Forecourt Trader
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Chiller instinct

27 June, 2011
Chilled foods are a key component to a successful forecourt store
Page 30 

According to the Institute of Grocery Distribution's Convenience Retailing 2011 report, chilled food was a star performer in forecourt stores last year.

Senior business analyst, David Shukri, comments: "Chilled food was the third fastest-growing category in convenience forecourts last year, behind soft drinks and tobacco. Fruit and veg did not grow last year in forecourt stores and remains largely under-represented within this segment of the convenience sector."

Shukri says that in order to remain competitive in the future, forecourt operators must continue to evolve and diversify their product ranges. "This will mean further investment in their fresh food offer as well as expanding their existing chilled food ranges. Operators such as James Graven highlight how this is possible and the joint work between BP and M&S Simply Food is also helping change perceptions of the convenience forecourt offer."

Stocking fresh produce can be a headache for convenience retailers, however Spar wholesaler Capper & Co, reckons it has the answer with its Market Garden range. Launched last September, Market Garden is all about selling good-quality, locally-sourced fruit and vegetables in case sizes that work for convenience stores.

Capper's produce manager, John Penquet, explains: "Market Garden has been very well received, so much so that our fresh produce sales are up 21% year-on-year. The range is geared to convenience stores, offering smaller case sizes for a quick turnover to maintain freshness."

There are typically 120 SKUs in the range but it does vary by season. Although vegetables sell well, Penquet says the star performers so far have been fruit. "Singly-priced apples sell well as snacks, as do bananas, and retailers can buy just 28 bananas in one box."

Capper is strong on offering 'round pound' deals so Market Garden includes bags of produce for just £1 things like stew packs or bags of apples.

Penquet says prices are competitive Capper regularly benchmarks against the grocery multiples. There's a 24-hour lead time on deliveries and typically stores get between two and five deliveries a week depending on their size.

Capper's head office is in Wales so it uses local growers there. However, it services Spar stores in the South East too so sources produce there as well.

"We do offer regional ranges as well," says Penquet. "For example, we offer Welsh cauliflowers for our Welsh stores and English ones for our English stores."

Hygiene benchmark

There's no doubt that stocking chilled lines takes more time and effort than stocking cans of beans or soup. There's the chillers themselves to consider and adhering to food hygiene legislation before you get onto what to stock, but all the evidence suggests that the chilled category is worth the investment.

Dairy Crest shopper marketing manager, Adam Mehegan, says chillers must always be clean, as they are the "hygiene benchmark" for any store.

"Overall, keeping the chiller regularly stocked, replenished and visible are 'must dos' to ensure convenience stores drive footfall and have a strong hold in what is a highly competitive environment. Availability must be 100%, particularly when customer demand is highest. Research shows that if a product is unavailable twice in a row then shoppers will look elsewhere, permanently.

"Older stock should be pulled forward and date codes must always be rotated. Short dated products should be cleared away, not marked down as this sends out the wrong message."

Dairy Crest is the company behind Cathedral City, the top-selling branded cheese in the UK (Nielsen data). Worth £18.5m in the convenience channel, Cathedral City is bigger than its next three competitors combined and one in two homes have a Cathedral City product in the fridge. Dairy Crest is investing £7m in growing the Cathedral City brand in 2011, including a heavyweight TV campaign.

Mehegan advises forecourt retailers to stock only one pack size per cheese type, as well as just one brand per type. "A wider range of cheese will allow you to meet a higher number of shopping missions and usage occasions in the home," he says.

He adds that consumers are becoming more adventurous, expanding their repertoire and trying new cheeses. Dairy Crest introduced trial size packs to support this trend. "Our 80g packs of Cathedral City Mature, Extra Mature, Mature Lighter and Vintage 20 encourage shoppers to try something different, and then trade up to the full-size pack." When it comes to price, Mehegan advises retailers to consider price-marked packs (PMPs).

"They are proven to increase category sales as 48% of shoppers say that PMPs encourage them to purchase that product and 95% of retailers believe that PMPs communicate value to their customers." (source: Him Convenience Tracking Programme).

Both Cathedral City Mature and Extra Mature 200g are available in price-marked packs.

