kbbreview · October 2013
“From inspiration to installation”
David Harris talks to Grant Bliben of Aquarooms in north London who has downsized and gone back to the old-fashioned values of service and installation rather than trying to slug it out on price with online traders
How do you beat the internet? This is not a new question, but it is arecurrent one. Nearly every traditional retailer in the country has had to face it in recent years. The reason is almost always the same: online sales sites
offer the same products at discounts that bricks-and-mortar shops find difficult or Impossible to match. For many bathroom and kitchen shops, the answer has been – if you can’t beat them, join them. They have gone online themselves, so that they operate directly against the web-based competition. Nothing wrong with that, but is there anything else to be done? In particular, is it possible to develop an approach that the internet will find as threatening against them as ultra-low prices are to traditional retailers? Grant Bliben, a lifetime plumber and owner of north London bathroom shop Aquarooms, thinks there is.
He has nothing against the internet. Indeed, he calls it “one of the greatest tools I have ever had at my fingertips”. But he also believes that the real edge that retailers can develop over internet rivals is not so much about embracing the future as looking to the past. He argues that one of the problems with internet sites selling cheap bathroom equipment is that, however cheap they are, they can’t accomplish the same design and installation work as an established retailer with a local showroom. So his answer for how to compete in the future is to go back to old-fashioned service and reliability to make a point of difference, compared with impersonal websites that offer low prices, but little accessibility and accountability. He explains: “The only thing we are guaranteed that we can hold margins on is people.
Installation and design service holds the key for us and 80% of our sales come from providing the full service – from ‘inspiration to installation’, as I call it. Margins can be eroded on products, but never on service.” Grant’s chance to put his philosophy into fuller effect came last year after Tesco said it wanted to set up a shop in Aquarooms’ old showrooms in north London. This was a stroke of luck in more ways than one. Not only was he able to sell the supermarket giant a 20-year lease on the 5,000sq ft space in Southgate, so that it could be turned into a Tesco Express, securing a solid income for the future, but it also allowed him to set up a new, albeit smaller, showroom in another part of north London. Aquarooms moved to High Barnet – in a 1,500sq ft site just a few minutes’ walk from the tube station on the end of one branch of the Northern Line. And since selling the lease to Tesco, he has had more than one offer from property investors who want to buy the freehold on the Southgate building so that they can take advantage of the solid income stream. Buildings let out to supermarkets are highly sought-after by property investors, because companies such as Tesco are among the most reliable tenants. But so far, Grant has held on to the freehold for Aquarooms’ old building, which is even more valuable because it has several flats above it that are also rented out. Aquarooms may have left Southgate, but it did so with a solid and continuing revenue stream ﬁrmly in place. This left Grant free to develop a new showroom in just the way he wanted. One of the ﬁrst things he did on opening the new shop was to sign up seven ﬁtters so that the emphasis of the new showroom was on selling products that its ﬁtters installed. Grant says: “We’ve gone backwards with gusto. Before this, we found we were losing a lot of the small sales – shower trays and taps, for example – mostly to the internet. That changed once we started ﬁtting them as well as selling them.” Most of Aquarooms’ business is in a geographical arc around the showroom, including places such as Barnet, Hadley Wood, Totteridge, Potters Bar and Brookmans Park. The company also has its own warehouse in Hadley Wood. Aquarooms is sometimes approached to do work further away from its north London heartland, but Grant feels he can’t provide the service he wants, and that customers need, if he has to take account of too much travelling time for his ﬁtters. The formula of selling and ﬁtting relies on Aquarooms taking full responsibility for each job.This could be as small as replacing a tap, but it is likely to be an entire bathroom and Grant is obsessive about having complete control. “We do the lot – painting, decorating, tiling,underﬂoor heating – we don’t want another tradesman in there. What the customer is worried about is overall cost,” he says. Having a shop also matters, he adds, because customers are reassured that responsibility for the work lies not just with a company, but with one company in one place. Grant adds: “If you want a plumber nowadays, you are mostly relying on mobile phone numbers, most of which are unaccountable. Because we are in a shop, people know where to ﬁnd us all the time.”
The measure of the success of the new Aquarooms showroom and Grant’s fresh approach is in the ﬁgures, which seem to underscore the fact that whatever else the internet can do, it can’t install bathrooms. Last year, turnover had dropped to £1.5 million, down from £2.5m ﬁve or six years ago – the same sort of fall experienced by many retailers. More importantly, the company was doing no better than breaking even last year –clearly not what any business wants. This year, things have been different. Since the move in December, Aquarooms has been making a margin of 30% on increased revenue – a turnaround Grant attributes almost entirely to the return to an old-fashioned “designed by us, bought from us, installed by us” approach.
Record profits “We are now getting the highest proﬁts we have ever had,” he says. Customers still sometimes ask about the price of individual products – say a toilet – which they can ﬁnd for 5% or 10% cheaper on the internet. Grant’s response is polite, but robust – “Yes, but they won’t ﬁt it for you”. Aquarooms’ business now breaks down into 50% design and installation, 35% working for architects and just 15% straight retail.This is one reason why Grant remarks that while Saturday used to be the busiest day of the week for the showroom, it is now the quietest. One other consequence of moving to a new but smaller showroom was that Grant had to look long and hard at what products he offered, because he no longer had the space in the shop for as wide a range. The leading brands the ﬁrm now concentrates on include Villeroy & Boch and Duravit, although Grant does try to widen traditional choices with some unusual Italian specialist manufacturers such as Hidra and Artceram. This allows customers to make their bathrooms different with one or two unusual pieces, if they wish. But whatever they choose, Grant is not only happy to ﬁt it, but much prefers to do so. In a very literal sense, he is acting out his dream of beating online prices by selling something that the internet ﬁnds much more difﬁcult to match – old-fashioned service.