After a challenging start to 2022 due to high street footfall, Flying Tiger Copenhagen’s 2022 annual report reveals the retailer is back to pre-pandemic revenue figures. Annual global revenue is up 25% compared to the previous year, with UK and Ireland experiencing the largest growth overall at 34%.
Flying Tiger Copenhagen operates 102 stores in the UK and Ireland, which collectively turned over £71m in 2022.
The incredible success of the Danish variety retailer comes following a year of financial turmoil for UK highstreets, which saw catastrophic figures for many. In 2022, an estimated 17,145 retail stores closed and the CRR also reported that 151,474 retail jobs were lost.
And yet, among the chaos, Flying Tiger Copenhagen appears to be bucking the trend. We spoke to Michael Burke, managing director for the UK and Ireland at Flying Tiger Copenhagen, who gave us some insight into the business’s outstanding results.
Developing the retail concept
2022 saw a specific focus on the in-store concept, customer journey and innovative fixture and fittings. These new developments came to life with the relocation of the business’ flagship Tottenham Court Road store in London.
Burke comments: “The Tottenham Court Road office is the location of our UK HQ so naturally it’s the place to pilot new initiatives. The store itself is our flagship and showcases some fixture and fitting developments to enhance the customer journey. They include open cabinets, pedestals in the windows and on the floor, and high shelving units which provide additional selling space.”
The new furniture concept is designed to shine a spotlight on the newest campaigns that come into stores every month.
Burke adds: “Other changes involve store lighting, opening up the window displays, improved sightline through the store and changes to how we display our key products – all contributing to higher sales revenues and efficiency for the store team. It’s now the template for a new retail furniture concept with core elements being rolled out in new and refurbished stores across the Group.”
The UK also took the lead with the group innovation of self-service checkouts.
Burke said: “We implemented self-service kiosks as a testbed for wider organisation. Around 80% of transactions now happen at these digital kiosks, which demonstrates that our customers really are happy to adopt them.” He added: “Over the busy Christmas period, the new payment system drove efficiency during peak trading whilst providing an improved experience for the customer at the checkouts due to shorter queues.”
As a result of their successful trial, self-service kiosks are now planned for other markets within wider European estate.
Tech and digital innovation
Burke explains that in the past 12 months, Flying Tiger Copenhagen has been laser focused on developing their customers’ digital journeys along with Tech improvements in the retail operation.
Tech development of stock management and integrated planning tools has been key to the business success in the last two years, Burke comments: ‘’Merchandise planning of stock has taken a huge leap forward in the UK & Ireland, to enable the right stock, right place, right time. We now have the group’s first auto replenishment system (Nextail) in place that enables the store managers to focus on their team, the store merchandising and the customers needs instead of spending time in offices ordering stock. The intelligent software adapts quickly to individual store trends and demand. The obvious benefit for an organisation of our scale is the reduction in cash tied up in stock in the wrong stores, with intelligent auto replenishment we achieve a much more productive sell through of each of our campaigns.”
While bricks and mortar stores are still at the heart of the business, they recognised the importance of enabling customer interaction across various touch points. For the customers who wish to buy online this included the expansion of the e-commerce offering into more European markets – now in 22 countries, and for those who want to adopt a new digital journey in the stores Flying Tiger Copenhagen have a new mobile payment option on the Mishipay platform as a new innovative way of self-checkout on a mobile app.
Product development, ranging & sustainability
Flying Tiger Copenhagen’s product offering is made up of two categories. It has a fixed assortment of around 1,400 products that are always available in store; from candles to spice packs – as well as new and different campaign products that come into store every month. Product selection is based on relevance, uniqueness, and sustainability – often centred around seasonal moments and occasions.
Burke comments: “The rapid turnover of stock in our stores is one of the reasons to visit, as shoppers are also likely to find something new. However, we have also become famous for being the go-to place for all those key moments, like Easter and Valentine’s Day, so balancing newness with reliability is something that we need to get right for customers.”
While Halloween and Christmas were the top selling campaigns of last year, seasonality isn’t all that’s driving product innovation within the business. Burke explains: “A key pillar for us when we think about products is sustainability. Yes, because as a global business we care about the impact we have on the world, but also because our customers care about it too. People are waking up to their consumption habits and are actively seeking products that come from more sustainable sources and materials, so we need to cater to them to stay relevant.”
This has led to a reduction of plastic in the supply chain, sourcing responsible forestry products and using recycled materials.
Burke explains that the proportion of single-use items now sold by the retailer has fallen by 37% last year and that their Eco-Conscious product range now accounts for 31% of all products sold at Flying Tiger.
He says: “Our commitment to sustainability is something that’s really resonating with eco-active shoppers as many of us are looking to reduce our carbon footprint. We’ve made it easy for online shoppers to make more sustainable choices by adding an Eco-Conscious filter to their searches and we’re looking at how we can bring this into the store experience to.”
Flying Tiger Copenhagen’s sustainability credentials are also verified by their rating resulting in the EcoVadis Silver award they achieved in 2022 – placing the retailer in the top 9% of Variety retails for sustainability and top 25% for all global businesses.
What’s next for the business in the UK & Ireland?
Looking forward, the business is always looking to grow the retail estate in the UK and Ireland, but at the right pace in the highest footfall centres. Burke has just signed an agreement to take a store in Metro Centre, Newcastle, after recently opening in Manchester Arndale, Sheffield Meadowhall and Leeds White Rose in 2022.
Burke comments: ‘‘The focus on property costs and rightsizing the locations has been a one of the fundamental reasons for our success as we exit Covid and realise the new property landscape for retailers. We’ve needed to over index our time internally on this part of the business with strong property partners to ensure we’re fit and healthy on our property estate for the years ahead….my belief is that all UK retailers now must demonstrate a ruthless attention to detail on commercial property deals to guarantee longevity.”
