Out with Naim
We were now ensconced in Sheffield and had expanded into the upper floor of Swifts Autocare next door. We had a conference area, a large AV demo room, an office and our stores up there. Dad had retired from active work but his hand was still very much guiding mine in the business. Things seemed settled and business was consistently profitable enough for us to reinvest in our stock and pay all the bills.
However nothing runs smoothly for long. Our relationship with Naim became strained due to differences of opinion between ourselves and our rep. Although it was he who actually opened our account I think he felt that we were not receptive enough or that we didn’t do precisely what the company wanted. After a couple of years he closed our account with no fanfare and little notice. Initially he wanted to close Sheffield and leave Rotherham open. This made no sense because Sheffield did all of the Naim business! Either way it seemed our faces didn’t fit and that was that.
It saddens me to this day that fantastic products can be made into a chore by people who have their own agenda. Something wonderful can become painful and it taught us that good people make good business and that relationships are everything. It also taught us that Moorgate was bigger than any one brand and better to lose any brand than compromise the ethos and message of the company. You have to stand for something.
We managed without Naim for a few years and replaced it with other brands. We never lost our love of the products but some of the people were a different matter.
Over the years we’ve not fallen out with many suppliers but Linn, Naim and B&W spring to mind. Sometimes it’s people and sometimes it’s the direction of travel that cuts against the grain. Sometimes walking away and taking a breather ends up forging a different relationship that is better. Sometimes a break makes both parties think, reflect and then fix whatever was wrong. We have never professed to know other peoples business and we’ve never told a manufacturer what to do. But we do know our business and we won’t have manufacturers dictating how we do things to us. This is less common now but in the past it was the standard operating procedure of companies with a powerful presence in the market. And it became our operating procedure to explain they were full of….sh… bad ideas.
Dad and I have always sat and had a pint in the pub after the shops closed on Saturday, and often with the staff. We would reflect on the week and what was going on in each store. We’ve been doing this for 43 years and we still do it now although less frequently now and we don’t talk quite so much about business. These meetings would be attended by staff on occasion and often by my mum. Mum was company secretary so she had a valued position and input. These meetings were useful for letting off steam and making decisions based on what was going on in the shops.
The decline in Rotherham
Slowly it became clear that our Rotherham store was stalling. We never expected it to keep up with Sheffield. It didn’t have the population or the prosperity. There were many other reasons for this but perhaps the two main ones were parking and Meadowhal, married with a decline in the importance of owning a decent stereo system. This was partly down to the emergence of lots of other things and products that pulled at our customers' luxury budget. Gaming, computers, multiple holidays and the list goes on.
Meadowhall also had a very negative effect on Rotherham town centre. The council really stuck it to retailers by making parking harder and more expensive and by fiercely enforcing it. It is almost as if they wanted people out of town. Great for Meadowhall but less good for its retailers and not good at all for us. We have always found that our customers come by car. And if they can’t, they don’t.
By then we had moved our store across the road to an improved space with better demo facilities. This had not halted the decline in sales. We’d even seen an increase in customers migrating from Rotherham to Sheffield. It seemed that as things were moving up in Sheffield, they were dropping off in Rotherham.
We responded by moving some of the staff around. I started to spend more time in Rotherham to see if I could spot anything we were doing wrong. I couldn’t find anything except a degree of indifference from customers. A lot of tyre-kicking and gunna gunna but not a lot of buying. We did events, we looked at product profiles, we spoke to people and asked them what they wanted to see from us. But try as we might, it felt like retail was tanking in the town.
Eventually we realised that we needed to close down but this isn’t easy when you’re tied to a long lease. And we had to do something because it’s a disaster to have one store drag the other down. The answer eventually came when a brewery agreed to take the lease from us. We absorbed the staff we could into our Sheffield store and expanded our Sheffield store into the adjacent building on Fitzwilliam Street as I’ve explained.
