Shailesh Parekh, Lifestyle Express and Nisa stations in Birmingham
Shailesh has made some big choices this year, switching one forecourt store from Lifestyle Express to Nisa
Alpesh Patel, Londis Crouch End, London
Alpesh has recently invested a significant amount on a store refit including new chillers, lighting and product categories
Craig Cunningham, Abbiecraig Services, Fife
Craig says this year he has learnt to be more confident when trialling new lines and now makes sure he stocks enough to make an impact
Paul Stone, four Spar stores, Manchester
Developing his fresh impulse offering has been a key focus for Paul of late, and it appears to be paying off as he reports that sales are growing
Has this year lived up to expectation from a business perspective?
Shailesh: Yes, I think it has. Last year was a difficult one and I had expected that this year would be tough with the increases in minimum wage, energy bills and banking charges.
Alpesh: Had we not refitted and invested in the store, then it would have been a difficult year. To meet your expectation, you need to have an understanding of what the business requires.
Craig: Yes, it has. We were hopeful that the business would do well and we’re making sure that we’re up every week compared with the previous year.
Paul: I feel it’s got better as the year has gone on. At the start of the year, just 1% growth was acceptable and we were pretty flat for the first six months. Then we had a good summer and by September we were running at 6% up.
What has been your business highlight of 2013?
Shailesh: Generally, sales are improving, which is something I hadn’t expected to happen. If you switch on the news then you’d be led to think everything is very dark, but it’s not all doom and gloom. If you rise to the challenge, then you can see results.
Alpesh: The highlight of 2013 has been to see a good increase in chilled beers and wines, and Fairtrade produce. We started to stock many different brands of bottled ciders and ales and there’s been a good sales uplift.
Craig: Seeing our alcohol sales grow by three-quarters. This is partly to do with CJ Lang taking over the local store and altering the offering, and partly to do with our promotions. We’ve been offering wine for under £5 as they do in Morrisons and it’s been one of our best sellers.
Paul: We did really well when Robbie Williams was performing at the Etihad Stadium for a few days. We also had really good sales during Freshers’ Week when the Manchester Metropolitan University and University of Manchester students started back. We actually broke our sales record for the first week of September.
Which area of the business has disappointed?
Shailesh: I haven’t really been disappointed. If you start with low expectations then it’s difficult to be disappointed. I have seen a dip in alcohol sales this year, though, and I’m not sure why. It may be because the supermarkets are doing fantastic deals.
Alpesh: We took the in-store bakery off the shop floor as it was too demanding in terms of having staff to run it and maintain it, as well as track standards. When it first started up, no one knew about freshly baked goods from their local store, but that was more than 10 years ago so it was time for a change.
Craig: Nothing has really disappointed. News and magazines isn’t growing, but it isn’t down either - that’s just the state of the current market, though.
Paul: News and magazines has disappointed. We’ve cut back space for it in all our outlets and moved it further back into the stores. I had a meeting with News International, looking at how impulsive sales of The Sun are, so we’re looking at getting some freestanding display units for it to maximise on impulse purchases. As the category declines, the city centre CTNs will close and then there will be a market for it.
What was the lowest point of the year and how did you get through it?
Shailesh: The lowest point of the year was at the beginning of January when it was cold and no one had any money and there were taxes to pay. But by February things had picked up.
Alpesh: Trying to get the shopfit finished and turn the perfect picture in my mind into reality by conveying it to other people.
Craig: There haven’t really been any low points as such - it’s been a good year. Christmas is always the biggest challenge for us. It’s extremely cold and it can be hard when the snow starts to fall.
Paul: My lowest point was when I had to sack a member of staff for stealing. He was only a young guy and he hadn’t been with us very long. He was a nice lad, so it was a shame.
What is the biggest change you’ve made to your business this year and what have been the results of this?
Shailesh: I moved one of my stores to a new symbol group at the beginning of the year. We needed more technological support and marketing material and, for all its best intentions, Lifestyle isn’t geared up for it. You can’t do functions such as link up coding to your till and back office. Lifestyle is really more of a cash and carry outlet and it doesn’t have a fresh offering, either. So we moved my Midlands Link forecourt to Nisa and by the end of next year we’ll move another store.
Alpesh: The whole shebang! We’ve spent a six-figure sum on a store refit, with new chillers and LED lighting.
