Convenience stores have a massive opportunity to take advantage of declining volumes at the top four multiples as smaller basket sizes gain in popularity, according to market research giant Nielsen.
Head of retailer & business insight UK Mike Watkins said people were shopping more frequently and spending less on the back of low consumer confidence. He added that rising fuel prices were a top five concern for shoppers for the first time, with one in three households using the car less often to save on fuel. “This is one of the triggers for people using small stores,” he said.
Speaking at C-Store’s Convenience Performance Seminar, Watkins said baskets containing one to five items were growing at 16% in supermarkets, “which is indicative of the opportunity for c-stores”. More importantly, he added, more households were now shopping for six to 10 items. “People are coming back from an out-of-town shopping environment and saying ‘I need to spend less, I’ll do my £20 food shop this week at a local small store’,” he said.
He added that the tide was turning from multibuys to simpler price cuts, and that future opportunities lay in local produce, with research showing that 65% of shoppers want to support local farmers and businesses, while 49% want to eat products in season.
Also speaking at the seminar, HIM client director Tara Benjamin said demand for mission management was increasing and shoppers wanted to see commonly purchased products merchandised together.