I say this as if it is an easy thing. It’s not; it is far from easy closing something that you set up out of passion. A lot of good effort by a lot of good people had been poured into the store and Rotherham had enabled us to get established. Closing the Rotherham store hurt. And it hurt my dad a lot. He took the opportunity to retire working in the business on a day to day basis and we took the opportunity to remove a sleeping partner from the business at the same time. In later years my dad has explained how badly closing the shop had affected him. It took the closure of our Fitzwilliam Street store (due to our move to Woodseats) to make me fully understand how he felt. I’ll elaborate later.
As an aside from our storyline I wanted to explain why we never opened more stores. We’ve actually looked at opening shops in Leeds, Nottingham, Lincoln and also in a place called Red Brick Mill near Batley. The one in Leeds was formerly Image Hi-Fi in Headingley and that was the closest to happening.
The reason why none of them ever moved beyond the intensive planning phase was people. As in finding the right ones. During our history we've had some fantastic people working for us and all of them remain firm friends. But not all of them have the skills or the desire to spread their wings or to make the move from working in something to running something.
It's the people who make any business great and whilst nobody is irreplaceable, breaking up a good team is a sure way to dilute success. Dad told me later that he saw Sheffield as a way to give me a challenge and he felt without one I might have lost interest. But to take on a challenge I suppose you have to want to and want to with a passion. No passion and no success.
When you open a new store you can't put untried people into it. So you end up pinching people from your main business and this causes a dilution in the team there. Core business shouldn't suffer to add new business. We’d initially seen this in Rotherham but had found Noel Gregory, a member of staff who excelled at sales and customer relationships. He’d fixed the Rotherham team and for a good few years led the charge before the economy turned bad.
In any event our research into additional stores indicated increased workload for little gain. Some retailers who had done this said it made their lives a misery and that it provided a lot of work and turnover but often at a reduction of net profit. All said the team was vital to any success.
That was the main reason why we expanded our store in Sheffield once we’d got over the closure of Rotherham. We did this instead of looking at an additional store or stores.
Fitzwilliam Street
Staff come and go regardless of how hard you try to keep them. Both Ian and Richard left to pursue their careers in different directions. We were sad to see them go but life goes on. Paul Cooper started working in the Sheffield shop and we began the search for another member of staff. We’ve had some great people but we’ve found that nobody is irreplaceable if you show their replacement the right way to do something and harness their enthusiasm and love for music.
Sadly our good friend Nigel Charlton passed away at the young age of 41. He was and is sadly missed as his conversation was nothing if not sparkling and entertaining. He is as vivid in memory as he ever was in life but I can’t say that we don’t miss his wicked sense of humour.
Short of staff we placed an advert somewhere or other and interviewed about ten people to join us. The only person that stood out was Nigel Vawser and he joined us at his earliest opportunity. Nigel knew nothing about hi-fi but loved music and was extremely willing to learn. We started by showing him how to set up a system from scratch and did some demo’s to illustrate how much difference existed between various components. He took to it like a duck to water. We got him to Linn, to Naim and to Cyrus and we arranged a whole raft of in store training with other manufacturers.
Nigel was very smart but he was unassuming and the sort of person who you would say was “quietly confident”. He looked at things slightly differently and had ideas of his own. As I grew to know him better I realised he was extremely capable and would be of great use to us. Some of his ideas we put into practice immediately and to good effect. Customers liked him and his sales were extremely good.
I recall going for a pint with him at the Cross Scythes in Totley. This would have been around 1993/94. He’d mentioned he had something to talk to me about and asked that we do it outside work and free from distraction. Talking at work is almost impossible because our phone rings and customers and reps call in. We wouldn’t have it any other way of course.
“Paul I want to tell you about something that I think is going to be potentially massive for Moorgate. It’s called the World Wide Web”
As a result of this conversation and a lot of hours of discussion (followed by months of graft) Moorgate were one of the first British Hi-Fi companies to have a web presence. And it became clear within a few months that Nigel was correct. I remember Nigel and myself trying to explain all this to my dad. He was pretty dumbfounded by the concept but had a lot of faith in Nigel. He gave us plenty of rope with which to hang ourselves. But as it worked out we didn’t even build the gallows.
