Unlocking retail success with fractional services

Navigating the changing landscape differently

The retail industry has long been a dynamic and ever-evolving landscape, with businesses constantly adapting. ADAPTIVE RETAIL – that’s my new catch phrase and it is a new buzzword. But I love it, as it captures the long-held goal of retailers everywhere. If customers and the landscape are changing at a speed that outpaces a retailer’s ability to keep up, then they need to remain adaptive. Adaptive Retail it is.

And in this rapidly changing environment, traditional approaches to staffing and resource allocation are often no longer sufficient to meet the demands of modern retail operations. Especially in New Zealand where there are head count freezes, downsizing and holes all over the business. But the business still needs to forge ahead. Do more with less. Enter the concept of fractional services - an innovative solution that is transforming the way retailers approach their human capital and operational needs.

The Rise of Fractional Services in Retail

In the past, retailers would typically hire full-time employees to handle a wide range of functions, from marketing and merchandising to store development and financial management. However, as the industry has become increasingly complex and volatile, this one-size-fits-all approach has proven to be inefficient and often cost-prohibitive. Think about it – there have been many a time when you need someone super capable to “just come in and do it.” Fractional services have emerged as a game-changer, allowing retailers to access specialised expertise and capabilities on an as-needed basis.

Defining Fractional Services

• Fractional services refer to the practice of hiring part-time or temporary professionals with specialised skills to perform specific roles or tasks within an organisation.
• These professionals, often referred to as "fractional executives" or "fractional specialists," bring a wealth of experience and expertise to the table, without the long-term commitment and overhead associated with full-time hires.
• Some might say “how is this different to a consultant?” Consultant typically offers strategic advice and guidance based on their extensive knowledge and experience in a particular field.
• The key distinction lies in the level of involvement and engagement. A Fractional services expert provides more hands-on collaboration and support while a consultant provides arms-length advisory support.

The Advantages of Fractional Services in Retail

The retail industry in New Zealand has started to embrace fractional services for a variety of reasons. I know retail support offices I worked in there was a desire to always “own” the talent or have a “contractor,” but that comes with a whole host of challenges. So, this approach is well worth considering

Cost-Effectiveness: Fractional professionals typically work on a part-time or project-based basis, which can be significantly more cost-effective than hiring full-time employees. This allows retailers to access high-level expertise without the burden of salaries, benefits, and other overhead costs.

Specialised Expertise: Fractional professionals often have deep expertise in specific areas, such as digital marketing, store design, or category management. By tapping into this specialised knowledge, retailers can address complex challenges and capitalise on emerging opportunities more effectively.

Flexibility and Scalability: Fractional services offer a level of flexibility that traditional staffing models cannot match. Retailers can scale up or down their fractional support as needed, adapting to changes in market conditions, seasonal fluctuations, or strategic initiatives.

Fresh Perspectives: Fractional professionals, by virtue of their experience working with multiple clients, can bring a diverse range of perspectives and innovative ideas to the table. This cross-pollination of ideas can lead to creative problem-solving and improved decision-making processes.

Reduced Risk: Hiring full-time employees involves long-term commitments and potential termination costs. Fractional services, on the other hand, allow retailers to mitigate these risks by providing a more agile and low-risk approach to accessing the expertise they need.

Fractional services in retail have several key applications that can be leveraged across a wide range of functions within the retail, each offering unique benefits and addressing specific challenges.

RX Group offers extensive fractional services in retail across the following applications:

Fractional Marketing Services

In an increasingly digital and data-driven landscape, retailers often struggle to keep up with the pace of change in marketing strategies and tactics. Our fractional marketing professionals include digital marketing specialists, social media experts, and senior marketing and branding consultants. What makes them unique is they have worked in retailers of every shape and size and can help retailers develop and execute effective marketing campaigns, optimise online presence, and stay ahead of the competition.

A success story – Manawanui

RX Group created a fractional marketing team for Manawanui. For a little more than the cost of one full-time staff member, Manawanui get the flexible time of a c-suite level Marketing and Communications Strategist, a Senior Marketing Manager, a Social Media Executive, a Digital Marketing Manager as well as access to the RX Group creative studio.

