Hugh Rice is on track to open five more stores in the next three years, its leadership team of managing director Paul Rice, and sales and marketing director James Rice has revealed to WatchPro. On a tour of three of the company’s stores in Hull and Beverley, the cousins revealed a detailed plan to expand their estate, secure prime locations that suit their business model, train their teams to become the very best in the industry, and ultimately lure the world’s finest watch brands into their portfolio.
Hugh Rice already operates four stores, each with unique business models tailored to their environment. In Beverley, an attractive market town in East Riding of Yorkshire, Hugh Rice has two shops. The first is simply Hugh Rice, a mid-to-high end jeweller specialising in fine jewellery and stocking watches including Tudor, TAG Heuer, Breitling and Omega. Just around the corner is the first LUXE by Hugh Rice shop, which houses fashion brands including Olivia Burton, Hugo Boss and Michael Kors.
Hugh Rice in Harrogate, the most affluent town in North Yorkshire, caters mainly to the upper end of the market with a similar portfolio to the Hugh Rice in Beverley.
By far the largest store in terms of square footage and turnover is Hugh Rice in the St Stephens shopping centre in Hull. The company opened its first store in the mall in 2008, having outgrown its founding location on George Street, a commercial street that Paul Rice says dropped from an ‘A’ location to a ‘B’ or even a ‘C’.
The move into St Stephens took place just ahead of a time of even more frenetic activity for Hugh Rice, but not so much in its traditional jewellery and watch business. The company was an early stockist of Pandora jewellery, and made the decision to invest heavily in building a partnership with the Danish brand.
A Hugh Rice store in Whitefriargate in Hull’s old town had opened in 2006, but was converted to become a Pandora concept store in 2009. This was quickly followed by the opening of a second Pandora store in Sheffield’s Meadowhall One shopping centre the same year. Over the next five years, Hugh Rice opened seven Pandora concept stores, making it the largest franchisee in the North East.
Pandora hasn’t only added turnover to the business, it has given Paul, James and the team invaluable training in business processes. “Our dealings with Pandora in terms of how they are set up, their structure and how they operate has been inspiring to us. It was probably one of the first brands to involve themselves in every element of our business … selling the jewellery, the visual merchandising, the marketing, stock procurement, the analysis that went with it, how they approach their campaigns, even how they run in store events. It was all incredible,” says Paul Rice.
Pandora is credited by a great many jewellers for helping them survive the economic turmoil that has flowed from the financial crash in 2009. There is little doubt the shift into Pandora helped Hugh Rice a great deal more than that, but Paul and James point to the expansion of its St Stephens shopping centre store for transforming its watch business. The expansion took place in 2012, with Hugh Rice taking over a unit adjacent to existing shop in the mall. The doubling of space led to a massive redesign that divides the store into different zones that appeal to different customer desires.
“Opening up the neighbouring unit in Hull [doubling the size of the Hugh Rice store in Hull’s St Stephen’s Shopping Centre] was key,” recalls Paul Rice. “Before that, it was a lack of space that was holding back the performance of some of these brands. With the extra space, we could allow all of our brands to flourish. A natural separation could develop between watches at different price points, so Swiss products could live in their natural environments,” he adds.
St Stephens has created a template of a successful Hugh Rice that the company would like to replicate for at least some of the stores it plans to open in the next few years. The expansion is part of a five-year plan devised by the business in 2015. “According to the plan, we will have an additional five stores by 2020. We have a couple of locations that we are very close or have already agreed on. The absolute ideal is stores like the one in St Stephens shopping centre, but we will see,” says Paul Rice.
However, if locations can’t be found that allow for brands with different target markets to co-exist under one roof, then Hugh Rice will look at whether a LUXE by Hugh Rice in the same city as a more upmarket Hugh Rice could be appropriate.
That separation is something that many of the top Swiss watchmakers prefer, and could lead to Hugh Rice climbing the ladder towards previously unattainable brands. Paul and James do not want to give the impression they are dissatisfied with their current line up, but do concede they are continually trying to develop the business and, “We are receptive to improving our portfolio,” says Paul Rice.
