Spotlight on independent retailers: Psyche

You can’t talk about the best independent stores in the UK without mentioning Psyche. Based in the Teesside town of Middlesbrough, Psyche’s reach and reputation go far beyond its North Yorkshire borders, thanks to the drive and vision of its owner, Steve Cochrane, who set up the business 36 years ago and has built it into the leading retail destination it is today. Psyche’s flagship store is located in an imposing 40 000 sq ft building on Linthorpe Road – the former Uptons Department Store – with a more casual branch, Psyche 2, based in the town’s Cleveland Centre, and another store having been added in Durham in April 2018. This is complemented by a rapidly expanding e-commerce arm, which already accounts for 40 per cent of the overall business and which recently saw the launch of localised Psyche sites in the US and Australia. In his nearly four decades in retail, Steve Cochrane has won many an industry accolade, from best store to best store design and so on, but this was topped in November when he received the ultimate recognition – he was made an MBE in the Queen’s Birthday Honours for his services to the economy and regeneration of Middlesbrough. He tells FashionUnited what has been the secret to the lasting success of Psyche and why, despite a growing ‘empire’, he will always be an independent retailer.

First things, first: You recently received an MBE for your services to Middlesbrough. Did you expect such an honour?

I had heard a rumour a couple of years ago that I had been put forward for it, but ignored it, thinking that things like that don’t happen to people like me. It’s quite a long, drawn out process and takes about 18 months to go through. But when it turned out to be true, I was absolutely ecstatic. I know everybody works hard, but to actually be recognised for what you do - it’s fantastic. It was a very special day and is a great honour.

Earlier this year you opened a Durham store, your third Psyche location. How does it fit into your portfolio?

The whole idea of it is that it’s more premium than the main Middlesbrough store and the casual branch in the Cleveland Centre. All three stores are very different. Middlesbrough, at 40000 sq ft and with 84 staff, is huge; that’s a lot of mouths to feed, so it has to be commercial. But I wanted to achieve something a little bit more niche with the Durham store; it’s a bit more experimental where we can try out new things and introduce up and coming new brands and designers. For this store we go digging around Paris and London Collections Men, that’s the concept of it. Durham has a lot of wealthy students and generally a demographic that fits the bill. It’s going well, although it hasn’t as yet done what we projected it to do, because we opened in the worst year possible. We’re a couple of doors down from a Marks & Spencer, which closed just before we opened, literally while we were kitting out, which had a big knock on effect on the high street. And there were a few more stores that also closed, which hasn’t helped and made the whole environment a lot more challenging. But once the retail landscape settles down a bit, things will stabilise again, I’m sure.

How many brands do you sell and what is your buying strategy?

At the flagship store we carry over 203 brands across all of the departments, including womenswear, menswear, childrenswear, tailoring, accessories and lifestyle products, and separately we have a number of shop-in-shops, such as Barbour, Ralph Lauren and Paul Smith, which also add a lot of appeal, as they are fitted out by the brands like their own stores and therefore really stand out, which is great and exactly what I want. With so many labels, it’s of course a massive challenge to buy and my team are always out and about sourcing and looking at labels. I want the Middlesbrough store to be the regional destination for as many brands as we can. In addition to our core brands, we add and drop every season, because brands have a certain lifespan, some work, some don’t. You’ve got to keep adding things all the time. But that’s exactly where the Durham store comes in; the whole idea of Durham is to trial things in there on a smaller scale, and then, if they work, put them into Middlesbrough.

How do you ensure that, as the Psyche portfolio grows, it still retains that independent character?

We give fantastic customer service. I’m an incredible stickler for that and we train our staff accordingly, it’s a huge emphasis at Psyche. We do staff training every Monday morning and really hone in on that to ensure consistency across all our departments. I want Psyche staff to always have a smile on their faces, carry items back to the car for customers, wrap things nicely in tissue paper, know the names of our top 100 customers - just go all out for customers and be very personal. It’s about those small details, but which really define the character of a store. If you go into a lot of multiples, you’re quite faceless, staff are often indifferent towards you. We go out of our way to be the opposite to that. Good old-fashioned customer service, basically.

It’s just over two years ago that you significantly extended your head office to accommodate your online growth. How is your e-commerce business performing?

