Effective Retail Rollouts
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How to best manage a retail program through the design and rollout phases.

How to best manage a retail program through the design and rollout phases.
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Effective Retail Rollouts Document Transcript

  • 1. Effective Retail RolloutsHow to best manage a retail program throughthe design and rollout phasesWhite paper | March 2011
  • 2. Shikatani Lacroix is a leading branding and design firm located inToronto, Canada. The company commissions assignments from allaround the world, across CPG, retail and service industries, helpingclients achieve success within their operating markets. It does this byenabling its clients’ brands to better connect with their consumersthrough a variety of core services including corporate identity andcommunication, brand experience design, packaging, naming andproduct design.About the AuthorKevin BongardFormer Account Director at Shikatani LacroixKevin obtained a Bachelor of Architectural Science, specializing inProject Management, at Ryerson Polytechnic University. He alsoattended Wilfred Laurier University, studying Business and Film.Kevin has received a number of awards including the HanscombAward and a Scholarship Fund from Ryerson, as well as the mosthighly regarded honour in the interior design community – twoARIDO Awards of Excellence for Retail Spaces, in 2005.Prior to joining the Shikatani Lacroix team in 2008, Kevin had theopportunity to work as a project manager on a wide variety ofcorporate, commercial and residential projects such as condodevelopments, specialty retail, corporate offices, and concept,prototypes and rollout management for clients such as TrumpInternational, Minto Sky, Royal Ontario Museum, Virgin Mobile, TheBeer Store and Blacks. At SL, Kevin managed the rollout of 30Apple and Speedy Glass stores in Canada and 20 CoxCommunications stores across the U.S. Kevin is now a projectmanagement consultant for retail design and construction.White paper | March 2011 | Effective Retail Rollouts | 1
  • 3. The Retail RolloutIn today’s retail landscape, there is a tremendous presence of largebrands that have a significant number of locations spread out overlarge geographic areas. The process for achieving this type of retailfootprint is known simply as a retail rollout.Successful rollout programs operate like a well-oiled machine, relyingon its own system of processes that ensure its success. This reportwill discuss these complex processes in context and articulate howimportant it is that they are part of a larger awareness initiative.Defining the Retail LandscapeBackgroundIn the past, residents in cities would have had some of thebasics available to them within reasonable walking distance –e.g., the local convenience store, barber, restaurant, coffeeshop – however these facilities were usually one-off locationsowned and operated by a local merchant.In the 1950s, when suburban communities became trendydue to improvements in transportation, zoning laws, andother economic conditions, commercial malls became widelypopular to satisfy consumers’ needs. These malls would bestrategically located to service a large geographical footprint.It became increasingly common for ‘local’ retailers to considerexpanding their presence in the marketplace by creating multiplelocations. This would give them an opportunity to capitalize on whatworked at one location (e.g., good products, customer service) andleverage this in another. This also gave retailers a larger forum tocommunicate their values and overall essence to the customer –helping to expand and reinforce their brand presence.White paper | March 2011 | Effective Retail Rollouts | 2
  • 4. In order to compete in this marketplace, the most successful retailerswere able to maintain consumer loyalty by replicating a consistentand positive customer experience, while at the same timemaximizing profitability by streamlining their processes (e.g., supplychain, corporate structure, economies of scale).Evolving lifestyleAs urban centres continue to expand, and newcommunities form where there were oncefarmers’ fields, there is an increasing demandfor convenient services and amenities.Increases in population, environmentalchallenges, and finite land have contributed toa paradigm shift; it is no longer practical orfeasible for large chunks of land to be zoned ascommercial or residential. Also, not allresidents, with their increasingly busy dual-income schedules, are satisfied with commuting long distances to goto work or do their shopping.This trend has lead to mixed-use communities where people are ableto live, work, shop and play – all within minutes of their house. It hasalso generated what we have come to know as the Lifestyle Centre.These commercial centres have grown in popularity over the lastdecade or so, virtually replacing the indoor mall as we know it, andpopping up on almost every corner of the suburban landscape.Inspired by the efficiencies of malls, but with the architectural andcity planning merits of a main street (some centres have adoptedparking in rear and a more pedestrian friendly streetscape), LifestyleCentres have come to define the modern shopping experience.White paper | March 2011 | Effective Retail Rollouts | 3
