Yesterday, Napoleon Perdis (NP) was dishing out plenty of blame as his $120 million cosmetics empire was placed into voluntary administration.
- greedy landlords
- uncompromising credit environment
- shift to online retailing and decline in shopping centre foot traffic
- lost market share to Mecca and Sephora
I was speaking to a business colleague in the hair and beauty industry after the news broke and from the other factors she mentioned, I thought there were some lessons here for accounting practices and I wanted to share them with you.
MARKET (YOUR CLIENTS)
- NP had the market captured for a long time but as more choices came in, it became harder for that business to compete (you can’t take your client base for granted)
- Instagram has changed the beauty industry and a customer has a lot more choice and can easily compare offerings and prices (social media is affecting all industries and because it may not be a platform you use personally and can’t see the benefit, your clients and your competitors do)
PRODUCT RANGE (YOUR SERVICES)
- NP was geared to professional makeup artists and high end consumers for most part, however then a budget line was created and sold through Target (you can’t be all things to all people)
- was market share gained at the lower end and lost at the higher end? (need to understand both the behavioural and financial impacts on your products and services offered)
RELEVANCE (YOUR VISION)
- NP had not embraced industry fashions and trends and they failed to modernise their products (failure to adopt a contemporary way of offering accounting services, failure to identify the changing needs of your clients and subsequent failure to deliver, impacts on how you remain relevant and of continued value to your clients)
We know there is so much disruption in our industry, so how are you planning on “future-proofing” your practice and your nest egg?