18 SEPTEMBER 2002
Marika Azzopardi speaks to The Catalogue Company Managing Director Paul Stoner who distributes, amongst others, the industry-leading La Redoute catalogue forming part of the worlds largest non-food retailer. With sales this year exceeding Lm1.5 million, there can be little doubt that the company has found a formula for success
Imagine the ease of roaming through the wares of a multi-storey department store, continuously discovering new items, their prices and the full gamut of individual selections while merely sitting on your own sofa in your own front room. No queues, no traffic, no unhelpful shop assistants - that is the concept behind The Catalogue Company Ltd.
The concept of catalogue shopping in Malta has taken off in a steady, reassuring manner, especially since TCCs managing director Paul Stoner launched the company some 10 years ago.
"This is a virtual warehouse with a very big product range about 200,000 diverse products on sale. TCC presently encompasses various catalogues including La Redoute, Betterware, Studio and RS Components International."
The four catalogues cater for four distinct categories of shoppers, although Mr Stoner explained how in Malta the purchasing power in the household lies in the female hands female. Subsequently the majority of the catalogues are actually female oriented.
"Women here are extremely important within the family context. They love to be well dressed, they purchase clothing for themselves, their children and even their husbands. They decide and ultimately they hold the purse strings firmly in hand," Mr Stoner explains.
Before introducing the La Redoute catalogue to Malta, Mr Stoner had taken into account the fact that the English fashion did not seem to reflect the Maltese females natural Mediterranean inclination towards voluptuous lines and ultra smart clothing, Italian fashion had somehow lost its impact on the local market. French fashion seemed the answer, a revelation that led him to introduce La Redoute to Malta.
The catalogue supplies 50,000 lines of French fashion clothing and footwear and attracts mostly domestic customers. La Redoute is in actual a division of Frances major retailing company Prinault, Printemps, La Redoute, which has become the largest non-food retailer in the world.
"The catalogue represents half of our business bulk. In Europe La Redoute is a premier shopping catalogue. We have customised the catalogues to cater for the Maltese market, but although the catalogues are extremely expensive to produce, we believe in the dictum free catalogues, free delivery, free service," Mr Stoner says.
He also commented on the changing trends of Maltese women, who up to 20 years ago still visited Valletta to do their shopping, which lasted a full morning.
"Nowadays a great deal of women work full-time and as such they simply dont have the time to carry out their shopping at ease and in tranquillity. Time and parking facilities is limited. Then again, shops these days are so numerous that taking a final decision on what to purchase may take even longer."
The catalogue system has suited this change in lifestyle, especially since catalogues are delivered free of charge, goods ordered are delivered free of charge and returns are also accepted.
The diversity in products has gained the catalogue its very own identity among the Maltese, as has happened in Europe. In France 80 per cent of women purchase their lingerie from La Redoute. But there is a massive choice of childrens wear and while the catalogue covers all price ranges, it also houses big brand names whose products are even cheaper than what is available in the shops.
"Today we still have several protective levies which hike up prices. For instance, a branded pair of trainers may cost $10 which include a large $2.50 worth of levies. There are duties, VAT, customs expenses and the lot. With Maltas inclusion in the EU, some of these may be lifted and this will ease prices and enable an even greater flexibility in product choice."
TCCs managing director believes that high standards in service go a long way towards having turned the business into a success.
"We have taken the consumer laws on board and we offer a guarantee to cover all products for 12 months. Replacements are carried out without questions and the customer is always right. Sales are also gift driven and we have periodic offers coming out every four to six weeks."
A staggering 75,000 orders meted out as against the mere four complaints lodged in during 2001 surely prove the criteria cannot be wrong.
Mr Stoner explained that while returned goods are the companys biggest hassle, he has, rather ingeniously, discovered an effective manner in which to dispose of them.
"Returned goods make up 30 per cent of sales. We quality check them and keep them as current stock, which may be re-ordered by other customers. Whatever is left over at the end of the season is presented to our customers in the form of a big sale held at a central hotel. At our last big sale was held in Floriana, for which we had huge crowds and could only take people in 400 people at a time. We manage to sell, at a huge discount, at least 90 per cent of the stock."
The other catalogues, while not quite as prominent as La Redoute, still have their own aficionados.
The Betterware catalogue supplies 700 varied products including household hardware and cleansing products. The small booklet enjoys seasonal changes such as summer accessories for the beach or garden tools for a busy autumn. It is supported by a network of licensed distributors who deliver the catalogue to between 15,000 and 20,000 homes throughout Malta and Gozo, with a different copy being issued seven times a year. The system depends on regional co-ordinators who keep track of distributors and their orders.
The Studio catalogue, meanwhile, offers 6,000 lines of the Fine Arts giftware and home furnishing. Once again a great emphasis is made on seasonal changes and the latest issue focuses on Christmas decorations, presents and the like something to suit everybody.
Paul Stoner flicked through the latest Studio publication, which comes from one of the largest UK companies - operating in 150 countries and producing material for institutions such as Oxfam and RSPCA. A novelty for this season is a series of giftware choices that can be personalised to individual taste.
The fourth catalogue is highly specialised. RS Components International provides 130,00 lines of electronic, electrical mechanical, health and safety products to business customers.
Mr Stoner elaborates, "This is the bible of engineers, maintenance technicians, laboratory assistants, manufacturers and lecturers. Through it we supply factories, hotels, state companies, corporations and the like. We have a very well established clientele with over 100 customers. Big businesses rely on our efficiency to process orders immediately and carry out delivery within 48 hours."
Mr Stoner stresses that TCC uses local service contacts, such as Air Malta and Express Trailers, to ship roughly 100,000 kilos of goods every year.
"During 2001 our sales reached Lm1.55 million, of which 30 per cent was to business customers and 70 per cent to domestic customers," Mr Stoner explains.
The Catalogue Company is fast approaching its 10th anniversary in March 2003. TCC employs only 20 people on its premises, but nearly 400 representatives all over Malta and Gozo. To help support this network, the company has made a massive investment was made in information technology.
According to Mr Stoner, "We have the first absolutely interactive website and we are about to receive the Best Business to Business Software award. All software was designed by our very own IT Department and this, together with specifically designed websites, are used throughout Europe by other major catalogue companies. Catalogue Soloutions has been operation since 2000 and is an international solution provider to the mail order business."
All said and done, Mr Stoner feels concerned about how the disposable income available to households has shrunk over the last 12 to 18 months. "This only means that we have to work harder. The catalogue business is not the easiest business to run and we do not have big profit margins. But when orders are steady, we can go ahead and plan towards expanding the present product range."
Paul Stoner arrived in Malta some 15 years ago following his retirement from a very successful experience in the UK property business. He married locally and started a real estate company, but eventually decided to try out his business acumen in the catalogue business, which he felt, at the time, warranted a boost in Malta.
From what has transpired over the past years, it is very apparent that his hunch was completely correct and that he can now look forward to branching out into more modern selling technologies such as teleshopping.