Jan 2024

Leroy Merlin

Purpose

  • Since 2019, we have been partnering with Leroy Merlin, a leading Do-It-Yourself home improvement retail chain owned by a large multinational company.

  • We have been using the Economics of Mutuality methodology to shape strategy and management practices with a focus on stores in France and Russia.

  • The purpose of the project has been to support the company in fulfilling its meaningful challenge of ‘helping residents imagine and create the home of their dreams.’


Approach

Identifying stakeholders and mapping the ecosystem around the meaningful challenge:

  • Initially focusing on 15 stores in France – mapping their ecosystems and surveying 2,000 employees, 3,200 homeowners, and 1,300 contractors.

  • Measuring the links between store performance and levels of human, social, and
    shared financial capital among 3 key stakeholder groups: store employees, local homeowners, and local contractors.

  • The research showed that high human and social capital levels associated with a particular store significantly increased the likelihood of that store being commercially high performing (defined as market share corrected for competition intensity).

    • E.g., An employee with high social capital generated by trusting relationships with management and good prospects for career progression is much more likely to be working in a high performing store.

    • E.g., A local contractor with high social capital generated by a high level of trust in a store is significantly more likely to have purchased from a high performing store.

Informing strategic interventions to address key pain points:

  • The new insights led the company to focus more resources on certain initiatives.

    • E.g., Manager training and employee experience within stores.

    • E.g., An end-to-end solutions platform connecting stores and local contractors to meet the home improvement needs of homeowners, such as fitting a new kitchen.


Impact

Non-financial impact:

  • Improved trust and satisfaction within the Do-It-Yourself home improvement ecosystem.

  • Improved economic performance of key partners (e.g., local contractors).

Financial impact:

  • Improved commercial store performance, particularly for lower performing stores.

 

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