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    Lessons from Rembrandt: How to Survive and Thrive in Difficult Times

    17 Apr 2023

    After a tough start to the year for many New Zealanders, including those hit by the extreme weather events, the country's businesses are now bracing for the impact of an economic slowdown.

     

    Many New Zealand business have never had to trade through a recession, with more than half of ANZ’s business customers having started since 2009.

     

    Although each downturn and economic crisis is different, for those who have been in business long enough, the lessons they have learned along the way are critical.

     

    David Lyford, Managing Director of Rembrandt, one of the country’s leading menswear brands, offers his top tips on how businesses can survive and thrive through difficult times.

     

    Many New Zealand businesses are currently facing tough times – what challenges have you have faced in your time with Rembrandt?

     

    For a good 75 years, Rembrandt had been a New Zealand-based manufacturer, making clothes here and selling them to retailers in Australia and New Zealand.

     

    In the early 2000s it became evident the marketplace was changing, and that to succeed, we had to develop a retail network here in New Zealand.

     

    We could see that vertical fashion retailers – companies that operated both retail stores and sourced their own product – had a good track record of success.

     

    The trouble was that changes like this were going to be difficult to get right as the retail trade is a complex one.

     

    It also was increasingly evident to remain competitive, we had to move our production offshore.

     

    We were pretty convinced of our strategy, but it was a really big change in our business model, and a huge challenge to pull off.

     

    It took longer, consumed more cash and had a bigger impact on profitability than we anticipated.

     

    We had to hang on to our belief that it was the right thing to do and looking back I have no doubt that if we had not changed, we wouldn't be here today.

     

    We got through it, are very satisfied with the outcome and learned a lot of lessons.

     

    Speaking of lessons, are there any you would be willing to share? 

     

    If it’s not working, you have to be prepared to make changes.

     

    It’s like that saying: “you can't expect different outcomes or better outcomes if you're not prepared to do something differently.

     

    It's very easy to just kick the can down the road and think ‘it'll come right’, or blame the issue on the market, or your competitors, rather than look inward for the answer.

     

    Ultimately, when problems come up – and they will - you have to find a solution, make changes, adjust and learn. 



    "It took longer, consumed more cash and had a bigger impact on profitability than we anticipated.     We had to hang on to our belief that it was the right thing to do and looking back I have no doubt that if we had not changed, we wouldn't be here today."


    David Lyford, Managing Director, Rembrandt  

     

     

    When there is a tough decision to make, who do you go to for advice?

     

    There’s no question that you need the input of others. If you’re anything like myself, talking about problems and potential solutions with other people helps me understand what is needed.

     

    It is very helpful to have access from outside influences and of course from the wealth of knowledge within the business.

     

    Ultimately though, you have to work out what is right for the situation you are facing and make a judgement call, as not everyone you talk to is necessarily fully aware of all the circumstances.

     

    It’s also really important to have the support of key parties across the business - from shareholders, directors, customers, and of course your bank.

     

    If you are making big changes you need to take everyone involved in the business along the journey, no one likes surprises so being upfront early will do wonders when tough decisions are made.

     

     

    On a practical level, what are the kinds of things a business can do if it is under pressure?

     

    When a household comes under pressure, there are only a few levers to pull, whereas businesses have many more levers at their disposal.

     

    There are the obvious ones, like reducing costs, stock levels, capital expenditure and debtors as these have a positive cash impact.

     

    Some of the more difficult ones can include adding capital, or introducing new shareholders into the business – this was something we did which was beneficial on numerous fronts.

     

    In difficult times, businesses should be looking at each of these very seriously and be prepared to make the appropriate calls, and that includes investing in new initiatives. 

     

    One such example for us was the complete overhaul of the technology systems whilst we were in lockdown.  

     

    No small task to do remotely – but it’s been instrumental in helping the business through these tougher times and a great platform for our future.

     

    COVID has changed how a lot of people work, with many now working at home more. How has that changed the clothes that people are wearing?

     

    Track pants and sweatshirts were great when people were working from home, but now they are returning to the workplace there is a new expectation on their wardrobe.

     

    There’s no denying that feeling comfortable is at the core of what we wear and the shift back to the office hasn’t changed that.

     

    Whilst tailoring is part of our DNA – COVID has pushed us to be even more innovative in a space we know very well.

     

    We recently rolled out a merino ultra stretch suit that almost feels like you’re wearing a tracksuit, so far this has been picked up by our customers really well.

     

    Stretch shirts and blazers fall into this too and over the next few months you’ll start to see more of these comfort items in our collections.

     

    Another change we’ve seen since October is that events have returned - more specifically weddings.

     

    Brides and grooms can now book their big day with confidence. On top of this there’s been over 2 years of catch up. 

     

    This also includes corporate black tie events and we’ve seen a surge in these over the past six months too. It’s fair to say we’ve been busy.

     

    It’s great to know Kiwi men haven’t given up on suits, and still enjoy the opportunity to dress up when they have the opportunity to.

     

    Even in tough times, when there are difficult decisions to make, it’s great to be able to find opportunities to come together and celebrate, when we can.

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