  • 5. Other branded public spacesFurther to expanding urban centres, schools, transit stations, themeparks and museums are all examples of public spaces that are alsoserviced by retail brand chains. The first Apple store in Paris openedat the Louvre to much fanfare. In the absence of new indoor malldevelopments, these public spaces have come to define the retaillandscape; instead of forcing you to go to the mall, they bring themall to you.Future lifestylesAs the above-mentioned formats are still working to definethemselves, it is not exactly clear what the future will hold for theretail shopping experience.Of course, there is always the increasing popularity of online ormobile shopping. While this is certainly an increasing trend,customer’s still like the experience of shopping, and holding theproduct in their hands.Perhaps the future lies somewhere in between?The creators of I-Marketplace certainly seem to think so, with theirconcept of a morphing, interactive shopping centre. The winners ofthe ICSC (International Council of Shopping Centers) top award haveconceived of a retail environment that surrounds public transit, andis made up of kiosks, which move throughout the space based onthe time-sensitive needs of the patrons. These stores are alsointeractive with mobile devices, making the shopping experienceconvenient and relevant to consumers’ evolving lifestyle.White paper | March 2011 | Effective Retail Rollouts | 4
  • 6. Understanding the Retail LandscapeIn this dynamic environment, retailers continue to be faced withmany challenges when making decisions as to how best to representtheir brand, and successfully access and grow their customer base.They must compete with other retailers who have a strong presencewith multiple locations.Variables such as construction costs and rising rent will have a largeimpact on the initial cost, as well as the ongoing costs, of a rolloutendeavour. Similarly – depending on the range of products andservices that are offered – there could be substantial investment intraining and staffing.With an increased awareness of environmental issues, retailers largeand small are starting to evaluate their philosophies and the public’sperception of their brand by taking more responsibility for theiractions. LEED certified design and construction have been a growingreality that increasingly need to be considered and addressed.The retailers that will succeed are the ones that organize theircompanies in a way that satisfies the current needs of this retaillandscape, while incorporating flexibility into their corporatestructure to adjust to the ebbs and flows of this ever-changingenvironment.To put it in perspective, the ‘local merchant’ mentioned at thebeginning of this paper is having a much more difficult timesurviving in this retail landscape. It is becoming harder for the localhardware store to compete with the Home Depot down the street.As a result, the effective implementation of rollouts has becomemore complex and challenging.White paper | March 2011 | Effective Retail Rollouts | 5“With anincreasedawareness ofenvironmentalissues, retailerslarge and smallare starting toevaluate theirphilosophies andthe public’sperception oftheir brand bytaking moreresponsibility fortheir actions”
  • 7. Servicing the Retail LandscapeShared goalsWhen assessing how to service the retail landscape, you can break itdown into two major categories:1. The Retailer servicing their consumer/general public2. Consultants, vendors, sub-vendors, employees servicing theretailer (and customers)However, category #2 is really a sub-set of category #1 becauseeveryone should ultimately be working towards the same goal, weare all on the same team!In this fluctuating economy, the most successful participants in thisindustry will be the ones who understand their contribution withinthis larger context. Everything they do should be geared towards theoverall success of the greater group; anything short of that will becounter-productive and will ultimately lead to failure in some way.This applies to all levels of the operation – from the CEO of a retailcompany, right down to the cleaning crew doing their final cleanbefore a store launch.White paper | March 2011 | Effective Retail Rollouts | 6
  • 8. People and processesLooking at this landscape, it is fair to say that achieving success inthis complex marketplace is not a simple task; there are manymoving parts, and it is not something that can be approached in ahaphazard way.As mentioned earlier, organizations must align themselves in astrategic way so that they can assess, process, and satisfy theconsumers’ changing and growing needs.In the end, this will likely come down to two things: people andprocesses.As any successful organization understands, their primary goal is toalign themselves with the right people – people who understand theorganization’s needs and share their drive in achieving the samegoals. Of course, this applies not only to employees within theorganization, but also to outside consultants and vendors. They relyon these external vendors to apply the same philosophy as theirinternal employees.So how does a company guarantee they align themselves with theright people? And once this company obtains the right people, howdo they ensure they are all working towards the same goals – andachieving them?At this point processes come into play. Similar to the philosophy of‘finding good people,’ the idea of having effective processes is notunknown; most businesses small and large devote a tremendousamount of time, money and resources to the development ofprocesses and company standards that will help them achieve theirgoals. However, many do not.White paper | March 2011 | Effective Retail Rollouts | 7“Align yourselfwith the rightpeople – peoplewho understandyour company’sneeds and shareyour drive inachieving thesame goals”
  • 9. If logic prevails then it would make sense that those who haveeffectively created and implemented successful processes, and whohave aligned themselves with people and companies that do thesame, are more likely to benefit from efficiencies and avoid costlymistakes down the road.Building brands: Designing, Constructing andManaging a Retail RolloutA retail rollout program should embody all of the elements that arementioned above. To understand why, we will try to break down theprocess into three notable parts:1. Client Identity and Strategy2. Prototype Development3. RolloutClient Identity and StrategyThe retailer: product and brandA successful rollout should start and end with the retailer.In retail there is always a product that is being sold. Whether it iscoffee or cellular phones, the product will have an impact oneverything from the target market and geographical locations of thestores, to the marketing strategy and product displays.With the right people, the retailer should also be able to successfullyestablish their brand identity (e.g., vision, mission, position), and theneffectively communicate their brand essence consistently to theirpeople, partners and consumers across numerous markets. This willultimately inform the overall design of the retail store along withother supporting elements like the signage and graphics that areused to communicate the brand.White paper | March 2011 | Effective Retail Rollouts | 8
