How a shoe specialist rebooted itself in lockdown

Founded in 1860, Gardiners has maintained a largely traditional approach to the distribution of footwear and workwear brands to the retail trade.

In recent years the firm has developed an innovative e-commerce service. But four-fifths of its revenue continued to come from delivering goods to retailers’ shops or distribution centres.

That changed dramatically in March 2020. From sales and buying teams to the warehouse and tech specialists, every part of the Gardiners business has had to change its focus swiftly in response to the market disruption wrought by the pandemic.

The Gloucester-based business is now on course to achieve turnover for 2020 roughly equal to 2019 figures, according to CEO James Gardiner.

That’s 10 to 15% down on pre-lockdown growth targets. But it represents a huge achievement in the context of plummeting sales in the early stages of lockdown.

Abrupt decline

Gardiners’ online model offers brands ‘virtual distribution’ through e-commerce, including its own business-to-consumer websites, with products sent direct from its warehouses to consumers.

In the first phase of lockdown, this element of the business performed reasonably well. However, that was eclipsed by the abrupt decline of Gardiner’s traditional wholesale model: its revenue dropped by 80% in April 2020.

While competitors furloughed employees, Gardiner’s top team monitored the situation in daily virtual board meetings – and held its nerve.

“By calmly listening before making decisions, and holding off kneejerk reactions, you come to a far better medium-term view,” says James. “We were able to do that because of our financial strength, which gave us the ability to deal with fluctuations.

“HSBC were exceptionally supportive right from the start, really taking the time to discuss different scenarios and potential solutions.”

The business took advantage of a three-year business interruption loan, enabling it to manage cashflow despite an unexpected load of unsold stock.

Shifts in practice

Over the weeks that followed, a gradual acceleration in online sales vindicated the board’s decision to avoid furloughing staff.

Several omni-channel retailers began to see the value of Gardiners’ virtual distribution model in the lockdown environment. New agreements were signed with both retailers and brands.

Gardiners’ sales team pivoted from traditional sales to persuading and explaining the online service to potential clients. And tech employees had to work fast to carry out web integrations with these new partners.

Buying practices changed too. “Rather than buying as a wholesaler, our buyers had to think through the eyes of a retailer, since we were now seeing demand driven directly from consumers,” James explains.

“It was also important to manage relationships with suppliers, because we had to delay orders for brands that were not doing well online, and request faster stock for high-performing brands.

“Meanwhile, the warehouse teams had to pick and individually pack items for dispatch to consumers – again, a very different process from traditional wholesale.”

Relationships maintained

Foreseeing the eventual return of traditional retail sales, Gardiners was careful not to neglect those clients.

“We have quite a big field-based sales force,” James says. “Some people thought we were crazy, but we placed a high value on having that team continue to communicate with their customers and maintain our intelligence about the market.

“That’s worked very well: we’ve maintained relationships while most competitors did not.”

While the warehouse team operated split shifts and introduced extensive safety measures, the remainder of the firm’s 150 staff worked from home. That this proved effective was a revelation for the business, which had previously offered only minimal remote working outside its Gloucester offices.

“It’s highly likely that we’ll be much more flexible with office work in future,” James says. “And it’s great to have a bigger talent pool beyond those who can travel to the office – for example, we’re looking further afield in our current recruitment exercise for online staff.”

Online growth

Gardiners’ resilience and innovation were rewarded with a predicted growth of around £10m in its online services, double the 2019 turnover for that element of the business.

“We do expect the bricks-and-mortar side of the business to recover to a large degree, but there will be fewer customers in future,” James says. “However, we’re anticipating that our online range extension and business-to-consumer offering will continue to grow fast.

“Overall our experience shows how quickly you can achieve things you previously saw as impossible, when the need arises.”