Storewars chairman reveals keys to business success
MANILA – Citing his experience working with some of the world’s top retailers and manufacturers, the chairman of the business management simulation company Storewars shared what he believes are two keys to a successful venture.
During his recent visit to Manila, Storewars chairman Greg Thain said the most important element in any business regardless of its category is not resources, marketing or even innovation.
He said what businesses should have – but usually lack – is teamwork among its leaders and staff.
“It’s very case-specific. But in general, I think the first thing is you have to work as a team,” Thain told ABS-CBNnews.com.
“I think the number one thing that we always try to promote is that you have to work as a team – your marketing, your sales, your finance management, your production, your factory, all have to be in the same direction working together,” he added.
Thain stressed the importance of a strong team as it is now easier to start a business, citing the power of the Internet.
With plenty of competitors, a business built on a weak foundation can easily crumble, he said.
“With Internet now, we face more and more competitors because now it’s easy for somebody to launch an online retail business. The cost has disappeared. It’s computer power now – connecting to the Internet now is very easy. So it’s very easy for competitors to come along,” he said.
The second important thing to consider, Thain said, is building a business identity. The Storewars chairman observed how some businesses are too focused on following trends that their brands “get lost” in the process.
“I think it’s very important to understand your own brands and your own existing position before you worry too much about the market. Understand your own business first and then start worrying about where the market is going, or is the consumer changing,” he explained.
How Storewars works
Developed 18 years ago, Storewars has trained 20,000 executives from companies specializing in fast-moving consumer goods (FMCGs) such as Coca-Cola, Mars, Wrigley and Kraft Foods.
Unlike the usual business training which involves a lot of exams and lectures, Storewars lets participants “see the other side,” said Thain.
“You are divided into teams and you normally do something different from your day-to-day job. You see the other side,” he explained. “You see the perspective of the industry you’re on. So if you’re a retailer, you get to be a manufacturer, and vice versa.”
Thain then explained what Filipinos can expect from a Storewars business simulation program, which will be held on February 19 to 21, 2014 at the Shangri-La hotel in Makati.
“You are actually running the business. You make all the decisions to run a $500-million business. So you’re a team of five or six people, effectively the board or the management group, you run a very serious business and you’re either manufacturing a brand or deciding the purpose of every brand. Because brands should all be different, You have a major brand which is a market leader making lots of profit, and you have the niche brands which just gain from one segment, and you have brands which you use, frankly, to attack the competitors. We need to make all those decisions.
“You look at the data in the market and understand where the market is going, if you should change your company because the market is changing all the time. If you’re a retailer, you can look at all the brands on the shelf. Because shoppers come to a store because they can buy the brands they want to buy,” he said.
Trends in PH retail landscape
Thain, who visited the Philippines for the first time early this week, then shared some of his first impressions about the country’s retail landscape.
“I spent the whole day yesterday going around here, looking at retail. I was actually pleasantly surprised. I think the development of retail is good here in the Philippines. I think the stores are, in general, well laid out,” he said.
He said, however, that certain FMCG categories still have room for improvement. “You have quite a few categories that are in cans, which have eventually progressed to frozen [goods] in many countries. There’s a shortage of frozen vegetables, and items like that,” he said.
Thain also noticed the "tingi" or piecemeal mentality, citing the popularity of products in sachets and other smaller packaging.
“In the non-food, I think the detergent sector is interesting. There seems to be the small sachets all bundled together, that’s an interesting phenomenon. I think that’s a phenomenon you’ll move away from soon, as the most countries have,” he said.
Another sign that the Philippines is a bit behind compared to its neighbors is the dominance of powdered juice drinks, which Thain said was popular in countries like Russia 20 years ago.
“But I think there’s lots and lots of opportunity. My impression was positive,” he said.