Andrew and Rosslyn Hadley of Corner House Stores at Minehead, Somerset are the winners of C-Store’s ‘Get Your Business in Mint Condition’ competition, sponsored by The Wrigley Company.

The prize included a half-day consultation with successful entrepreneur Duncan Bannatyne.

Andrew and Rosslyn Hadley are trapped in a time warp. They’ve run Corner House Stores since December 2003 but have done little to bring the operation up to modern standards - there hasn’t really been any need. Winning the competition has, however, given them the opportunity to tap into Duncan Bannatyne’s expertise and encourage them to get their expansion plans off the drawing board. The Hadleys have very clear ideas about the direction they want their business to take. “Ultimately we want to increase profits,” says Andrew. “We think that having a lottery terminal would help to significantly increase trade, however in order to qualify for a terminal the store has to be at least 750sq ft and at the moment it’s only 475sq ft. Expansion is therefore integral to our growth plans. In the longer term we hope to increase business enough to justify a lifestyle change, taking more time out to spend together.”

Duncan advised Andrew and Rosslyn to consider several issues before making a decision:

are they being realistic about the level of increased sales the store expansion would generate?

how sure are they that customers will spend more money as a result?

how they could make better use of the existing store space?

installing an epos system to give them a more accurate picture on sales figures. Even so, based on the information supplied by Andrew, Duncan was implicit that, considering their circumstances, store expansion would be preferable to purchasing another site - which was another option discussed.

He advised: “If you buy another store in Minehead it may well cannibalise customers. However you should find out for sure the exact store size and the conditions stipulated by Camelot in order to qualify for a lottery machine. They may make provisions for smaller stores and an extension may not be necessary.

“As far as the expansion is concerned you should consider getting a quote for a single and double storey extension - the latter may not cost much more and you get most of the extra cost back in VAT. You need to get an architect in to do the drawings so that you’ll know for sure whether the extension would bring the store area up to the 750sq ft that you need for lottery, because I’m not sure it will. You need to get planning permission for the extension - this will be an asset even if you decide not to go ahead.”

Duncan’s comments raised some doubts in Andrew’s mind concerning the degree of extra sales the expansion could generate. “I have to admit that there’s not much chance of attracting new customers because we have very little passing trade,” Andrew said. “There is a builder’s yard nearby and so the bake-off may suit them, but the ageing population in Minehead is unlikely to use this. They just want the everyday items that we already stock, so it is a subject I need to look into.”

Duncan pointed out that making better use of the existing space might benefit the store’s bottom line as much as the expansion. “One example of this would be to reduce the number of toilet paper skus and make kids’ party accessories and stationery more visible.”

Referring to a couple of empty top shelves, where chocolate was normally merchandised but had been removed because it had melted, Duncan suggested reshuffling categories to ensure all shelf space is used. Duncan also recommended offering more local services, like dry cleaning, which Andrew was receptive to. The store does run a successful home delivery service to 35 customers. Andrew explains: “There is a minimum £6 spend and delivery is free. We actually make more money on the goods we deliver to customers’ homes than on what we sell in-store. We deliver most days although we’re usually fairly quiet on a Monday.”

Duncan advised keeping deliveries down to two days a week rather than whenever customers demanded it. “You must not let customers dictate too much,” he said.
The Hadleys have their own branded delivery van which Duncan commended as “a great advert for the store”, and they advertise on the local radio station. At the moment Corner House Stores sells groceries, newspapers, fresh and chilled, alcohol, tobacco, over the counter medicines, confectionery, utility payments with Paypoint and non food products. A larger store would enable them to add bake-off, expand chilled and beers, wines and spirits, improve the stockroom layout, and make the store more self-contained.

However, at the end of the day, the future of the expansion rests on the architect’s prognosis and the bank’s go-ahead. There is a lot for Andrew and Rosslyn to digest and in six months, Convenience Store will revisit the store to see just what changes have been made.

You need to consider:

how realistic it is to assume that expansion will increase footfall, and that customers would actually spend more money;

how you could make better use of the existing space in-store;

doing nothing for a while until you’ve installed epos and have a better idea about sales, footfall and basket spend;

getting rid of non sellers that you’ve specified, like magazines. 

Making small changes often have Big results. Duncan had a few ‘nuggets’ for Andrew and Rosslyn: a special offer A-board outside the front of the store. You need to decide what you want to get out of cash and carry offers and consider promoting them more;

take the card adverts away from the front window, update them, and put them on to a board in-store - appearance is everything - and charge customers for them;

move products directed at children to lower shelves so that they can see them;

negotiate a better deal on credit/debit card and cheque transactions with your bank.

Andrew and Rosslyn’s goals

Be eligible for a National Lottery terminal

Spend more time away from the business

Install a bake-off unit

Have a better stock room

Make cigarette merchandising more secure

Extend the range of beers, wines and spirits

Make the store more self-contained with a view to leasing it in the future

Increase the future saleability of the business.