  • 10. Market strategyGiven the many options available to the retailer, they must determinea strategy for entering or expanding into the marketplace. Thisincludes basics such as identifying a target market, researching thecompetition, and understanding the demand for your product.The market strategy will significantly help to decide which locationsthey select, as it will have an impact on:• store format (size, shape, height)• store type (lifestyle centre, mall, kiosk)• geographic location (target market, competition)• quantity of store locations/speed of rollout (demand)Corporate synergyMost retailers that are involved in rollouts are multi-departmental corporations. All of these departments arevery busy with different responsibilities and initiatives forthe company.A retail rollout initiative is not limited to the ConstructionDepartment of a corporation – particularly at the initialplanning stages. Rather, this endeavour will require thecommitment of many people within the organization. Thiscould include the following key areas:• Design/Construction• Real Estate/Development• Marketing• Retail/Operations• Information technology• Security• Purchasing• MaintenanceWhite paper | March 2011 | Effective Retail Rollouts | 9
  • 11. All of these departments would need to be sufficiently staffed sothat the appropriate amount of time can be allocated to resourcesthat contribute to this initiative in the most productive manner.When done properly, team members are motivated to accomplishcommon goals, which will lead to the overall synergy of the team.Identify core competencies/outsourcingSince no company is capable of doing absolutely everything, it isessential that every company have a realistic understanding of theircore competencies. This involves identifying the following:1. What is the retailer currently capable of doing in-house?2. What is feasible and practical for the retailer to add in-house(either now or in the future)?3. What services and capabilities does the retailer need tooutsource?There are many variables that inform the decisions listed above, asthere are pros and cons to all scenarios. Ultimately, it will come downto the best way to address a few key criteria. Here is a quicksummary:White paper | March 2011 | Effective Retail Rollouts | 10
  • 12. Criteria Internal vs. ExternalQuality Control There is generally better control over resourceswhen it is internalized, however those resourcesmay be limited in terms of the skills available tocomplete the task. You can leverage a larger‘talent pool’ when outsourcing. There is the riskof losing control by relying on others. You mustenforce a clear and strong emphasis onexpectations and standards.CostEfficienciesInternal is efficient if the task is a commonly usedinternal core competency, as you don’t have topay towards profit of another company. If not, itmay be better to leverage another company thatspecializes in the task and might be able to offerbetter economies of scale. Outsourcing alsoallows a company to obtain competitive pricingfrom multiple vendors.Innovation Having access to the right external resources willbring more interesting ideas to the table, and willalways push innovation.Diversity andFlexibilitySimilar to ‘Innovation,’ outsourcing offers a widerrange of diversity and flexibility of resources.Different vendors can be used for different tasksat different times, therefore expanding thebreadth of services that can be offered.Resources can be used as required in order toaccommodate fluctuations in work load.Responsiveness Outsourcing can assist in leveling the workloadand improving responsiveness, however, it oftenrequires an additional layer of communicationand review, which could cause a bottleneck.External sources must uphold standards.Implementation Sometimes a skill or service can be implementedinternally as a core competency by simply hiringone resource. Other times, it might require acomplex network of resources and experiencethat could take years to acquire. In the case ofthe latter, it might be best to outsource. A taskcan be internalized over the right amount of time– if desired.White paper | March 2011 | Effective Retail Rollouts | 11
  • 13. As you can see, it really comes down to your core competencies andworkflow. Outsourcing can be very appealing and rewarding fortasks that don’t fit into your primary service offering.The manner in which it is handled will have an impact on thecomposition of the project team, and ultimately, the execution of therollout in general. When done successfully, the team will beoptimized in all areas listed above and is most likely to achieve thecollective goals of the project. This will also set up lines ofcommunication and responsibility, to be discussed later in this paper.Selecting external consultants and vendorsEarlier, we made reference to processes that can be used to helpchoose the right people. Typically, this is done formally by using acompetitive process such as a Request For Proposal (RFP) or bid.This allows different firms to compete based on a set of pre-established criteria, which is generally a combination of experience,expertise and price.When approaching vendors, it is important to clearly articulate asmuch information as you can about the specific needs and goals ofthe project so they have an opportunity to address this in theirproposal and present an explanation as to how they are aligned.On the practical side, this will also help to identify and isolate thescope of services that you require – maximizing efficiencies byensuring there are no gaps or overlaps in services. This will minimizecosts to you, the client, as lack of clarity typically leads to addedexpense; vendors tend to be more conservative in their pricing tocover themselves for any potential scope creep or unknowns.White paper | March 2011 | Effective Retail Rollouts | 12
