Papersmiths used a temporary shut down to push its ecommerce offering

Papersmiths spent 12 months updating its product mix and negotiating with suppliers to increase profitability. The business was on a solid footing and preparing to have its best year ever. Then the coronavirus crisis happened.

“We were going to make a really healthy profit and were excited about the online growth. We were quite pleased about how we were doing as a small independent retailer,” Papersmiths founder Sidonie Warren said.

Sales dropped in February and were getting worse every day at the start of March. Daily forecasting was crucial to managing the response and founder Sidonie Warren has used the opportunity to develop the stationery retailer’s online offering.

Information is crucial to responding quickly

Sidonie knew it was important to have access to as much information as possible. She created a daily cash flow forecast and tuned into the government’s announcement each night to see what support was available.

By mid-March, Sidonie realised Papersmiths would have to close its shops, giving her four days to work out how to close the brick and mortar locations. 

The whole team was put on furlough, including Sidonie’s co-founder. The government’s business rates relief will save Papersmiths £30,000 and three stores qualified for local authority grants. The business has also applied for the Coronavirus Business Interruption Loan Scheme (CBILS), but hasn’t had a decision yet.

Using the time to innovate

Furloughing Papersmiths’ staff, operating the business on her own and seeing the growth established torn to pieces has been stressful. But it’s given Sidonie’s time to improve the Papersmith ecommerce offering.

“I had recognised that I needed to dedicate more of my time to online. I also realised that by having online fulfilment in the same place as the marketing, I can see exactly what we have in the business and what we need to be talking about,” Sidonie commented.

In the future, the insight from ecommerce sales will help dictate what Papersmiths’ brick and mortar locations stock.

The knowledge economy is experiencing a work-from-home revolution. Sidonie said that remote working has highlighted opportunities for Papersmiths too. The company’s operations director will reduce the number of store visits, instead relying on video calls, freeing up their time to concentrate on online sales.

The opportunity to increase online sales

Pre-lockdown, five per cent of Papersmiths’ revenue came from online sales. However, ecommerce transactions were up 200 per cent month-on-month in April and another 200 per cent month-on-month in May. 

Growth is expected to taper off in June as people start to return to physical stores, and Sidonie is forecasting a ten per cent increase compared with May. But the focus on online sales means there’s less emphasis on needing stores to perform to support the business.

“We want to spend more resources on ecommerce. To keep our physical stores as places that you can come and experience the products, but make it more of a showroom for the online shop,” she said.

Online shopping has brought in new customers, many of which are based near a shop. Papersmiths is developing an incentivised click and collect function, so it can move people between online and offline sales.

“It’s not going to be ‘let’s throw open the doors and everyone will come in’. People will still be shopping online and some people will have made a permanent shift,” said Sidonie.

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