Craig: We’ve invested in a couple of new impulse chillers for sandwiches and taken on a local sandwich supplier so that we can stock value and standard ranges, as well as those from Ginsters.
Paul: Introducing hot food prepared in store has been new for us. It was something we did in response to Tesco Express opening up nearby. We made a conscious decision to go into something that they didn’t do. When Tesco Express opened we were 5% down, whereas previously we were 10% up. Now we are 6-7% up.
Which retailers or industry figures have you been most inspired by and why?
Shailesh: Raj Krishan - I’ve known him for a long time and he is very supportive of Nisa’s technological direction.
Alpesh: When I went to Cork with the Association of Convenience Stores to see Centra and Supervalu I was very inspired, from the top to the bottom of the supply chain, from wholesaling to retailing. Also, the way that Waitrose has opened its convenience formats has impressed me. It has tailored its offer to people’s needs and made good use of space.
Craig: I always think Morrisons is good. I like how it separates the alcohol area from the rest of the store so that it feels like you’re in a different shop.
Paul: Paul Cheema of Malcolm’s Costcutter in Coventry. The work he does with suppliers and what he has done with his off-licence section is great. How they have built their business and their standing in the community is admirable, too. Also, M-Local continues to impress. I like the hot food and non-food elements of its offer. Tesco is still good, but its stores are very cookie- cutter, whereas an M-Local in a university area sells duvets and cutlery for new students.
What has been your biggest learning of 2013?
Shailesh: How to manage money. I haven’t been as pro-active as I should have been in terms of looking after my customer needs because I was holding back, but I’m not going to be as cautious over the coming year! I’m going to take more risks.
Alpesh: The change in convenience retailing overall - from a basic needs corner shop, to providing for the individual needs of every single household and ensuring very high standards. The customer of today wants to shop in a well-fitted store with good lighting.
Craig: If you want to trial new products you have to go big or go home. In the past, I’ve trialled new ales in-store - just four or five lines - but they didn’t take off. This year, we tried again with 15-20 lines and customers have really bought into it. It’s the same with fresh meat - you have to give customers a decent choice to capture their attention.
Paul: In our business, there are loads of little things that all add up to the big picture. I guess my learning would be to try everything. When you go to a Spar Guild meeting and buyers put something in front of you, you have to trust that what they’re coming up with makes sense. For example, when we heard their advice to stock large tubs of Celebrations in September, all the managers were complaining that it was too early, but our store in Piccadilly sold 50 tubs a week!
What have your customers been telling you over the past year about what they want from their local store?
Shailesh: A lot of customers are looking for deals and bargains. Pound lines are very important for promoting value. You have to forget about making a 40% margin on them, though, and lower your mark-up to come closer to supermarket value. With multipacks of crisps you might only make 14%, but the customer might also pick up a bottle of drink while they’re in the store, so it’s worth it. People aren’t buying a big trolley shop at the supermarket anymore, so lots of people are shopping little and often at convenience stores.
Alpesh: My customers wanted more choice and ethical options. They have been very pleased with the new range of organic and Fairtrade products - we now have different ranges of teas and quality fruit and veg.
Craig: They want cheaper deals and they want pricemarked goods. Deals such as ‘two for £2 on groceries’, and ‘two for £1 on dairy items’ seem to work well.
Paul: They’re still telling us that they love £1 deals and we can infer from that that they are still hard pressed. We hear lots of comments from customers complaining about their energy bills. They want to eat well, spend less, and win the lottery!
Which area of the business has proved to be the most successful for you over the past 12 months?
Shailesh: Oddly enough, the fuel side of the business has been good over the past year.
Alpesh: Chilled has been the most successful area for us. We already had a strong range, but we have improved it this year. We now have 45-50m of chillers, which is an increase of 10m on the previous year.
Craig: In addition to alcohol, tobacco is doing really well. Our sales are up £2,000 a week on last year, while fuel is up 7% on last year. I think this is down to us growing our customer base and keeping prices as low as possible.
Paul: We’re doing more freshly prepared food and have branched into items such as ham & egg salads and fruit salads as the confidence of the consumer grows and word spreads about what we stock. Carrot sticks and hummus for £1 is proving popular. We try to hit a £1 pricemark where possible. Historically, we’ve always had good alcohol, cigarette and confectionery sales. But we need to be good at selling fresh food and healthier items, too.