The latest convenience store industry figures show that while the industry continues to grow its sales strongly, the decline in the numbers of independent retailers is accelerating.
Figures from the IGD’s latest report Convenience Retailing 2005 show sales in the sector grew 4.9% to a value of £23.9bn in 2004, despite a drop of 2.9% in the total number of convenience stores. The main reason for the decline is a 7.4% slump in the number of unaffiliated independent retailers, a rate of decline that, if it continues, will see independents making up less than half the c-store industry for the first time next year.
While a large number of unaffiliated retailers sold up or joined symbol or fascia groups during 2004 - symbol numbers were up 3.6% - they have not been replaced by new entrants to the sector.
The flow of CTNs and off licences converting to fully-fledged c-stores has slowed down, and rising store standards in the multiple estate has undoubtedly increased the investment levels required to remain competitive in convenience retailing.
Sales through convenience multiples grew 17.8% during the year, with the average annual sales per store up 9.6% to £1.12m. Fresh and chilled food is becoming more much more significant, and the report states that chilled now accounts for 11.6% of sales in convenience multiples. While not directly spelled out in the publication, this is surely a reflection of One Stop stores being converted into Tesco Express outlets, and increased investment by other multiple retailers to keep pace.
The value of sales through symbol stores increased 8.9% and now stands neck and neck with unaffiliated independents at around £7.5bn per year. In the forecourt sector, the contraction in sites has continued, but 90% of the forecourts that have survived now trade with a c-store offer. The sector overall made sales gains of 5% through the improved performance of these stores.
IGD predicts the convenience sector will continue to grow strongly and could be worth as much as £32bn by 2010. Report co-author David Gordon said: “There is rising demand for convenience, rising affluence, and an increased capability for retailers to meet the demand to deliver these needs. The idea of convenience as a product and service offer is holding firm, so there are good conditions for growth in place.”
Figures from the IGD’s latest report Convenience Retailing 2005 show sales in the sector grew 4.9% to a value of £23.9bn in 2004, despite a drop of 2.9% in the total number of convenience stores. The main reason for the decline is a 7.4% slump in the number of unaffiliated independent retailers, a rate of decline that, if it continues, will see independents making up less than half the c-store industry for the first time next year.
While a large number of unaffiliated retailers sold up or joined symbol or fascia groups during 2004 - symbol numbers were up 3.6% - they have not been replaced by new entrants to the sector.
The flow of CTNs and off licences converting to fully-fledged c-stores has slowed down, and rising store standards in the multiple estate has undoubtedly increased the investment levels required to remain competitive in convenience retailing.
Sales through convenience multiples grew 17.8% during the year, with the average annual sales per store up 9.6% to £1.12m. Fresh and chilled food is becoming more much more significant, and the report states that chilled now accounts for 11.6% of sales in convenience multiples. While not directly spelled out in the publication, this is surely a reflection of One Stop stores being converted into Tesco Express outlets, and increased investment by other multiple retailers to keep pace.
The value of sales through symbol stores increased 8.9% and now stands neck and neck with unaffiliated independents at around £7.5bn per year. In the forecourt sector, the contraction in sites has continued, but 90% of the forecourts that have survived now trade with a c-store offer. The sector overall made sales gains of 5% through the improved performance of these stores.
IGD predicts the convenience sector will continue to grow strongly and could be worth as much as £32bn by 2010. Report co-author David Gordon said: “There is rising demand for convenience, rising affluence, and an increased capability for retailers to meet the demand to deliver these needs. The idea of convenience as a product and service offer is holding firm, so there are good conditions for growth in place.”
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