PC Retail

Yoyotech is situated just of London's famous Tottenham Court Road and is a Mecca for hardcore gamers and tech enthusiasts. Product is piled from floor to ceiling on all the walls, creating a sort of Alladin's cave sensation, while the numerous sales people all exude techie zeal.

The shop is owned and run by CK, a PC industry veteran with his own views on what makes retailing work. He must be doing something right, because the shop seems to be constantly full and as a recent Coolermaster press event hosted by Yoyotech revealed, customers keep arriving well into the evening.

My first question is obvious: what's your secret? "Stay on top of the market," answers CK, immediately. "Where we score well is that I do keep my ear to the ground and find out what else is actually happening. I also ensure that our staff are fully knowledgeable.

"There's no room for error any more in this business and you can't really say 'I'll leave things until tomorrow.' Retailers really have to be on the top of their game at all times because if they're not, they'll lose. Having the right product means everything."

You can't argue with that, but aren't there a load of websites that have all the same kit without Yoyotech's overheads? "I'm trying to bring retail closer to retail," says CK. "It's great to have all these online shops, but often people want to touch, feel and see products, especially at the high end. Retailers give customers the opportunity to come in, see the product and talk to someone.

"A good 70 per cent of our business is still done by people coming into the shop. However, 95 per cent of those people have probably gone to our website first. For people who are passionate about technology there is an emotional element to making a decision. You wouldn't buy a car without seeing it first and it's often the same with our customers.

"The problem with the downward pressure on prices, exaggerated by the Internet and the likes of Dell, is that people forget about all the extra value and advice they're getting from retail and think only about price. If they buy from retail and there's a problem, they can come back in and get it sorted out. If they buy online they have to ship it back and that costs money."

The Internet is, as you would expect, something CK has given a lot of thought to. To him it's not necessarily an antagonist to the high street retailer. "The internet can also work in retailers' favour; our forums on Hexus.net work very well – providing big knowledge share for customers before they buy.

"Our customers visit a number of sites, but the majority of them will go to Hexus, which has a very similar viewpoint to ours. They talk about products and knowledge rather than just about price. On the print side PC Format and Custom PC are working superbly for us. I'm looking for quality not quantity from the readership."

Direct relationships

CK's approach to sourcing product may come as a bit of a wake-up call to the distribution community. "I prefer to work directly with manufacturers rather than distributors because I find they listen to me more than distributors do," he says. "Distributors are primarily concerned with selling boxes and often don't understand the product. We have to be very selective about which manufacturers we stock as we have limited space, so they need to be the best of our market and the manufacturer needs to understand our customer base."

"A reason we support Abit is that their RMA and service is absolutely fantastic. With Abit we have a service contract that means that if something goes wrong they will give us a replacement within three days. My first question when I'm negotiating with a new vendor is: 'what is your service policy'. If a customer has a problem with a component and the vendor takes 30-40 days to resolve it, the customer isn't going to say it's the vendor's fault – they'll blame us. So the key is not to promise service you can't deliver."

Not content with bypassing distribution, it seems CK wants to rival it too. "Retailers may not be able to develop a direct relationship with a smaller manufacturer, so in our new website we've got a volume discount offering where traders buying more than one unit will move onto a different price structure and increase their margin," he says. "We are also developing an XML link that will allow other retailers to display our prices without revealing their source."

Make your own pizza

In these times of £299 laptops it's refreshing to hear that Yoyotech still does very well out of the system building business. "That is our biggest way of making a sale," says CK. "The average build for us is around £800 for a base unit. A lot of people walk in and say 'I've seen this Dell system for £299,' and my staff concede that we can't compete with that price, but if you want to talk about motherboards, processors, etc then we can.

"When they see the whole selection of products on offer they actually go 'wow' and want to know more. Having arrived looking for a £300 system, the often leave having spent £800 or more and swearing at the sales guy for making them spend so much more than they intended!"

I can't let this claim go untested, so I tell CK I have £800 in my pocket and want to spend it on a base unit – what does he recommend? "If you've got £800 I'd go for a quad-core straight away, something like a Q6600 CPU, which is only about £170-odd pounds," he says. "I would put an Intel Abit motherboard in there, which is very overclockable, as I would assume that if you were spending £800 on a base unit you'd be a gamer.

CK proceeds to list all the other options available to me for my budget and I try to imagine having a similar discussion in PC World. The experience is vaguely reminiscent of a 'make your own pizza' facility and CK doesn't seem to object to the comparison. "You pick the toppings and we'll stick it in the oven for you," he concurs.

Ultimately, the secret of CK's success is knowing what he's talking about. This might seem obvious, but I don't really need to point out that it's not a philosophy shared by all retailers. "We have grown buy sharing our knowledge and service with our customers," says CK. "It's a big market out there and if a retailer can focus on retaining customers rather than constantly looking for new ones then they can build a good business out of that alone." Sound advice.