Holland and Barrett's store of the future

“This is the first incarnation of what we think is a better customer proposition,” Holland & Barrett CEO, Tony Buffin, tells Essential Retail during a virtual tour of its newly-reopened Chelmsford store in Essex.

“We’ve made it more modern, extended ranges, made the layout different, taken into consideration all the Covid issues and are thinking about the flow of products differently,” he says. “We are trying to incorporate all those things and make the store more digital. The by-product of that is it’s more contactless,” he adds. “We’re trying to create the store as a portal to digital, and digital as a portal to the store.”

Buffin joined the retailer 18 months ago from building merchant Travis Perkins, where he was chief operating officer. Prior to the pandemic he had already begun overseeing Holland & Barrett’s multichannel strategy. “We were doing a fair amount already,” he says. However, the crisis meant it had to temporarily put the brakes on its in-store transformation plans and prioritise eCommerce, which has seen a “dramatic” increase in demand.

The health store has remained open during the crisis, as an essential retailer. But it still experienced an unprecedented demand for online, which was up five-fold at one point and outperforming the in-store sales of its 1,300 branches.  

 “We had to stand up a new warehouse and we repurposed 50 of our stores into mini fulfilment centres,” he says. “Before Covid we were dispatching 7,000 to 8,000 parcels per day… during Covid we were dispatching 10,000 parcels just from our 50 stores.

“To turn on that physical capacity over night was really challenging. We employed another 450 people to keep the stores open and another 250 people in our manufacturing plant and distribution plant to keep that moving. And we did all that remotely.” That huge logistical feat appears to have paid off. “The business is growing year-on-year and we managed to maintain growth, so we are pleased with that.”

New-look stores

Now things have started to return to normal (for the moment at least) the retailer has refocused its vision for the future store. 

“Covid has accelerated what would have taken 18 months to two years [for online]. It’s forced us to be innovative, so that has been a good thing in an ironic sort of way. But it has also accelerated our digital plans and made us think harder about what the network [of stores] will look like in the future.”

At the entrance of the Chelmsford branch, Buffin points out its sanitation unit operated by a foot pump – so customers don’t have to handle anything – and a temperature checker. The layout of the store has also changed: food has moved to the back and vitamins, minerals and herbal supplements (VMHS) to the front.

“In VMHS – a big emerging trend for customers is gut health,” he says. “We’ve also brought immunity to the front of the store, as you can imagine that is a big deal for customers at the moment.” 

As part of its personalised healthcare drive, the store is also selling diagnostic kits “to help customers understand what their conditions are and what they might need to do differently. Whether it’s a different lifestyle, eating differently, or supplements.” That could be especially useful for customers who don’t want to visit their GP for minor complaints at the moment, he says.

Buzzers have been installed near its point of sales, to alert sales assistants to customers seeking advice about specific products. “We’ve tried to get more digital integration [using chips], which they can scan to get information about features and benefits without having to pick the product up,” he adds. 

He points to a contactless click & collect drawer, the first to feature in any of its branches. “So when you order a product online, you get a barcode or QR code and the drawer automatically opens and you can pick up your product and leave.”

In addition to the new layout and product ranges, it has enlarged the space by 15% – by getting rid of the back store and having staff replenish items straight to the shelf using storage drawers. “Increasing efficiency and reducing the time teams spend going backwards and forwards.”

Integrated experience

The point of the new layout is to give customers the best experience, however they chose to engage with the retailer. “You can come into store and order a product, or you can come into store and speak to the team and get advice,” he says. “Alternatively, you can have a private video consultation with someone from our support centre in Nuneaton, where they can give you nutritional, weight management or beauty advice,” he tells Essential Retail in one such dedicated room once our tour has ended. 

“What we are trying to do is make the physical and digital environment completely seamless so there’s no barrier to coming to find us.”

Many believe the pandemic will speed up the decline of the high street, with more casualties yet to come. So does Buffin envisage fewer stores in the future but a more digital offering for those remaining open? Not necessarily.

“I think we might want more physical touchpoints, whether that is full stores or not, I don’t know yet.. because people are tending to shop more locally.” Sales have remained strong in open air retail parks, smaller high streets and where it has co-located with grocers. While footfall in large enclosed shopping centres is doing less well, he says. 

“I think for the smaller high streets this in some sense might reinvigorate them… and actually if there are periods of lockdown in the future, people will have to shop more locally,” he says. 

“Our retail footprint hasn’t really changed much in the last two years. It’s been pretty static,” he adds. “We’ll probably have some hub stores in the future… with bigger product ranges and video consultation expertise.. then what I have described as nodes, where there will be more click & collect and smaller in-store product ranges. 

“We may have more points of contact in the future, they might just be configured in a different way.”

Photo credit: Jake Darling Photography