Thursday, May 3, 2012
The Apprentice- week 7- Can you smell what sells?...
This week’s task took Lord Sugar down memory lane..this is how he started his empire which is quite unbelievable! The teams replicated Sugar’s first business venture. They were sent to a wholesale warehouse with 150 pounds, they had to choose stock to sell on two location. The idea was to smell what sells! During the day, they had to restock through re-investing their takings in which ever products they saw sold best. Hopefully they delivered the best margin as well. Team Sterling with Nick as PM, had a clear strategy and plan from the get go. Very organized, they decided very quickly on products they felt would suit the public in Essex, they also chose items to be sold in the market- house hold products and items to be sold in the shopping mall- beauty products. ( For example fake tan and nail rapes). Phoenix under Jade, operated in complete chaos! Decision making was slow...no strategy what so ever- a word that would come back to haunt Jade... They spent so much time on finding the right location that they had just a few minutes to select the products. Jade wanted a big verity so it ended up being a random mix of items. She decided to split the items 50-50 between the market and the mall. Even though Azhar kept telling her they should send more items to the market and that they should decide which items are fitting which location, he was simply ignored even ridiculed. For Sterling, chosing specific items also matching the location they were at, proved good and sales went well. The fake tan was their best seller! Nick decided quickly to re stock, since it was raining at the market it was empty so Stephan&Ricky were sent to the warehouse. Nick made two crucial mistakes: 1. Their household stock remained in the van instead of being first dropped off at the mall for the team to sell. 2. They were quite far from the warehouse, Nick’s team members were much closer. This resulted in the team having a void period with nothing to sell for close to two hours! Ricky&Stephan were stuck in traffic.. They did identify their best seller so it was said- “Bring back as much tan as you can”. They re stocked three times doing their sums, selling with a high margin. Jade didn't pay enough attention to the price the items can actually be sold for and worst yet, she kept cutting prices which were low to begin with.. Lord Sugar was clear- the winner will be the team with the most assets! Meaning its cash profit and whole prices on items left therefore, cutting prices in that way made no business sense! Because it was a random mix of items, it was very hard to shift the goods. The sale’s team had to go from one item to the other when they have nothing in comment, some not fitting the public and foot traffic there leading to Jade's dropping price to 50%. They restocked three times as well but they missed the point big time- each time,the PM decided to restock on all items! The idea was to smell what sold best and restock that item. Again, she ignored the team suggesting to buy only their best sellers. The end result was that team was left with 7 items, the same amount they started with...Sterling had only two items... Adam did redeem himself a bit this week, he utilized his market sales abilities well. He felt right at home selling really well however, he too missed the mark. He doesn’t understand why one needs a proper strategy, pricing and he didn’t see that the flogging approach made no sense in this case. He made fun of these issues proving he should remain in the market, he will not be partners with Lord sugar well, I cant see that happening... also because he isn't open to learning anything new. You can take the boy out of the market but you can’t take the market out of the boy... Not having a strategy proved a big mistake for Phoenix, and combined with a much too broad assortment and a flogging mentality, it cost them the task- what a shock... Sterling won- 955 pounds profit, 117 pounds more then Phoenix. They did not slash their prices, they priced right from the get go and stuck to that. They sold the fake tan for example for 10 pounds a bottle, Jade’s team sold it for 2.99 pounds a bottle... In the board room, Jade gave a good fight and sold herself better then Azhar. Even though the loss was truly down to her bad management and lack of business skills, Azhar didn’t fight his corner hard enough and it cost him, he was fired. Lord Sugar said he decided to fire him because the team ignored him and didn’t take his opinions on board. This was true however, he at least knew what he was doing business wise. I don’t agree with his decision this week, do you? Feel free to share and add your views&comments on this episode below. Have a great weekend! www.fromadifferentangle.com
Labels: #wholesale #sales #promoting #business #fromadifferentangle #theapprentice #marketing #strategy #product