles: Sigh. The goal is obviously zero waste for donations but according to Faulkner this is the joy of charity retailing, store managers have a large degree of autonomy, they know the donors and will re-merchandise the shops every couple of days meaning that the through-put is astonishingly fast.

Banish the thought of musty stuff held for years in cardboard boxes: Absolutely. That’s so last century. But if something really is unsellable then Sue Ryder will gain the last penny out of it by pulping books or exporting the textiles. But that’s only after they have exhausted the online possibilities of course.

And what are they? Well, on their own online store they sell the new stuff. On Amazon they also sell the new goods. And there is an eBay site involving both new and donated (i.e. vintage) goods. They are very keen on growing this opportunity because as Faulkner points out, there is only so much growth in the high Street stores where Sue Ryder has to compete with all the other retailers.

I thought they paid no rent or something like that: Not quite, the rent is the same but business rates are less for charity shops. But finding the right unit is just as tough for a charity shop – no customers equals no point. That’s why they are trialling stalls at festivals, and vintage clothing fairs for example. Just putting the proposition in front of new people in as novel ways as possible.

Stop it now: No really, they have so many ideas on this. For instance, the store in Doncaster is now a budget brand store – everything at the shop is £2 – and the company is experimenting with fixed pricing at certain locations.

Wait, can I actually get a ukulele for £2: No. You cannot.

PCMS is a global provider of IT software and services for the retail industry. PCMS offers a full-range of integrated commerce solutions across selling touch points and also provides turnkey managed services and cloud hosting. Its client list includes John Lewis, Marks & Spencer, Waitrose, Whole Foods, as well as Walgreens in the US and fashion brands including Prada and Ferragamo across Europe.