  • 14. Prototype DesignOnce the retailer is clear on the direction that they want to take, andhas the right people at the table, they are now ready to create aprototype design for their retail store.When done successfully, the designwill seek to embody all aspects ofthe client’s identity and marketstrategy, and give the retailer theopportunity to present it all in aphysical form – a retail store.There will be many ways to achievethis end goal, as well as manycompromises along the way.The right project team will be able tolisten and work very effectively withthe retailer to understand who theyare, what are their priorities, andprovide guidance to help them withthe tough decisions that willultimately lead them to the bestrepresentation of their brand.Moreover, a retail rollout process is something that growsexponentially in scale, magnitude and complexity from the outset;failure to do something properly the first time around will take muchmore time and resources to resolve later on.White paper | March 2011 | Effective Retail Rollouts | 13
  • 15. ResearchIf the retailer has already established their brand identity, and hasconducted all of the necessary research, they will need to providethis information in a comprehensive format to the designer.Alternately, the design firm may participate in the gathering of thisinformation.The designer will then conduct extensive research to understand thisinformation in the context of what is currently out in themarketplace. The goal will be to truly grasp what separates theretailer from the competition, and how will this be represented in thedesign of their stores, to uncover what will differentiate their storesfrom their competitors’.Store formatsSince rollouts can often cover a wide range of markets with differentgeographical and socioeconomic attributes, a retailer needs topackage and tier their store design (and potentially their productoffering) accordingly. A common way to tier stores is to categorizethem into A, B and C store formats.For example, some locations or markets may cater to an extremelyaffluent clientele (an ‘A’ market), with a long list of name brandspresented in high-end store environments. A retailer may choose toput a store into this area – as long as they feel that they can becompetitive. In such cases, they would need to implement their Astore solution for the following reasons:White paper | March 2011 | Effective Retail Rollouts | 14“The goal will beto truly graspwhat separatesthe retailer fromthe competition,and how will thisbe represented inthe design of theirstores, to uncoverwhat willdifferentiate theirstores from theircompetitors’”
  • 16. 1. They want to appeal to the target market/demographic of theshopping centre.2. They need to be on a level playing field with their competition.3. The shopping centre itself will usually have restrictions in theirtenant design criteria to ensure that these standards aremaintained.On the flip side, implementing an ‘A’ store in a ‘C’ market could be aproblem for the following reasons:1. This could alienate the target market, which might get theimpression that the retailer’s products are out of its price range.2. It would likely be an over-allocation of funds (constructioncosts), based on projected sales and return on investment.Landlord/city criteriaDifferent landlords and jurisdictions may have unique design criteriaand requirements. This should be factored into the rollout process, asit means that there will always be exceptions to the standard design.This could impact anything from the finishes in the store to the sizeand shape of the exterior signage.Design standards should incorporate flexibility so that these uniquerequirements can be addressed in a timely fashion. For example,exterior signage should be set up so that it can be presented in astacked or horizontal format. There should also be a variety ofsolutions in terms of internal illumination (e.g., face-lit, halo-lit).Alternate finishes should be pre-selected so that, for example, alaminate can be replaced with a stone or solid surface, or carpet canbe replaced with tile.White paper | March 2011 | Effective Retail Rollouts | 15
  • 17. Always think aheadDuring the prototype stage, consider that everything will bemultiplied throughout the lifecycle of the rollout. For instance, a $3per square foot difference on a porcelain tile, when installed in 1,000square feet per location and multiplied over 100 locations, can makea $300,000 difference to the retailer’s bottom line.Furthermore, any changes to the design that come later on in arollout process can significantly increase studio time for drawingrevisions, engineering costs, construction costs, and so on. This cancause confusion and delays when using the multiplication factor.Standardization and modularity vs. customizationA key aspect to the design of a prototype is the development of allof the design components. These are sometimes called the ‘kit ofparts’ and create the building blocks for the store design.The prototype – by its very nature – is being designed for efficiency.It should be understood that future locations may vary drastically insize and shape from the original prototype layout, and as such,thought must be given to how modular, customized and/orstandardized the design will be, and how easily it will apply toalternate layouts. Not only will this have an impact on the applicationof the store design itself, it will also significantly affect the cost ofthe fixturing – as mass producing standard fixtures will costsignificantly less than fabricating custom fixtures.White paper | March 2011 | Effective Retail Rollouts | 16“A $3 per squarefoot difference ona porcelain tile,when installed in1,000 square feetper location andmultiplied over100 locations, canmake a $300,000difference tothe retailer’sbottom line”
