Healthcare provider Simplyhealth faced an “almost impossible” task to achieve the turnover necessary to maintain its mobility retail operation, The Unlimited Company, which it announced it was closing yesterday along with 10 shops.
That’s the view of some retailers in the mobility industry who have been speaking to AMP over the last 24 hours following news of the group’s U-turn.
The Unlimited Company launched a year ago and since then parent company Simplyhealth said it has seen a shift in customers’ requirements, citing growing competition from general and online retailers selling mobility products as one of the main reasons that its model was no longer sustainable.
Rival retailers acknowledge the pressures facing the market, but question whether The Unlimited Company did enough to stand out from the crowd.
Richard Holland-Oakes, managing director of Recare, said he was not surprised by The Unlimited Company’s closure and added mobility dealers need to specialise to compete in a market place that is increasingly impacted by the internet.
He said: “From our point of view, you’ve got to look at rent and rates. The amount of turnover they needed to achieve was an almost impossible task. Starting a business at the premises they were was a very expensive task and the shops were all very swish. And although they have deep pockets, it’s still got to make a profit. It’s a sorry state to see but I’m not surprised.”
Meanwhile, Spencer Coe, managing director of ScootaMart, one of the largest mobility scooter retailers in the country, disagreed with Simplyhealth’s suggestion that customer needs had changed.
“I do not believe there has been a ‘real shift in the requirements of customers’ or that large retailers/online providers have a wider range of products; all the major retailers have traded for many years without making major changes as the way they operate is proven,” he said.
“What The Unlimited Company attempted was to change the way the industry worked by creating a different retail experience, but other than visual – which compromised on choice – did nothing different than competitors of theirs have been doing for years, which is treating the customer with respect and compassion, this gives the customer no reason or desire to look for another retailer.”
The Unlimited Company opened a store close to one of Mr Coe’s last year, but he said a visit to the outlet had left him unconcerned by the competition it posed due to “how little stock was on display” and the fact that it was more of an advice centre than a retail outlet.
“If this was the attitude throughout the company it could never survive as a retailer trading from premium priced retail outlets,” he commented, adding: “The Unlimited Company also had a web presence just like their competitors but chose not to use it as a ‘tempter’ to lure customers in to the stores nor as an extra income generator which can only be described as a bad management decision and would ultimately add to the demise of the firm.”
Other mobility retailers said that the key to success in this industry lies in customer care and efficient operation.
Parkgate Mobility’s business manager, Tracy Simmons, runs 15 shops in the north of the UK and stressed that customer care is one of the only ways a bricks and mortar retailer can differentiate themselves.
“You can get a product online for cheaper than in-store. But people are willing to pay the difference if they can feel the difference in customer care. I think it’s about maintaining your retail prices and running efficiently. They’ve obviously not got the balance right. I don’t know what they spent but there’s always a balance there you’ve got to strike.”
Mr Simmons added: “I think for people to comment on their shortfalls is a bit unfair at this stage because we don’t know what happened. But it’s down to the maths at the end of the day – surely when they went into this they had some kind of a business model.”
Julie Potter, owner of 20-year-old business Modern Mobility, believes that there is a danger for the end-user in any mobility company retailing online.
She said that it is “irresponsible” and “dangerous” to sell online mobility products that need to be prescribed, for example scooters and wheelchairs.
“It is really quite obscene that somebody with no experience at all can sit in their bedroom on their laptop and actually sell potentially dangerous vehicles that can be used in public. On a larger scale, you get the ‘proper’ online dealers who are only interested in shifting things in numbers at very low profit. The obvious consequence of that is that the service is then substandard.”
Romana Abdin, chief executive of Simplyhealth, yesterday described the closure of The Unlimited Company as a “very difficult decision to make”.
She said: “As someone with a disability myself I know there is a need for better support networks for people. Unfortunately it has become clear that physical shops are not a viable way forward for Simplyhealth and from a business viewpoint we have to ensure we look at better ways of providing people with the support they need.”