We operate as an extension of the Manawanui team -with Manawanui email addresses and attend the bi-yearly team days! It is a great model. It ensures the strategy and execution is class leading and that recommendations are timely and cost-effective. So Manawanui can focus on looking after their community and the RX team can do what they do best so ensure Manawanui's continued success. Read more here

Fractional Store Development, Merchandising and Category Management

The physical retail experience continues to evolve, with consumers demanding more immersive and personalised in-store environments. But often this requires strategic thinking, experience, and heavy lifting upfront and then ongoing in-store implementation. Different skills at various stages. And often there needs to be a heavier focus on key events and then nothing for the remainder of the year.

Fractional store development and merchandising experts can provide retailers with the strategic guidance and hands-on support needed:

Store development: to develop customer zones, communications hierarchy, store tiering hierarchy and store plans, defined customer journey and adjacencies, category positions, etc.

Visual Merchandising: to design and maintain engaging store layouts, optimise product placement, and create visually compelling display and merchandising standards.

Category Management: to undertake category reviews, develop new range plans or build categories from scratch.

Fractional Operations and Technology Support

Technology is the backbone of modern retail operations, from point-of-sale systems and e-commerce platforms to data analytics. Likewise, Operations teams are the lifeblood of connecting the customer with the retailer. Fractional specialists can help retailers navigate the complex and ever-evolving landscape, ensuring their systems are efficient, fit-for-purpose (we all know we tend to build and build and build without having the time to look back) and aligned with their business objectives.

How does a retail business implement Fractional Services?

Leveraging fractional services in retail requires a well-considered approach to ensure maximum impact and long-term success. Here are some key considerations for retailers looking to implement fractional services:

Identifying the Right Needs

• The first step in implementing fractional services is to assess your organisation's needs and challenges.
• This may involve evaluating your current staffing model, identifying skill gaps, and determining which functions would benefit most from the addition of fractional expertise. Prioritise what is important, necessary and nice-to-do.

Selecting the Right Fractional Professionals

• Once you've identified your needs, the next step is to find the right fractional professionals to address them.
• This could be because it is a combination of people as opposed to just one person – someone super experienced and senior to start and then someone mid-weight to implement
• When we work with businesses, we are frank and honest about what is needed. Because we are used to fractional roles, we aren’t wanting to “fill a day and a job” – we are working towards delivering effectively and efficiently as possible – because we have other jobs to do.
• It’s a good honest conversation to carefully evaluate the qualifications, experience, and fit of potential fractional team members and what role they serve (sometimes they might be put in place simply to be a grown up in the room as you recruit a new team leader).

Defining Clear Roles and Responsibilities

• To ensure a smooth and effective integration of fractional services, it's crucial to define clear roles, responsibilities, and expectations for both the fractional professionals and your internal team.
• This includes establishing communication protocols, setting measurable goals, and outlining the scope of work.
• Fractional service experts are used to working in multiple unfamiliar cultures and teams but sometimes the teams themselves are unsure “where does this person fit.” It’s essential to ensure the fractional team members can get cracking and be as effective as possible the minute they hit the ground.
• Integrating fractional professionals into your existing team can present some challenges, such as ensuring effective collaboration and knowledge transfer. To overcome these hurdles, we focus on fostering a culture of open communication, providing ongoing training and support, and saying lots of things aloud.

Measuring and Optimising Performance

• Regularly evaluating the performance and impact of your fractional services is essential for ensuring long-term success.
• This may involve tracking key performance indicators, gathering feedback from internal stakeholders, and adjusting your fractional services strategy as needed.
• We have never had an issue with performance, the opposite occurs…..businesses wanting to hang on. That is where we are incredibly open and honest “you don’t need us now – the work is done and now….you now should hire someone / fly be free / the processes will work with your BAU team / etc., etc.
• 9/10 (well at RX Group), your fractional service team member will give you a heads up that you won’t need them soon. But that is what you want – grown-ups in the room.

The Future of Fractional Services in Retail

In the dynamic and ever-changing world of retail, the adoption of fractional services has emerged as a game-changing strategy for businesses seeking to navigate the complexities of the industry. As the retail landscape continues to evolve, the role of fractional services will only become more critical. Savvy retailers who embrace this innovative approach will be better equipped to overcome challenges, capitalise on emerging opportunities, and stay ahead of the competition.