  • 18. Every element has to be looked at as a puzzle piece and evaluated interms of how important it is to the design, as it has the potential tobe limiting in the future. For example, if one fixture has to be 15 feetlong – and six of them are required in each location – then this maybe a relatively large puzzle piece. It could put additional pressure onthe Real Estate department to select locations that satisfy theseneeds. This is not necessarily a bad thing, it just needs to beunderstood so that a conscious and practical decision is made.Look and feelThe purpose of this stage is to create the most exciting andinnovative design concept for the retailer. Once all of the best andmost talented people have been brought to the table, design studioswill employ different methods of capturing information – from theclient and internally – to ensure all good ideas are considered andthe best ones are implemented. This can involve different versions ofbrainstorming.A brilliant design concept is useless unless it can be communicatedeffectively to the client in order to gain alignment, and to ultimatelyproceed to the next stage of development.For example, if the client does not have the capabilities to fullyvisualize the space, they may need more information like renderingsor other tools (even a model, if necessary) to ‘see it.’ On the flip side,if the client has visual capabilities (perhaps they work in a creativefield), it may be appropriate to scale down the deliverablesaccordingly (e.g., plans, elevations, sample boards). This way theclient is getting the best possible value for the design firm’s services.White paper | March 2011 | Effective Retail Rollouts | 17
  • 19. Efficiently and effectively achieving alignment with the retailer willhelp to ensure the following:• The design concept is consistent with the client’s understanding oftheir brand and strategy. This would ensure all appropriatestakeholders are participants in this process in the correctcapacity.• The client’s expectations are properly managed and unpleasant‘surprises’ are avoided.• The client will avoid costly and timely revisions that can put asignificant wrench in the process.MockupsDuring the prototype phase, it can be very helpful to create mockupsof the most common fixtures and key elements. This can range fromthe mockup of an important fixture, or the construction of acomplete retail store location (sometimes in a warehouse).By doing this, the team has an opportunity to play around withfixtures and simulate the shopping experience before final approvalsand mass production. Modifications can then be made to theprototype to ensure that it is satisfactory.It is very likely that the cost and time allocated to this task will payoff in dividends later on.White paper | March 2011 | Effective Retail Rollouts | 18
  • 20. ApprovalsAs mentioned earlier, the rollout program may have very aggressivetimelines. In this case, it is in the client’s best interest that they arefully informed of timing requirements for all of their approvals. Whilethis may seem awkward at times, it is another example of how thewhole team needs to be working towards the same goals.As an example, if the designer sends something to the client on aMonday, and it needs approval by Wednesday in order for it to beimplemented by the Friday deadline, the designer needs to informthe client of this requirement. If they don’t, they may not hear backfrom the client until Thursday, at which point they would inform theclient that it’s too late and they can’t meet the Friday deadline.Through this process, the client is empowered to help ensure theproject proceeds in an expedient fashion – in the right direction –and the deadlines are met.The designer can work with the client on the development of anapproval process that works with their needs. Some approval itemsmay require a full face-to-face presentation, whereas other itemsmay be communicated via email. It may be presented to all keystakeholders or to a selected group.When determining this, it’s often best to look at it as simply aspossible: “what could possibly derail this project after this approval?”If the answer is: “we didn’t understand what the designer wascommunicating,” than a face-to-face presentation and discussionmight be necessary.White paper | March 2011 | Effective Retail Rollouts | 19“Through theapproval process,the client isempowered tohelp ensure theproject proceedsin an expedientfashion – in theright direction –and the deadlinesare met”
  • 21. If the answer is that a specific person reviewed it after the meetingand “didn’t like it,” that person should be on the approval committee.By clarifying everything ahead of time, many disruptions andmiscommunications can be avoided.RolloutOnce the prototype has been effectively set up, everyone is ready toenter into the ‘rollout’ phase. This is when the locations come fastand furious.To ensure the team is properly set up for the rollout, here are a fewthings that should be in place before they begin.Establish a communication planOnce all of the key players are brought on board, it is very importantto establish a communication plan which essentially identifies thelines of communication between all of the parties involved.Failure to establish a communication plan can result in manyproblems, including the following:• Overall lack of clarity.• Inbox overload; without clear lines of communication, people areforced to ‘reply all’ and enter into huge email forums for each task.• False direction, errors and omissions.• Unnecessary work overload/inefficiencies, slow response times,delayed approval processes – all of these can lead to schedulingand cost overruns.White paper | March 2011 | Effective Retail Rollouts | 20