Nigel claimed that the only point in a website is to sell. It must sell Moorgate and it must sell products for us. As a result we could not use a third party to run our website for us. His belief was that we needed our hand on the rudder. If we got a product in, we needed to be able to update and place that product online within moments. Paying someone else to do it when it suited them was going to be both slow and expensive. Even I could see the sense in this. Web designers can and will tell you anything. I’ve been told a million times that such and such a company could make Moorgate number one on google. But how can they say this to all their customers? How can they make two hi-fi stores number 1?
It was painful because I had to learn how to build a website from scratch. Nigel was there to help with the structure of the website but my job was populating it within this structure. Progress was slow but I needed to do it because the business was now “my baby” so to speak.
I can’t emphasise enough how important this process and Nigel’s input was. It enabled our business to grow (without adding another store) and it enabled us to reach new customers far more effectively than any advert or brochure.
The impact was such that we went from having a rack full of used audio equipment gathering dust to stuff selling within days (sometimes hours) of it coming in. We’d take some photographs, upload them onto the website and the phone would start ringing. All of a sudden we were meeting new customers who knew our history. And our inbox was full of people wanting advice. It improved our ability to communicate with our customers and the process was immediate.
This all happened extremely quickly and it is perhaps because we were early adopters that we benefited so much. Early bird and all that.
Looking back it’s hard to think back to a time without it. The internet has proved itself to be an instrument of great wonder and immense devilry and I have a love hate relationship with it. It is something akin to Pandora's box.
If you had asked me back then how significant it would be I would have had no idea. But sometimes a leap of faith is required and sometimes standing still death in business. And Nigel had the strength of his conviction.
Interestingly writing the copy for the website allowed me to reflect on the things we’d done that worked and the things that we had done which had not worked. It crystallised a lot of ideas. At this time Linn started to offer us training in retail. We jumped at the chance because we were eager to learn. We decamped en-masse to Glasgow to be LINNED.
LINNING
The Linn training also covered management and one of the things I took from this was that the best place for a dealer principal is in the store. Linn called it “managing by wandering around”. This is what I’d seen happen with my dad in our Rotherham store and I was keen to keep immersed in the business and in close contact with our customers. Even if only to say hi or to ask how the demo was going or to add a second opinion. I can also get away with saying things my staff might struggle with. If I know someone well enough I can simply say “get it bought”.
The training and the self evaluation made us take a close look at some of the things we did and look to improve them. Small changes are what we’re talking about really. Trying to get customers listening as soon as possible. Trying to avoid confusing people with too much choice when really they want the best choice. Listening as carefully as possibly to people’s requirements.
Over the years a few of our suppliers have run sales training courses and to be honest most of them are of extremely limited use. I say this because there is no exact sales formula and people are individuals and don’t follow some kind of herd mentality or “hive-mind”. You can sell a superb system and have another customer wander in when you’re about to strip out the demo room. They have a quick demo and are not overly keen on what they hear.
Two things have stood out to me over the years and these both relate to listening. The first is trying to find out how good a sound someone needs. This is often based on what the customer already owns, what their experience of good sound is and also if they are familiar with live music. We have to make a sound good enough for them to discover sound quality that exceeds their expectations. Either that or we must raise their expectations.
The second is that equipment can be measured by fatigue factor. If you enjoy listening to it and it isn’t tiring on your ears then it is a good system. If you can listen to it for an hour or so before you feel inclined to do something else then there is every chance that it isn’t up to the standard you need.
