Ajay Parehk has £300-£400-worth of stock that he can’t shift. And he has already lost another £100 or so of fresh stock. He runs a Londis in Nottingham and has been pointing a finger at Booker’s allocation scheme for promotions.
“Now that Booker has taken over I have to take part in their allocation scheme. I was on the large selection, getting 58 items on promotion every four weeks. Now I’m on the smaller, getting 38 items.”
He says the scheme, which is national, has no flexibility. And he gives me a potent example. Part of the allocation recently was a case of Taylor’s bacon. It’s £22 a case and he sells it (or can’t sell it) at £3.50 on a buy one, get one free deal; the Euroshopper brand is sold at £1 pricemarked. “This is the only one I can sell. I haven’t sold a single pack of Taylor’s in two weeks.” (It’s a bit of a hard-up neighbourhood.)
When ordering from Londis-Musgrave he had the choice to opt out via email tick box.
He showed the unsold stock to the rep who didn’t know what to say to him. “I said to him, someone can come in here and stick a gun in my head but you guys are just taking my money directly out of my bank account. Where does it stop?”
Ajay has other problems, in the form of discounters trading directly opposite him, including B&M, notorious for their cheap as chips prices. He gave me a couple of examples of those as well. “Booker has wine on promotion at £5. Over the road it is £3.99. Heinz ketchup is £1.50 for 500ml through Londis. At B&M it’s £1.99 for 900ml. They are not short-dated either, he adds.
He says that B&M has hit every trader in the district. “They overlap on everything.”
I know the Londis team is now working hard with Ajay to find a solution; meanwhile here is Booker’s official response: “Londis has recruited more than 500 new independent convenience stores in the past six months with its new, lower cost and simpler-to-do-business-with retailer offer. The proposition includes free membership, free consumer leaflets, free epos and Spend & Save discount scheme giving retailers up to 4% rebate. The new scheme gives retailers a significant increase in choice, particularly in value own-brand and fresh. Together with a substantial price investment to deliver competitive wholesale pricing, the Londis proposition has driven record levels of new retailers joining.
“Retail promotions are an integral part of the new Londis symbol offer, and the common element that Londis asks all of its disciplined retailers to engage with. Today’s shoppers expect convenience stores to offer regular promotions with great deals on branded products. To help retailers deliver strong promotional activity, Londis allocates free personalised leaflets, free POS and a small number of product cases, all helping retailers to deliver high-impact promotions with full availability of market leading deals.
“Londis has had great support from suppliers who have helped its retailers make more profit from promotions - in return for this Londis makes a small allocation to ensure the goods are on offer for the consumer, like all other symbol groups.”
Londis brand director John Pattison says: “Londis’ focus on increased choice, lower prices and better service supports retailers to make more and save more - a typical Londis customer has seen more than £20,000 per year increase in their profitability.”
Ajay realises that his situation isn’t typical and is pleased to be discussing various options, from signage to remerchandising to the forecourt (smaller) package. “I’m not totally happy, but I’m happy to work with them,” he says.