  • 22. Quality management processDue to the inherent complexities of a retail rollout process, there aremany things that can fall through the cracks.With aggressive timelines, project teams are often inclined tojumpstart the project and move as quickly as possible. While speedis an important asset, it is more important that you are headingquickly in the right direction.Taking a moment to establish a quality management process at theoutset of the project – whereby the various stages of the rollout areironed out – will help to ensure things run smoothly, and will helpavoid mistakes, cost overruns and schedule delays.Generally, it will outline processes for the following key items:Design process• Fact-Finding• Schematic Design• Design Development• Consultant Coordination• Contract/Permit/Construction DocumentationPermits/approvals• Building Permit• Landlord ApprovalWhite paper | March 2011 | Effective Retail Rollouts | 21
  • 23. Coordination of vendors (e.g., millwork, exteriorsignage, interior graphics, security)• Drawing Coordination• Shop Drawings/Artwork• Approvals (Designer, Client, Landlord, City – as applicable)• Fabrication/Printing• Delivery and InstallationConstruction• Pre-Construction Meetings• Site coordination/reviews/reports• Supplementary Instructions• Deficiency/Punch Lists• HandoverThe more these processes are thought out and resolved in relation tothe specific project and client needs, the smoother the execution ofthe project.White paper | March 2011 | Effective Retail Rollouts | 22
  • 24. Risk managementAs is the case with all business practices, a retail rollout will involve aconstant series of decisions. Each decision will ultimately contributetowards the success or failure of the endeavour. In order to helpensure that the right decisions are made, each potential scenarioneeds to be forecasted as much as possible, and assessed in termsof the associated risks and benefits. Typically, these decisions willeffect any combination of the following categories:1. Cost2. Schedule3. QualityThis process is something that happens naturally when any problemsolver approaches a decision. It is important to evaluate the risks andcompare them to the benefits.The process of risk management – much like many other projectmanagement processes – involves taking this information andorganizing it into a pragmatic, quantifiable and useable format.This allows key members of the project team to be one step aheadof any issue by anticipating potential risks and evaluating theimplications of different responses. This helps to ensure decisions aremade in the most appropriate, efficient and effective manner.White paper | March 2011 | Effective Retail Rollouts | 23“In order to helpensure that theright decisions aremade, eachpotential scenarioneeds to beforecasted asmuch as possible,and assessed interms of theassociated risksand benefits”
  • 25. SchedulingThe reality is that it takes a certain amount of time to do each taskproperly. Allocating the appropriate amount of time to each job thatneeds to be completed is something that requires a tremendousamount of conviction and tact. Retail launches, marketingcampaigns, projected revenue, lease payments and other factors arethe most likely to dictate the timelines, as stores are often openedindividually as part of a larger program.This presents a very challenging situation where the people involvedin the project (from client employees to external consultants,vendors and sub-vendors) are often asked to complete their work inless time. This puts each party at risk of producing work that issubstandard, which can lead to errors and omissions, or missing thedeadline altogether.Once again, it is the consultant’s obligation to create a projectschedule, download information from sub-consultants/vendors, andinform the client of the amount of time it takes to properly executethe work. Remembering that everyone should be working towardsthe same goal – failure to do this can expose the client to potentialrisks as noted above.By obtaining confirmation from everyone on their time schedule forcompleting their work, you are essentially getting their consensus(i.e., ‘buy-in’), and, as a result, can hold them accountable forcompleting their work on time.This will be fundamental to managing the retailer’s expectations andoffering them the best likelihood of success.White paper | March 2011 | Effective Retail Rollouts | 24
  • 26. Application of conceptOnce all of these processes and systems are in place, the next thingto do is apply the concept to multiple locations (execute the rollout).The following are two, seemingly contradictory, observationsregarding this stage:1. The more resolved your processes are, the more ‘automated’ therollout will become, and, as a result, the smoother it should go.2. Systems will never be perfect; the parameters of a rollout arealways changing and evolving, as do the needs. As a result, theproject will never entirely run itself.It is important to constantlymonitor the progress of therollout – challenge thedesign, processes, systemsand costs – and ensure thereis an ongoing optimizationof efforts and results. Thisongoing evaluation shouldbe executed at every level ofthe operation, again, fromtop management down tothe last sub-vendor.White paper | March 2011 | Effective Retail Rollouts | 25