The Linn training was very good. It was challenging and sometimes uncomfortable but it was also probably the most useful we’ve had. And it was far wider in its approach than just about selling Linn and could be applied to any product and to the business and sales team as a whole. It focused on becoming efficient and on customer satisfaction. The main cut and thrust of this is many businesses concentrate on new customers but the best businesses concentrate on the customers they have. A satisfied customer then introduces his friends and contacts to you and becomes an ambassador for you. This resonated with us because we’ve always felt that the people who are our target customers are basically people who love what we love. We talk the same language and these folk will generally find you if they’re interested in doing the job properly. General advertising is a waste of time.
Around this time I was press-ganged into becoming the vice-chairman of BADA, The British Audio Dealers Association. I accepted and eventually became Chairman too. I did a lot of work, did some speeches, did some brainstorming and then realised some salient and sobering facts about our industry. The first of these is that manufacturers and retailers see things completely differently and usually won’t see eye to eye. I’ve seen so many instances of this that I have lost count of them. It was my job to try and change this. Eventually I realised it was akin to pissing in the wind and getting wet.
BADA had many great ideas and for a while it managed to do some good. It even tried to forge closer ties with our suppliers. In this it failed. I put a lot of time and effort in. I was young and I thought I could help change things for the better and move everything forward. However I had not countered on people who didn’t want to change, wouldn’t change and were as set in their ways as a bug trapped in amber. I am referring to other retailers and to a lesser extent some of our suppliers. It was an unpaid position but eventually I decided I’d not do it for all the tea in China.
It was like trying to teach a mouse to maintain a car. And the mouse didn’t want to learn.
BADA also taught me that meetings of any kind that involve more than five people are a complete and utter waste of time. People sit and nod their heads and then go home and forget all about it and all the things they’ve agreed to.
My time at BADA lasted for perhaps five years. I learned a lot but most of it was to do stuff and not talk about it and to not expect anyone else to add any real momentum. I learned to keep meetings brief and between small groups of people, all of whom had the ability and the power to make decisions and act on them, as opposed to nodding their heads.
Hi FI Magazines
Our experiences with Hi-Fi magazines haven’t convinced us to trust their professionalism or impartiality. I am not telling you this to bad mouth them or indeed to stop you trusting them. As enthusiasts there is nothing more natural to want to read about the equipment that you are interested in. I do not want to discourage this but merely to give you another perspective.
In our history (and perhaps up to 15 years ago) the magazines were very powerful. A good review made a big difference to the sales of a product. Sometimes it helped transform a supplier from a “kitchen table” outfit to a big commercial company. Equally it could force the company into a downward spiral as the “fantastic reviews” petered out. In fact the power of the press is one of the things that makes manufacturers change their products so often. In simple terms a revised/improved product could be resubmitted for review just as sales were starting to taper off. The press doesn't report on products that have been around for a while. Or they rarely do. They’re interested in new and improved equipment.
Retailers would buy products that had great reviews because those were the ones that customers were interested in. Sometimes these were not always the best products. I recall demonstrating a Linn Intek against an Audiolab 8000A. The Linn sounded better with his speakers but the customer bought the Audiolab.
We were invited twice to take part in a retailer review scheme. On both occasions we were asked to “buy a good review”. We didn’t and so we didn’t get reviewed. That was fine with us but it did change our view of the press.
I got to know many of our suppliers and often (over beer) I’d be told how the advertising worked and how the booking space on the back cover would generally mean better reviews. I won’t mention any specific magazine and I’m not tarring everyone with the same brush. Merely pointing out that the Hi-Fi press make their money from advertising and NOT from the sales of the magazine. They simply don’t sell enough copies to be profitable from magazine sales alone. Particularly now when magazine sales are generally in massive decline. So the people booking big adverts are more important than readers.
Finally (and excuse me if I’ve mentioned this before) I was invited to two meetings with a well known Hi-Fi magazine that is still trading and in my capacity as the chairman of BADA. The first was to help them get better sound in their listening room. This was a terrible room. It was extremely dull sounding and had a bass problem. As a result equipment which was bright/forward and recessed in the bass got good reviews. Everything else got classed as dull, boomy or both. This was simply down the room. Where they used independent reviewers they would have a far better chance of getting honest results. But in-house was a farce. We helped fix that with the use of a number of things that were relatively simple and involved removing some things and adding others. The fact that they were reviewing equipment and yet didn’t know any of this stuff was something I found truly hard to grasp. Or at least then.
