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Who Will Win The Race For Choice And Convenience?

Crystal Direct Group UK HQ in Letchworth

Kevin Morgan, commercial director at Crystal-Direct, talks about the challenges affecting the the home improvement industry and the benefits of managed drop-shipping.

For a while now (although a relatively small amount of time in terms of retail and online change), it seems to me like DIY and Home retailers have a clear choice between launching a marketplace of their own or following the managed dropship (DSV) route with leading software companies such as Virtualstock.

I’ve said previously the last three years have been a difficult time for many UK companies and manufacturers, and it’s been no different for Crystal-Direct. This tough commercial environment is continuing now with the economy being railroaded by soaring inflation, interest rates, and energy hikes - so businesses have to keep evolving and adapting. The biggest change for us during this time is that we are now a genuine omni-channel business, building upon years of B2B and DSV experience with the trade and retailers such as B&Q, we have developed solutions for a raft of customer facing brands wanting enrich and grow their own inventory via these online platforms.

The move or integration of DSV for some companies is a ‘hot potato’ in that the reduced margins create a nervousness with the traditional retailers who are used to 30-40% margin aspirations. Having been close to this rapid move to expand choice and range online, it never ceases to amaze me that some companies still don’t get it. In my view it’s essential to leverage dropship as an additional sales channel in an increasingly competitive market. Expanding your customer offer via DSV not only gives the customer more choice, but it is also actually very low risk for the retailer without compromising their existing logistical infrastructure. In fact by the time, you factor in the costs that are not applicable, the DSV option provides a much better margin return!

Availability is crucial, so working with forward thinking brands such as Screwfix, Toolstation, Travis Perkins, and others who use Virtualstock, I have witnessed first-hand the incremental growth this delivers. It’s interesting – but no surprise – to read recently that Robert Dyas and many others are moving towards this retail ‘no-brainer’. Crystal-Direct has always been proud to manufacture what it sells, as well as delivering the products ourselves via our own fleet of tracked vehicles. In short, this means good availability and fast lead times. This is particularly convenient when sourcing heavy and fragile products such as windows and doors, eliminating the need for the retailer / customer to transport or create unnecessary touchpoints – we do it for you all end-to-end; you might say the perfect DSV supplier!

We won’t rest on our laurels though, this is just the beginning.  We will continue to invest and develop our products and services and we will work with new and existing partners. In fact, we are currently onboarding with two household brands as well as an existing customer to develop energy efficient ranges with lower U values and triple glazing.

In summary – it's time to get off the fence, retailers… If you are sat there believing your existing range will suffice, watch out and think again… If you stand still you are actually going backwards...

Source : Kevin Morgan, Commercial Director at Crystal-Direct

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30 September 2023

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