Majestic Wine, one of the largest national chains of wine specialist retailers in the UK, has made a shock announcement this morning. They were bought by Naked Wines in 2015 in a move that saved the bricks and mortar retailer’s business, and incoming chief Rowan Gormley (founder of Naked Wines) has been widely praised for turning the business around and back to profitability. This morning they have announced that they will be closing a handful of sites and rebranding the entire business Naked Wines.
It’s come as a shock to investors, the wine industry, and a heck of a lot of its staff. But in the current climate of the high street, is it really that surprising?
Landlords still raise rents like they think it’s 2005. The UK government’s refusal to address the draconic issue of business rates is crippling high street business. The consumer coming into drinking age is the first completely computer literate generation the world has seen and generation-amazon-dot-com’s first stop for those looking for a bargain is their phones or tablets, not pounding the streets.
For some reason when I read this news I thought of the discerning DIY’ers first stop, Screwfix. Bit random I know, but bear with me here…
…a business that prides itself on the specialism of their staff, the choice of the product range, and the loyalty of its customers. Now look how it’s coped with the changing technological world. Smaller stores, click and collect model, but keeping the three afore mentioned sources of company pride.
Naked Wines continues to go from strength to strength online, with an expected 10-15% growth in 2019 alone. It’s Business 101 to use your strength to gear yourself up for the future.
A shock it might be this morning. But it appears to be perfectly sensible strategy.
Just a thought.