Twenty years ago, the theory of disruptive innovation hit the world of business. It’s a misunderstood concept, and the grocery industry is one where the term ‘disruptor business’ is over-used.
There seems to be an air of drift around the trade at the moment - especially in the independent sector. There’s the potential impact of the national living wage, non-action on business rates and the potential removal of restrictions on Sunday trading. The historic five pillars of convenience - alcohol, tobacco, soft drinks, chilled and snacks/confectionery - are all wobbling.
The long-term decline in overall alcohol consumption continues to deliver consolidation in the market (though it is also opening up opportunities). Jamie Oliver’s campaign on sugar, meanwhile, feels like it might result in political intervention. Snacking is a key part of ‘the problem’ for salt campaigners, while tobacco - via tax, display restriction and packaging restrictions - is on the road to becoming a niche activity for retailers.
Before we all get our coats, there is still time. All retail and wholesale businesses will, at the moment, be the grateful beneficiaries of a largely unbudgeted windfall from much lower than expected fuel costs. That buys a little more time for chin stroking while flowing into the bottom line.
Not that chin stroking will be enough. I have, in recent months, seen many business ideas that have been presented as ‘disruptive’, but none have been. Their ‘disruptions’ are in essence tweaks to the traditional offer. What we need is disruption with a capital D: something that would cut a swathe through operators unable or unwilling to alter their model.
My Local’s Mike Greene has already shown an element of this thinking by not having a ‘bricks and mortar’ head office for My Local. We need more along those lines if independent retail is to thrive. One thing is certain - someone, somewhere will be working towards something that in future years we all look back on and think “why didn’t we spend the time working on something like that?”
Keith Webb is director of Aiden Associates and business advisor for Icon Business Solutions