When it comes to butters and spreads, Dairy Crest offers Country Life, Clover and Utterly Butterly. According to Nielsen data, within convenience Country Life is the fastest-selling British butter brand.

As the only major British butter brand on the market, Country Life is building on its provenance and taste credentials throughout 2011 with a £4m marketing spend. The Country Life Great British Picnic campaign began last month, allowing consumers to download an app to help plan the perfect picnic.

Meanwhile, Clover is backed by a £6m investment in 2011, including TV ads.

Mehegan says stocking the top brand butters and spreads is crucial: "This is a brand-rich category where consumers buy into the names they recognise and trust. Shoppers are willing to pay more for branded products providing retailers with an opportunity to maximise the value of every butters and spreads sale."

Milk is still the cornerstone of any c-store's chilled offer. It doesn't matter where your store is situated you need to stock milk. However, because it's been around forever and hasn't changed much over the years, it's something that can often be overlooked.

Robert Wiseman Dairies is dealing with this through its 'On the Hour Every Hour' initiative, which encourages c-store staff to complete hourly checks to ensure that their milk fixture is being maintained to maximise the store's milk sales.

For participating stores, the company has developed a clock which will on the hour, every hour moo just like a cow to act as a reminder to store staff to complete these essential checks. Wiseman's sales and marketing development manager, Barry Cuthbertson, comments: "A milk shopper is a valuable customer as they tend to purchase more than just their milk and visit more frequently. This is demonstrated in the latest Him Convenience Tracking Programme (CTP) findings which show that a milk shopper spends on average £6.95 per visit compared to the CTP average shopper spend of £5.47." (CTP May 2011).

Cuthbertson advises forecourt retailers to use point-of-sale material at various locations around their store to communicate to customers that they have fresh milk available. He also says retailers can maximise sales by putting the larger size products such as two-litre bottles within easy reach in the eye-line of the consumer.


Retailer view

Bishop Retail's Mace Red Tiles Service Station in Durham, has been developing its fresh produce range. Operations director, Darren MacDonald, says a 'try before you buy' scheme on fruit and veg has helped build customer confidence and sales: "Just as when you are in a restaurant you try the wine before you drink it, here you can try the fruit and veg before you buy it. So if a customer is looking at the grapes, we encourage them to try one and say 'If you like it, buy it'. This happens on things like apples too. Invariably they will go on to buy the items. For example, they'll take a bite out of an apple and buy that one and three others as well. Some customers look at you as if you are silly, but we need them to try things to show that we are just as fresh as the supermarket. It doesn't really cost us much so it's well worth doing."

At the moment, Red Tiles devotes 4ft of chilled space to fresh produce and another 4ft of ambient space; this will soon increase to 12ft and 6ft respectively. "The secret to selling fresh produce is to keep it chilled if it can be chilled. We can sell one box of grapes a week of an ambient shelf but if those grapes were chilled we could sell three or four a week."


Brand news

l Milkshake brand Yazoo belongs to an exclusive group of drinks that are allowed to be sold in schools as they meet government health guidelines. However, Yazoo is not just a hit with kids. Nielsen research reveals that more and more adults are drinking flavoured milk too. Indeed, the flavoured milk market is now worth £175m up 16% year-on-year. According to Nielsen, Yahoo is the clear market leader in the impulse sector, accounting for 57% of sales five times that of its nearest competitor.

l The Laughing Cow is being relaunched via a multi-platform marketing campaign. This includes a 'Pull the Udder One' digital campaign; a new 'High Farm' TV ad; point-of-sale material; and promotional activity.

l Ginsters' latest special-edition pasty is Cheddar & bacon, which replaces steak & ale. Recommended retail price is £1.99.

l The latest launch from the Flora brand is Cuisine, which is described as "perfect for frying, roasting and baking". It's a blend of sunflower, linseed and rapeseed oil and it's natural in Omega 3 and 6 plus it contains 45% less saturated fat that olive oil.

l Bio Green Dairy has launched the Good Heavens! range of premium adult drinking yogurts. The nine-strong range comprises five non-organic and four organic flavours including 'fine Sicilian lemon & poppy seed' and 'intense tiramisu'. Each contains over 25% of an adult's daily calcium RDA. Recommended retail prices start at £1.79 for a 250ml bottle.