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Bert Hoogeland, DIY in Europe, Netherlands, Managing editor of Mix
Suppliers of branded goods don’t have it easy. Here in the Dutch DIY business we have been acquainted with the phenomenon of cut-price goods for years already. For most DIY stores such products provide the add-on range at the bottom end of their assortment. But cut-price goods didn’t get their name for nothing: margins are low, and quality is not always “top”. A healthy margin is necessary for the health of a business, and quality results in satisfied customers as a rule. This is true both for trade and industry, though the latter does find itself backed into a corner at times. Of course, costs are keenly calculated in order to get onto the shelves. Where space is limited. So the need is for differentiation.
Not very much space is reserved for sector-specific products in Dutch DIY stores. This constitutes one of the dangers for the DIY retail trade in the Netherlands, in my opinion. Products foreign to the sector are a typical phenomenon in the market, like a red thread running through the entire retail landscape. Shops selling housewares also offer garden products, Aldi advertises binoculars plus clothing, and in the DIY stores there is a surprising choice of printer paper, DVD players and table football games – the latter definitely not only because of the World Cup!
The plus in the sales results of this sector in the Netherlands would be a minus without these goods. But must this of all segments supply the fuel for a sector? Not in my opinion. A segment foreign to the trade may well exercise a certain appeal, but only short-term and as a one-off. Once the customer is actually inside the DIY store he also tends to buy other products, which may very well have to do with home improvement. However, articles foreign to the trade should not appear as a visiting card on the front pages of the weekly advertising flyers. This results in the core business being lost from sight. Developing an image as the shopping centre for the DIYer would be for the good of the sector and definitely also good for the reputation of the DIY stores.
Suppliers of branded goods don’t have it easy. Here in the Dutch DIY business we have been acquainted with the phenomenon of cut-price goods for years already. For most DIY stores such products provide the add-on range at the bottom end of their assortment. But cut-price goods didn’t get their name for nothing: margins are low, and quality is not always “top”. A healthy margin is necessary for the health of a business, and quality results in satisfied customers as a rule. This is true both for trade and industry, though the latter does find itself backed into a corner at times. Of course, costs are keenly calculated in order to get onto the shelves. Where space is limited. So the need is for differentiation.
Not very much space is reserved for sector-specific products in Dutch DIY stores. This constitutes one of the dangers for the DIY retail trade in the Netherlands, in my opinion. Products foreign to the sector are a typical phenomenon in the market, like a red thread running through the entire retail landscape. Shops selling housewares also offer garden products, Aldi advertises binoculars plus clothing, and in the DIY stores there is a surprising choice of printer paper, DVD players and table football games – the latter definitely not only because of the World Cup!
The plus in the sales results of this sector in the Netherlands would be a minus without these goods. But must this of all segments supply the fuel for a sector? Not in my opinion. A segment foreign to the trade may well exercise a certain appeal, but only short-term and as a one-off. Once the customer is actually inside the DIY store he also tends to buy other products, which may very well have to do with home improvement. However, articles foreign to the trade should not appear as a visiting card on the front pages of the weekly advertising flyers. This results in the core business being lost from sight. Developing an image as the shopping centre for the DIYer would be for the good of the sector and definitely also good for the reputation of the DIY stores.
