ECRM European Buyer Q&A: Peter Mudahy, Pak Cosmetics 7/11/2019
Pak Cosmetics is one of the largest multicultural beauty retailers in Europe. Based in the UK town of Harlow, the company has 35 stores in London, including several My Hair and Beauty prestige outlets, which include salons. It also has a thriving e-commerce business with more than 100,000 square feet of warehouse space to support it.
Pak’s CEO Peter Mudahy has been attending ECRM’s Euro Beauty sessions for several years, and relies on them to find innovative products to address his shoppers changing needs. During our most recent Euro Beauty Week sessions in Prague, ECRM VP of Content Joseph Tarnowski spoke with Peter about beauty trends in the market he serves, the increasing role of digital, and how he leverages ECRM to help discover the products he needs to optimize his assortment.
ECRM: Tell us about your company.
Mudahy: We are one of the largest multicultural beauty suppliers in Europe. We built our business over the last 40 years, and have 35 stores in London with a very strong brand. We've always been known among the Afro-Caribbean market and the African American market selling hair relaxers, shampoo treatments and so forth, and over the years we've seen our audience expand to the Caucasian market as well. So it’s great to be able to come to an ECRM session where we can find the right kind of products to fill that gap in that market that we wouldn't normally service.
ECRM: What size range are your stores?
Mudahy: Our smaller stores are about 3,000 square feet, our largest one is about 10,000 square feet, but we're wall to wall packed with beauty products. We sell hair care, skin care, extensions, wigs -- products from your mass market items all the way up to salon professional items and prestige skin care. The PAK brand is synonymous with multicultural beauty and for being a one stop shop for everything you need. The stores service about 60,000 customers a week, and we also have an online business that ships an average of 1,700 packages a day. We've got another brand as well called My Hair and Beauty, which focuses on more of the high end. So we've got the PAK Cosmetics stores, and My Hair and Beauty stores. PAK handles mass market and a little crossover. My Hair and Beauty handles all of your higher end hair care products, and is a salon as well.
ECRM: Has your online presence helped fuel your growth?
Mudahy: I think online complements our business incredibly well. If we didn't have the online presence, I don't think we would really have a business today. But what we've noticed is that people come in to our stores, they'll spend an hour and a half, maybe two hours checking out the products, and then they'll go home and buy online. The stores in a way become like showrooms. But then if you didn't have the stores, the online business wouldn't be as great. We did a pilot program with Google a few years ago, which examined where our online customers are, a lot of them live around our stores.
ECRM: To that point, are you focusing on the experiential aspect in the stores?
Mudahy: I think a lot of the decision making process to buy products still happens in stores. It hasn't shifted yet to an online-only environment. No doubt at some point it will and we obviously see videos influencing a lot of product purchases. But the people still like to touch, feel, get involved, have a relationship with the product that they're buying. And you can only do that in store.
ECRM: Do you do a lot of demos in stores?
Mudahy: Our stores are really packed, so we don't really do demos. We have promotional activities. We partake in a show once a year called the Afro Hair and Beauty Show in London, where we pack 12,000 people in to a massive hall and we sell space to brands from all over the United States. A lot of the suppliers here at ECRM participate. The guys that organize it do a fantastic job, and they have a consumer magazine as well. So you've got supply, you've got advertising, you've got marketing. And then we'll leave the B2B stuff to you guys. But for us it's not just about being a retailer, or being a beauty supplier. It's being part of the industry and helping to shape where it's going. And to give that consumer the whole experience.
ECRM: So what overall trends are you seeing in beauty category, specifically in the markets you cover?
Mudahy: People are becoming very conscious about packaging. They're looking for recycled packaging, they're looking for innovation. For example, how do you put a wet product in something that's not a plastic bottle? Glass is expensive and it breaks. There are different types of plastics.
Then there’s bamboo; people are looking at bamboo but it's expensive. I've just recently this week seen one of the suppliers here with some recyclable packaging. But the consumer also has to understand that some of these innovations cost a little bit more.
The other thing is natural or organic products. Everybody wants to throw the word organic around without realizing there's a membership to that. So understanding naturally derived, understanding what the ingredients are. A lot of our job is to educate consumers so they understand what they really want, because at the end of the day they want a product to work, too.
ECRM: So you've been coming to ECRM sessions for six years – what was your focus at this year’s session?
Mudahy: We're looking at new products and new innovations for online. We want to try to build our online profile. The thing with our online business is that, you've got to have brands that people recognize or ticks certain boxes and then promote that to your audience so that they come and click on it. It's not like a shelf where you can put a product on and somebody's eyes go to it. With online businesses you have to drive people to that page, and that takes a relationship with both the supplier, the product and the retail environment. Everybody has to play a role in that. So coming to ECRM sessions where you have that direct relationship with not just the products themselves, but also the people behind them, you get the full story, the full message. You share the passion, you bond, so that you can deliver a really, really good service to your end consumer.
Coming to ECRM sessions, where you have that direct relationship with not just the products themselves, but also the people behind them, you get the full story.
-- Peter Mudahy, Pak Cosmetics
ECRM: How do ECRM’s account managers work with you to curate an ideal schedule of meetings for your business?
Mudahy: They're my boss (laughing). They'll work with me two or three months in advance to find out what we're looking for, what categories, what we're not looking for. Based on that they'll send me a schedule of suppliers. You get a chance to do research and revise it based on their recommendations. They give you some feedback, you've got plenty of time to plan to plan. Then you have these iPads [with the ECRM Connect App] and everybody's schedule is on there, and you can snap photos with it, include business plans, presentations and so on.
ECRM: What products have caught your attention here this year?
Mudahy: One in particular was a shampoo bar. So for those people who don't want to buy plastic they make shampoo bars that'll reach them. There is some natural skin care and hair relaxation products as well.
ECRM: What about the networking functions at ECRM sessions? What kind of value do they deliver for you?
Mudahy: The good thing about ECRM, the environment that you guys create, is that everybody's relaxed. There's none of this rivalry thing. Everybody bonds. I get to see competitors. I get to see friends. I get to see people I'd like to do business with. And everybody's introducing everybody to everybody. So I think they're really key to complement the business meetings throughout the course of the day. And that's great, because we're all in the same industry. We all want to move forward, so why not create that kind of an environment. You can always learn from somebody else, even if they're a competitor. I've heard many times, especially on the supplier side, they are learning as much from other suppliers as they are from the buyers.
Full video: ECRM's Joseph Tarnowski and Pak Cosmetics' Peter Mudahy