Our online site is growing like mad. We’ve launched a fascia in America and a fascia in Australia. America is going really well, Australia is still a bit quiet, but we’re getting there. Everything is handled from the Middlesbrough headquarters. It presents its challenges, but we continue to grow. By 2020 I’d like to see the web business move to a big industrial estate somewhere because we’re simply going to outgrow our current set-up. Our retail turnover online makes up 40 percent of the overall business. In 2017 it grew by 46 percent. This year we had a few software problems, and we’re only about 11 percent up on last year. But we’ve solved these issues now so we think that we will continue to grow by about 20 percent at least next year. By some time next year, Psyche online should constitute 50 percent of our overall turnover.

Are you finding it difficult to translate the Psyche ethos online?

Yes, we struggle with that. It’s very difficult. You walk into Psyche - it looks amazing and is exciting. You go on our website, and it looks ok, but it’s nothing like the store, we haven’t quite managed to crack that yet. And we’re aware of that. We know that the excitement and passion that comes across in the store isn’t prevalent on the website as much as I would like it to. We have that many garments to do the description on, we don’t write with the same kind of quirkiness or passion. So we know that we still need to improve that and it’s a continuous work in progress. Investment in our online technology and customer experience will continue to be a big focus for next year. With all that said, we mustn’t forget the backbone of the business, which is still the bricks and mortar store. There are some people who will just never shop online. And personally, I definitely don’t get the same sense of satisfaction online as I do from the store. If you get a big order online, say, for 1000 pounds, I don’t get the same sense of excitement as when I see a guy going out of the door of my store with lots of bags, having spent the same amount of money. It’s more tangible.

Do you have an ultimate vision for Psyche? Or do you always seize opportunities as they occur?

We used to have business plans, but things change so rapidly, they’ve ended up being a waste of time. So I’m just taking things as they come, making sure that I have a contingency and am in a position to take advantage of any opportunities. I don’t want to get too stretched though. It’s so easy to do. But I’ve never been scared of risks either. I like risks. Risks are exciting. They usually pay off in the end - obviously some more than others. Having a business is a bit like gambling, the same intense highs and the same intense lows. When it goes your way it’s mind-blowing, and when it doesn’t, it’s like you have the weight of the world on your shoulders. When I bought former Uptons department store and turned it into Psyche, I had to sell my house and my car and put my whole livelihood at stake, but I believed that it would pay off. In the 36 years I’ve been running the business, there’s been plenty of highs and lows, plenty of risks and knock-backs, but you come out the other end, and you carry on. That’s what retail is about.

How do you define the Psyche USP? What’s kept you on top of your game for such a long time?

Probably the fact, that the passion and drive that I have is also shared by most of my team. Quite a few of them have been with me for a long time, the longest serving member of staff for 28 years, and many for more than 15 years. They have the same ethos as me. And I think getting that and being able to have a team who ‘get it’ is very important. Finding the right people is paramount. We are very very fussy at interview stage. I believe having a team that share your vision is what ultimately defines us and makes us stand out.

What do you see as the key challenges for independents at the moment?

I’d say working capital and cash flow. To be in a position to pay wages and pay suppliers and keeping a tight handle on the management accounts and finance is a continuous challenge. Finance is more important than anything else.

What do you see as the biggest opportunities?

I would say it’s the fact that as indies we can move quickly, we can make decisions instantly. So when an opportunity comes along, we can decide straight away.

What lessons have you learned in 36 years in retail?

You have to be passionate about it. Give it 110 percent, because you have to. In the early days, I worked round the clock, a lot of hours; it’s relentless and demanding. Never give up, keep trying. Totally absorb everything there is to do with the industry, always keep training yourself and keep learning. You can’t sit still.

With three stores and a thriving e-commerce arm, do you still see yourself as an independent?

Absolutely. I totally and utterly see myself as an independent, that won’t change. The Middlesbrough store is not just a business, it’s a labour of love for me. I absolutely love the building, I love shopfitting it, I love doing things to it. And I do it, not necessarily because the store needs it, but half the time because I want to change or want to keep it fresh and vibrant. A bit like a theatre set, I like to create that same sense of excitement - retail theatre. I love the retail business, it’s completely under my skin.

What’s next for Psyche?

I wouldn’t rule out opening another store in 2019, because lots of stores are closing and the landlords are actually being quite realistic, so if I can get a good deal, then I’d like to open somewhere within a one hour radius from Middlesbrough. I’m going to keep my ears to the ground and if I think there is a decent unit somewhere, on decent terms, then I will think about it seriously. And tweaking and expanding our online space will take up a lot of our energy and investment going forward. We always keep moving.

Images courtesy of the brand