  • 27. Value engineering and project optimizationDuring the prototype phase, the designers are balancing manyvariables at one time. First and foremost, they must establish thedesign identity (i.e., look, feel, materials, colours) of thestore. Due to time restraints, the designer doesn’t havethe opportunity to look at every possible option.Similarly, not all processes can be optimized from theget-go. It may be that the desired products are noteasily available (i.e., require long lead-time), or are onlyoffered through specific vendors.Value engineering is an organized process for reducingcosts while minimizing impact on overall performance.This process can also be looked at as part of a largerdesign optimization process, whereby all aspects of theproject are reviewed and improved upon. Processes arestreamlined and efficiencies are gained.It is to the benefit of the client that time is allocated tothese tasks during the rollout phase to ensure that thevalue is optimized in all areas. All key players shouldparticipate in an appropriate capacity.Here are some different examples of value engineering and designoptimization:White paper | March 2011 | Effective Retail Rollouts | 26
  • 28. 1. Unit cost: Initial product (e.g., carpet) selected during theprototype phase might be $5 per square feet. Later on in theproject, an equal alternate might be selected that costs $3.50per square feet. That’s a $1.50 savings on 2,000 square feet offlooring, which would be $3,000 in savings per store.2. Availability: The original product may be imported from Italyand have an eight-week lead-time. An alternate may be the sameproduct stocked locally, or an equal product that is offered by alocal vendor – both scenarios allowing them to turnover carpet intwo weeks.3. Single-source vendors: Looking at all of the finish specifications,there may be many different types of products (e.g., two typesof carpet, one vinyl flooring, two floor tiles, two wall tiles), allsupplied by different vendors and each with different lead times,invoicing, tracking, management and mark-ups. Major efficienciesand economies of scale can be passed on to the client if theseproducts are sourced from one single vendor.4. Purchase direct/warehouse: Over time, the client may also be ina position to purchase large quantities of products directly fromthe supplier, and have these products warehoused for future use.This will allow the client to save on bulk purchasing andpotentially avoid a mark-up all together.5. Quality: The team may determine that a product isn’t performingto the desired standard. This can mean that the product is highmaintenance or getting damaged, or maybe posing a threat tothe customers (e.g., slippery floor, sharp corners). Theseproducts should be identified and substituted over time toensure that quality is always being optimized.White paper | March 2011 | Effective Retail Rollouts | 27
  • 29. Status meetings and reportsA common method of sharing information and coordinating work isin the form of a status meeting (usually weekly or biweekly). Whenthese meetings are run poorly, they can be time consuming, costly(in consultant fees), and confusing. However, when run properly itcan be an effective organizational tool.The format often involves running through a project list and sharingupdates on the status of all key items. This information is thendocumented as ‘minutes’ or as a ‘status report’ by an administrator,and distributed as documentation and reference. This document isthen used as an agenda reference for the subsequent meeting.Formatting these documents is a science of its own – but a basicapproach would be to always think about how this information isbeing used. It should be perfectly clear what the issues are, and whois responsible for the solution.White paper | March 2011 | Effective Retail Rollouts | 28
  • 30. Info gathering and as-built surveysIt is always better to clarify information and identify issues early inthe process. On a project-specific basis, this means gettingeverything right at the outset before embarking on detailed layoutstudies and drawings. It is essential that the designer is working withaccurate information. The following is a list of critical information:1. Name and address2. Budget3. Client needs/program requirements4. Landlord contact information5. Base building drawings (i.e., architectural, mechanical, electrical,structural, civil)6. Landlord tenant criteriaIt is advisable to develop a standard checklist that can be completedby the client for each individual project. This form should becustomized for the particular retailer to ensure that it captures all ofthe key elements of their stores.Reliable as-built drawings or site surveys are required in order toensure that work is completed accurately. These drawings willindicate all clear dimensions, as well as existing systems (e.g., HVAC,structural) and obstructions (e.g., thermostats, wall grilles). Thisinformation is necessary in order to avoid drawing revisions andminimize site conditions, both of which can have a negative impacton timing. It can also allow you to save money by re-using existingelements (e.g., a rooftop AC unit, door hardware). For anysubstantial renovation project, investment in an accurate Site Surveywill be well worth the cost.White paper | March 2011 | Effective Retail Rollouts | 29
  • 31. Trends and dynamics impacting store rolloutsAggressive market penetrationAs the retail landscape continues to get more competitive, retailersare finding an increasing need to implement aggressive expansionand enter into more and more markets to keep up with competitors.This means fixed budgets may need to be stretched out over moreprojects, thus increasing the need for optimized efficiencies in orderto maintain an appropriate level of quality at each location.TechnologyIn order to keep a competitive edge, project teams – often spreadacross long distances – will always benefit from an awareness of thelatest technologies that help humanize and streamline the process.For example, the iPhone 4 is a mobile phone that has videoconferencing capabilities. This function could appear gimmicky at aglance but consider the possibilities when someone could have a‘face-to-face’ meeting with a client to discuss fees whileparticipating in a real-time tour of a site – in one video call.There are many other programs and systems that allow people toimprove the quality of their communication and services: videomeetings, computer sharing, Image Viewers, and central file sharingsystems – to name a few.Consider the impact that some web-based technologies could haveon project workflow, like Google which has implemented an enginecalled ‘Google Instant’ that anticipates and displays results as youtype. When you break it down, how many Google searches occur perday between all team members during the course of an averageproject rollout?White paper | March 2011 | Effective Retail Rollouts | 30“In order to keep acompetitive edge,project teams willalways benefitfrom an awarenessof the latesttechnologies thathelp humanize andstreamline therollout process”
