Inside track by Mark Wingett
The title on this inside track ‘silly season’ gets bandied about a lot at this time of year. Many will argue that over the last four years, the period it describes - lack of deal activity, variable sales, decision makers spread across the globe – has come evermore earlier in the summer. Property, more than most business sectors, is prone to a long and pronounced summer lull.
Ian Martin, corporate M&A partner at law firm Macfarlanes, said: “Most advisers and banks try not to execute deals over August but [the usual slowdown] began earlier this year and won’t restart in earnest until September.”
What is certain is that the Olympics brought an added extra variable to this usually most testing of periods, the question that will be asked is whether it has been a positive or a negative one. The mood of operators in the build up was, certainly in the majority, one of foreboding, a case of let’s get through this and wait for the calmer waters of September. This wasn’t helped by a negative weeks’ trading in the run up to the event.
Certainly in the regions, the impact seems to have been minimal during the two weeks, but negative during the opening and closing ceremonies and the two Mo Farah-inspired Saturdays as people stayed at home to watch events unravel. It will be interesting to see what spikes in trade Domino’s and the supermarket, especially through their dine-in deals, received on these occasions.
The tale in the capital, as always, was different. Unsurprisingly, those in or near Stratford have reported impressive figures, as guest traffic migrated from West to East. The traditional tourist ‘hotspots’ were generally quiet and while areas of high office density, such as Canary Wharf, were dead, as workers for the most part made their own decision or were encouraged by employees to take a break or work from home. The return of the ‘regular’ can’t come soon enough for operators in these locations.
However, it does seem that the Olympics has been a tale of two weeks, with trading recovering for many operators in the second week compared to the first, with the fears over transport congestion dissipating along with the recorded Boris Johnson warnings. As Ed Martin of the ETM Group said: “I think people realised after the first few days that it wasn’t such a difficult thing being in town.”
But will there be any long-term benefit? The Government has already peddled out the great intangible ‘the feelgood factor’. A while it is hoped that this will bring more people out of the home and into pubs and restaurants, the reality of a Monday morning after the night before and further downgrade in growth figures may prove a more sobering thought.
However, before all the pessimism. The last two weeks have thrown up a couple of key findings that may have a lasting positive impact on the sector. One is engagement between the organisers, the volunteers and the public. Away from the medals table, the role played by volunteers, the training/instructions they received and the positive way they carried out their duties, many being encouraged to put as much of their personalities into the roles as possible, was for me one the key successes of the Games.
The myth that the UK can’t provide great service was surely put to bed, there was a smile and, in my experience, a balanced approach provided for every occasion and enquiry.
Secondly, was the much-quoted mantra of David Brailsford, British-cycling’s main guru, “the appreciation of marginal gains”. As he puts it: “Taking the 1% from everything you do; finding a 1% margin in improvement in everything you do.”
Two years ago Brailsford and the chief executive of BskyB, the cycling team’s sponsors, Jeremy Darroch, were interviewed about what this mantra means in the business world. Darroch, whose team were taking on many of Brailsford’s principles and workings, said: “If we can make incremental improvements in our efficiency, that can aggregate very quickly to valuable performance and financial benefits.”
As every operator will know small details can make the difference between winning and losing sales and market share. While the Olympics may not have produced a personal best for everyone, in some ways it has just underlined the hard work and key lessons that the sector should fall back on as it faces the final few weeks of silly season and heads towards the finishing tape and the “normality” of September.
