Merchandise and brands
Lewis Group, through its three trading brands, is focused on the retailing of furniture, appliances and audiovisual household goods to customers mainly on credit. Lewis continues to create distinctive merchandise ranges through its strategic supplier relationships both locally and internationally.
The group’s merchandise strategy is based on the philosophy that customers are attracted into stores by the product offer rather than the credit offer.
The focus is therefore on providing customers with quality, exclusive and differentiated furniture ranges. This is achieved through the following:
- Innovative product sourcing both locally and offshore enables the group to offer customers exclusive and distinctive furniture ranges at affordable prices.
- Added value features and components on products ensure differentiation and enhance the perceived value
of the merchandise.
- New furniture ranges are launched twice each year to offer ongoing newness to customers.
- An electronic merchandise catalogue is displayed in all stores as the complete merchandise range cannot be stocked in stores owing to space constraints. Sales staff assist customers to navigate their way through the full range on a large touch screen, as well as view all the available colour and fabric options.
It is an active strategy to focus on increasing sales of the higher margin furniture and appliance product categories.
Products are sourced from a wide range of local and international suppliers to ensure that customers are offered exclusive product ranges.
Products are sourced to meet the speciﬁc needs of the group’s lower to middle income group customer base. The offering includes branded merchandise which is appealing
to the target market, selling more contemporary lines in each furniture category to attract younger customers and furniture ranges which are suitable for smaller homes.
The import programme ensures furniture ranges are developed using the latest designs and manufacturing techniques. International factories accommodate a broader range of developmental designs and offer a wider variety
of raw materials which allows for product differentiation. Imports offer price and design advantages and mitigate the risk of disruption in local supply. Direct imports accounted for 18.4% of total purchases in the period under review.
Products are supported by local and overseas after-sales service to ensure quality standards are maintained. Before consignments are despatched from suppliers a sample of all imported products is assembled and tested for quality purposes.
Supply chain and distribution
The group’s supply chain model is based on merchandise being delivered directly by suppliers to stores. The group does not operate distribution centres or centralised warehouses. Each store has a storage facility which is located close to the store, generally in an area with lower rentals than retail space. Stores have their own vehicles and are responsible for all deliveries to customers. This strategy has many beneﬁts as it limits the build-up of obsolete stock and reduces markdowns. It also signiﬁcantly improves service levels as stores are able to make an average of 90% of deliveries within 24 hours of the sale.