Ultimately, it is the customer who will influence what brands Hugh Rice stocks, and how they are sold. The key is to have the environment ready to capitalise on every opportunity. “We have clearly identified the areas of the market in which we want to operate. If we are approached by any brand, we should have the retail vehicle for it,” says Paul Rice.
Hugh Rice is egalitarian when it comes to watch brands and watch technology. The company is a huge fan of Fossil watch brands, and has been particularly successful with Michael Kors smartwatches this year.
James Rice believes smartwatches won’t damage sales of traditional watches, and have the potential to create a whole new customer base. “We see it as another opportunity. It is a bit like the Michael Kors affect on ladies’ watches – creating a customer base that barely existed before. Smartwatches might create another new customer base. It will be interesting if we can capture those customers and turn them into Hugh Rice customers,” he suggests.
He is determined that jewellers like Hugh Rice don’t miss the smartwatch boat and allow the technology or mobile phone retailers to own the market. “At the moment it is unclaimed territory, so why wouldn’t retail jewellers grab it?” he asks.
Even expensive smartwatches are selling well at Hugh Rice. “The success of TAG’s Connect this year proves there is demand. Whether that price point of over £1000 will be a big part of the market, or whether more entry level prices will sell best, we don’t yet know. It is all new,” says Paul Rice.
Ensuring that products are easy to find for every customer, whatever their budget, is central to the Hugh Rice method. The company recently conducted market research with its customers to find out whether they wanted brands with different price points to be segregated. The answer was a definitive no. “It was very interesting looking at the results of our customer study into what and how they buy. We did not have anybody complain about the way that value brands in one side of the store co-exist with luxury brands in the other side. If anything it is the opposite. Customers are very interested in both,” reveals James Rice.
That said, the company does think it is important to create the right environment for each brand. “We have to create the right environment for both the customer and to meet the expectations of the brands. That is one of the reasons that we invested so heavily in creating LUXE, which gives a unique environment for the brands that would not work so well in Hugh Rice,” Paul Rice explains.
Hugh Rice knows that creating the right environment is only half the battle. The back end systems and customer-facing staff have to be just as strong. Training the team is an obsession for Paul and James, and they hungrily accept any courses offered by the brands they sell. “We are one of the biggest consumers of training within the industry,” says James Rice.
To ensure the company stays ahead, it created the Hugh Rice Academy as part of its five-year plan. Initially created in the form of traditional training courses, the business is now taking the whole thing online, and turning it into a highly structured programme that will develop employees at every level. “The academy will be an online resource by the end of 2017. We aim to have different levels that people can work towards: silver, gold and platinum that our colleagues work up to,” explains Paul Rice.
If the five-year plan is executed in full, Hugh Rice will be running nine of its own stores by 2020 in addition to the seven or more Pandora franchised outlets. It will have the best-trained workforce in the business, which Paul and James believe will also mean the most motivated and loyal colleagues in the sector.
If that all leads to new opportunities opening up with some of the most sought after Swiss watch brands, then the cousins will certainly embrace them. If it doesn’t, you will see Hugh Rice continue to thrive with the desirable line up of brands already within the portfolio.
HUGH RICE HISTORY
1971 – Hugh Rice the Jewellers opens on George Street, Hull
1988 – Hugh Rice branches into the retail sector and moves to a larger store on George Street
2000 – New store on North Bar Within, Beverley, opens
2006 – New store on Whitefriargate, Hull, opens
2008 – Hugh Rice moves to their new home in St. Stephen’s Shopping Centre, Hull
2009 – Whitefriagate store transforms into Hugh Rice’s first Pandora concept store, and Pandora Meadowhall One opens for business
2010 – Pandora Leeds (Briggate), Meadowhall Two and Harrogate stores open
2011 – Whitefriargate Pandora store is refurbished to give more shop floor space
2012 – Hugh Rice extends St. Stephen’s store with a dedicated Fashion Brand department
2013 – Hugh Rice opens second Pandora store in Leeds within the prestigious Trinity Shopping Mall
2014 – Pandora Bradford and multi-brand Harrogate store open their doors for customers, and Luke Campbell signs sponsorship deal with Hugh Rice
2016 – LUXE by Hugh Rice opens in Beverley, East Riding of Yorkshire