Using a Retail Target Operating Model to improve profit
An online wine retailer was keen to improve the commerciality of their approach and profitability of their results. Their CEO, who had a background in more traditional Buying, Merchandising, Planning and Commercial and had worked with First Friday before, approached us to work with his senior leadership team across all functions to develop the plan.

The Challenge
The business was enjoying significant growth, and the senior leadership team agreed that they needed to put the business on a more commercial footing but had differing views on what this meant and how to go about it.
As they all came from a variety of backgrounds, their understanding of traditional Buying, Merchandising, Planning and Commercial was extremely mixed, and the heritage of a membership-driven model was leading to some challenging internal debates about the future.
The Solution
Initially, we worked with the business to understand their current approach to Buying, Selling and Stock Control, which were internally recognised as being manual, labour intensive and siloed. We compared this to a high-level standard Retail Target Operating Model to identify opportunities:
- Planning levels for identification of opportunity/risk
- Top-Down vs Bottom-Up planning to deliver strategic intent
- Connections between stock and sales
- Clarity and effectiveness of meetings
- Effectiveness of KPIs
- Action orientation of Reports
- Visibility of risk and opportunities
- Organisational structure
- Process standardisation
- Openness of teams to change
We shared findings on each of these topics, first with the CEO and then with the senior leadership team, supported by tools, such as a Maturity Matrix, which enabled the business to understand their starting point versus leading retailers and the breadth of areas to address, aiding their understanding and alignment on the opportunities.
We provided the clarity and guidance to ensure senior leadership team alignment on the current situation, we then identified and articulated the questions for open debate and, crucially, what the root causes were.
Based on our prior experience and knowledge of the retailer we worked through 3 or 4 options for each of the questions with the associated pros and cons, adding examples and explanation to each topic as relevant.
Workshop facilitation
We then facilitated a full day session to help the senior leadership team work through their views on these “Big Decision” topics, enabling them to set the high-level principles that would guide the change.
Each Big Decision and our pre work was presented as a starter-for-10 and the group was asked to build on what we had identified. In some cases, we ensured those less familiar with the topics increased their understanding and asked questions in a safe environment, and in others, we flushed out strongly held views and what was underneath them.
We were able to challenge the pre-conceived beliefs in a balanced and open way going into the session and facilitate healthy debate between the participants, ensuring that all views were aired, that everyone was heard, and steps needed to progress the most complex issues to resolution were clear.
We documented these decisions, including, crucially, the reasoning and benefits behind them and a proposed a plan of action to address each of the topics, with indicative timelines and internal resource outlined, alongside a governance structure to maintain the open communication.
All of this work clearly set the framework for the development of the business and the wider team were engaged. We supported a 2-day workshop to drive out the detail of an operating model that was applicable to their business and aligned with the goals set by the senior leadership team.
Results
Our approach and support ensured progress was made on each topic and most of the “Big Decisions” that had been floating for a long time, were made, with clear reasoning and benefits articulated enabling the senior leadership team to authentically share the vision with their teams.
We also enabled the senior leadership team to empower their teams, because they had set the direction and had a clear reference for the aims, whilst the detail of the solution was in the hands of those closest to the task – with the result that the team were fully a part of the change and therefore much more open to it.
The team had the confidence to continue the process internally, knowing they can come to us for additional help when required.