The second time I had a sit down with the editorial director of What Hi-Fi? at the behest of Mission. He wanted to know why retailers like Moorgate tended to distrust the press and as a rule were not advertising with them. At this time most of their business came from the larger groups like Sevenoaks and Richer Sounds (plus manufacturers).
For over an hour I explained our experiences over a few pints of Guinness. I didn’t pull any punches. He made notes and nodded his head a lot. When I had finished I asked him what he thought and he told me that he mostly agreed with me and understood my reservations. I asked him if he thought that changes could be made to fix this. He said he doubted it as his boss had very set ideas about the direction he wanted the magazine to move in. I thanked him for wasting my time. There are worse places to be than sat in an Irish bar drinking Guiness however.
My conclusion then and now is that the magazines serve a purpose but are “outside” of our industry and feed on it like parasites. That sounds harsh, I know. The bigger you are the bigger a shout you’ll get in the magazines and this is down to advertising budget as opposed to anything else. Hence the championing of some brands and retailers. I can’t blame either brand or retailer for doing anything within the law to help grow their business. I am an idealist and hope for better but that has not been our experience. For that reason we do not advertise with any of the hi-fi press and I don’t personally read them.
I understand why people read them avidly and particularly when they are new to Hi-Fi and want to learn more. If they encourage people to listen then they have done a great job and I salute them. But more and more it seems to be about driving customers to online retailers where they can get the best deal. Usually this is in no way in the customers best interest and we often get to pick up the pieces. This trend of delivering customers to online retailers has continued and pretty much explains the editorial policy of most enthusiast magazines. It is not based on respect for the consumer. It is based on charging retailers for sending people to them.
My dad and I often discuss how many people are genuinely interested in quality enough to seek out a decent stereo system and we reckon it is about 2% of the population. That really doesn’t seem a lot but then again if you ask yourself how many of your friends share your enthusiasm and that would give you some indication.
Home Cinema
Home Cinema cropped up before the demise of Rotherham and for a few years was a significant part of our business. It was about sound and so we thought “here’s something we know about”. I had some reservations as did we all but we were encouraged by some of the results we could get and felt that demonstration of it would be important to the customer. So we gave over a demonstration area, bought some TV’s and went on a lot of courses to learn how to get the best out of the format.
Arcam was very useful in the training process. They had embraced home cinema fully and at the time were extremely good at breaking down the technicalities of setting up and fine tuning the system. Product calibration is complex but methodical when you have the right set up equipment. Our thanks go out to them for this.
For a few years home cinema gave us some business. Then everything changed and it was a fairly protracted and painful process to realise the what and the why. In short the magazines were telling people what to buy and sending people to online/shed type operations who were mostly discounting the brands but selling lots. It became evident that most of the businesses were tax dodging and giving away the VAT.
Even worse was the fact that customers would give us a shortlist for us to demo and then we’d never see them again. They were getting a listen at our store and then buying cheap.
I’ll end this section of our history by saying we all went to the Devonshire Cat one Saturday and sat drinking beer with very long faces. One of my staff said “it’s as if they place no value on what we do”. I thought about this and we all thought about this and I sat up and said; “let’s pack in selling Home Cinema” and everyone else all but leapt up and cheered.
Tuesday morning it all went in the window or on eBay and the money we got back from it went into improving our stereo equipment and getting back to doing something we loved. And love it we did. Morale in the store hit an all time high. Some customers completely got it and others didn’t but we kept our heads down and ploughed on regardless.Many retailers fared less well. They threw the baby out with the bathwater and it was too late to make the plug run the other way. We saw the problem and acted extremely quickly and we can do that because we are small and agile.
Part 4 to follow.