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Boutique is best in 2015

3 mins read

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3 mins read

Boutique is best in 2015

We have come a long way since Adam Smith gave us the principle of division of labour. What was fine in revolutionary 18th century Britain doesn’t quite wash today. When the demand was for high productivity and uniform quality, splitting every function into its component parts and employing specialists to do each job faster and better than normal humans could achieve, made sense. Now people want more: they don’t want uniform, they want unique, because that becomes their USP.

Manufacturers the world over have a dilemma. Do they manufacture centrally where they can control quality but are miles away from the market and have to absorb shipping costs and grapple with import regulations; or locally, where they can react more quickly to customers’ needs but costs are higher and quality more difficult to control? If your customers say they are all happy to have the same product, a central approach probably makes sense; if they want variety, it’s got to be flexible and it’s got to be local.

We have seen the same principle at work in retail. Buy something from Amazon and you will immediately be offered a range of additional products that you might like and which, by some remarkable magic, actually do rather appeal. Clever stuff! They have worked out how to have a process-driven business, but make it seem personal too. A winning formula.

But generally people do not like to be processed. Nobody likes to be a number. People like their services tailored to their own needs and large businesses try very hard to make it look and feel as though every customer is unique. Sadly, being able to follow a customer relationship management system alone isn’t usually enough to create a real feeling of belonging with customers. Until Alan Turing’s dream of truly intelligent computers that are indistinguishable from humans becomes a reality, large businesses will always be seen to be processing customers and hackles will always be raised every time the two come together. There is little alternative it seems.

Or perhaps there is. Maybe we are wrong to assume that big businesses will always swallow up the smaller ones and become bigger still. Perhaps the buying public will, sometime soon, come to the conclusion that they are prepared to pay for ‘real’ personal service and have had enough of being dealt with by automatons (human or otherwise). Maybe the return of the boutique supplier is with us.

Small businesses are collectively the UK’s largest employer. In my experience it is largely these smaller, specialist companies who really can treat people properly: assess their individual needs; spend the time to adapt products and services to fit; provide guidance and training that is appropriate to their level of competency; invest in clients so they can really understand their business aims and help to achieve them; and be there to put things right, quickly, without fuss, should something go wrong. And as customers increasingly demand greater individuality, better personal service from people who know them, and more flexibility from their suppliers, the need for that level of involvement will only grow.

In our business, for example, we have never been able to provide a truly standard product. Warehouse management systems all fundamentally do the same thing but every one is different, every customer wants something unique and every one evolves over time. Customers like that cannot be processed, they have to be partnered.

Adam Smith was right in 1776 when he famously said that it should take 15 people to make a pin. By doing so he was able to demonstrate that each worker could make 240 pins in the time it would take a cottage industry worker to make one. The problem was, and still is, that the pins all come out the same. If that’s what you want, fine; if not, a more 21st century approach is required.

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