  • 32. The increased role of applications for mobile devices (includingtablets such as iPad) allows people to do more things while they areon the road. These cover everything from GPS, references, photos,videos, and access to endless information. There are alsoproductivity tools like word processing, sketching, presentationsoftware and even a forthcoming mobile application for AutoCAD.Building Information Modeling (BIM)BIM is an evolving platform that is becoming a more commonstandard among design professionals. It uses a multi-facetedapproach to design, which enables the consultant team to design inunison in a three-dimensional, real-time, real-life environment.This allows users to incorporate building geometry, spatialrelationships, geographic information, and quantities and propertiesof building components to evaluate building design and systemsover the lifecycle of the structure.In effect, it allows the project team to create a virtual prototype of abuilding within a real life context. This enables the team to work in amore collaborative environment, where they can objectively evaluatethe building design and systems, and streamline the developmentprocess – from design through to construction.Understanding and leveraging productive advancements intechnology is a good way to stay ‘ahead of the curve.’ Failure to doso puts you behind.White paper | March 2011 | Effective Retail Rollouts | 31
  • 33. Ten best practices in retail rollouts1. Focus on unifying the team by identifying and leveragingcommon goals. Build a team that is knowledgeable, reliable,thorough and detailed. Monitor work and make adjustments toresources if necessary.2. Identify and understand your needs and place them into context.3. Determine what gives you, the retailer, a competitive edge overother retailers in your category and leverage this in your brandidentity.4. Champion and facilitate clear and open communicationthroughout the entire project team.5. Address problems as early as possible, as they reliably get worseas time passes.6. Constantly focus on refinements and improvements to theprocess and find ways to implement them.7. Ensure that all information is accurate at the outset of theproject, including all base building ‘as-built’ drawings.8. Reinforce a positive attitude and maintain a high level ofmotivation at all levels of the operation.9. Create unique, inspiring and exciting environments to representthe best aspects of your brand.10. Implement and enforce strong cost and scheduling systems tokeep things on track.White paper | March 2011 | Effective Retail Rollouts | 32
  • 34. One unified goalIn the end, everybody must be working towards the exact same goal.If anyone involved in this process is looking after their own interestsat the expense of the well being of the project as a whole, thenultimately this will stand as an obstacle.Quite often companies will agree to make significant sacrifices attheir own expense – and think that this is for the well being of theproject – when in fact it is accomplishing just the opposite. Considerthat two of the most consistent examples of this deal with two of themost important things in the project: time and money.When people agree to complete work too quickly, or for too littlecost, they create a situation and expectation that is not sustainable.This may work as a short-term solution, or it can be the ‘exception tothe rule,’ however rollouts are based on long-term solutions that willcontribute to the health of the endeavour over a long period of time.When it comes to money, a vendor may be inclined to charge toolittle for their work or services. While this may get them the initialcontract, it is not sustainable and will inevitably lead to one of thefollowing:• The vendor may have to cut corners to work within the costrestraints – leading to compromised quality and/or exposing theclient to unknown risk.• The vendor is not profitable and goes bankrupt, or the vendor hasto increase their fees. Either of these will mean the client isexposed to a higher expense, which could affect the whole ROImodel of the endeavour.White paper | March 2011 | Effective Retail Rollouts | 33
  • 35. Since time and cost restraints are a reality for retailers, the mostsuccessful participants of the project are the ones that constantlyrefine their processes and costs to be most efficient. This allowsthem to offer the best value to the retailer, without makingcompromises that are ultimately detrimental to the project team.ConclusionGiven the competitiveness of theretail landscape, retailers have a lotto consider in order for them tosucceed. This will permeate everyaspect of their business.The retail rollout is only one ofmany components that cancontribute to the success or failureof the retailer. This is why rolloutsneed to be understood in context –and fit within this context – toensure that it works.When done effectively, a retail rollout can create exciting interiorenvironments, communicate brand identity, and ultimately driveprofitability, not only for the retailer but also for all of those involved.White paper | March 2011 | Effective Retail Rollouts | 34
  • 36. For more information, contact:Jean-Pierre Lacroix, PresidentShikatani Lacroix387 Richmond Street EastToronto, OntarioM5A 1P6Telephone: 416-367-1999Email: jplacroix@sld.comWhite paper | March 2011 | Effective Retail Rollouts | 35