“When William Reed Publishing launched Convenience Store in February 1985 it was arguably 10 years ahead of its time. Independent retailers thought they were still grocers (and most of them were); the multiples didn’t open on Sundays; and there were fewer than 400 superstores.
“US c-store companies believed the UK market was ripe for convenience. Circle K and 7-Eleven made inroads into Britain and although they didn’t disappear with indecent haste, where are they today? A conglomeration of smaller American operators such as Mad-Max opened here, but soon realised it wouldn’t be the comfortable ride they had originally expected.
“It was a bold move by trade entrepreneurs such as Bob Sperring, Mike Weston and legendary Spar boss John Irish to stick their neck out and say that convenience trading was the only way forward. Symbol group heads and trade organisations revelled in taking their members to the US to see how c-store trading worked. Alas, many of them let the gin and tonics cloud their judgment. Attempts to make hot food to go an integral part of a c-store’s inventory and moves to bring in other Americanisms were largely short lived - although these tactics did gain credence in many forecourt shops.
“However, delegates to the US were left in no doubt that an off licence, chilled foods and fresh produce were big earners and these categories - plus cold takeaway food such as sandwiches - soon became essential this side of the Atlantic.
“Research figures indicate that a symbol retailer is likely to be doing better than his unaffiliated counterpart and there are few who would deny that Spar has stood the test of time better than any other group. Today it remains head and shoulders above the rest. Chains such as One-Stop, Bells, M&W, Alldays, Morning Noon & Night and so on made a significant impact, so much so that many of their ilk became prey for the major multiples.
“What is reassuring is that the total demise of the unaffiliated independent that was said to be inevitable by many trade pundits, simply hasn’t happened. Store numbers have plummeted, but there are still thousands of well-run and successful family businesses. Much of the credit for the unaffiliated guy’s resilience must go to the cash and carry wholesalers, who were once branded by the then boss of Spar as being like kamikaze pilots, hell bent on self-destruction.
“The sector has come a long way from the days when C&Cs nailed appalling fascias (did I mention Happy Shopper?) above independent stores’ doors, and thought that alone would keep retailers in business. C&Cs have always had their backs to the wall in their fight to get equitable terms in line with the superstores, but they have moved on from the old health-risk warehouses that offered packaged groceries, competitive prices and little else.
“Today quality operators such as Parfetts and other Landmark Wholesale members, Bestway and Booker offer the independent a comfortable shopping environment, decent prices, a wide product portfolio and widespread assistance if required.
“There have always been retailers who prefer the symbol group route and others who want total independence. The symbol groups are now more insistent on having high-quality stores trading under their fascias than was the case 21 years ago.
Likewise, the C&C operators have nurtured those independents whom they believe they can work with on a ‘partnership’ basis and that is good news for both wholesaler and retailer.
“Things have never been quite the same since those fateful Sundays in December 1991 when the multiples began trading on the Sabbath. It was believed at the time that this would be a short-term move in the run-up to Christmas. It is history now that those bully-boy tactics became permanent and changed the face of UK retailing.
“Looking back, the arguments that prevailed in 1985 were much the same as those in evidence today - discriminatory discounts, wage rates, red tape and even Sunday trading.
“But although convenience store numbers have dipped appreciably over the past 21 years, independents have still got a lot going for them. Many are entrepreneurs in their own right, more than capable of making their own decisions.
“Those who need outside assistance can look to symbol groups and wholesalers headed by key trade figures such as Jerry Marwood, Colin Graves, Steve Parfett, Sir Anwar Pervez and a few others, who have in their ranks trained operators with the know-how and experience to improve retail businesses.
“Here’s to the next 21 years.”
Morton Middleditch, Former managing director of Spar UK
“Spar’s Eight Till Late fascia was launched in 1981, and by 1985 we had 500 Eight Till Late stores. It was that growth of Spar in the convenience sector that gave others the encouragement to join in, although they didn’t join in straightaway.
“When John Irish started Eight Till Late what he did was give everybody the opportunity to get in on the ground floor of convenience retailing before it became fashionable. Those who joined had a 20-year start on the major multiples, and that led to those businesses being better placed to be more resilient now the competition has come along.
“The past 21 years have seen a move by independents to rely much more on delivered wholesalers, and their dependence on cash and carry has diminished. The improvement in wholesale service has encompassed a lot of things - you don’t actually have to go anywhere else if you’re an independent retailer.
“Retailers’ attitudes towards symbol groups have definitely changed. There’s a greater trust and a sense that we are in this together. We can’t live without our retailers, and we’d like to think that our retailers couldn’t live without us as well.
“But the biggest improvement in symbol retailing is the quality of retailers in groups now. They are much better businessmen, more dedicated to running a successful convenience store than had been the case. They’re better trained and more entrepreneurial. They recognise the role of being part of the community in their area, and store standards have improved hugely.
“The symbols are also providing retailers with better equipment, more refrigeration, and we’re putting air conditioning into stores, which is what the multiples do.
“Scanning was another big change. This allowed retailers to run their business on a better financial model because they actually know what they’re selling and making money on.
“There’s been a shift from the older symbol groups to the newer groups, with the exception of Spar being constant throughout. Mace is a much smaller business than it was in 1985, but Spar has grown, as has Londis and Costcutter.
“The decline of VG was political in that some wholesalers in VG went off and did other things and didn’t concentrate on convenience. In Spar, we had wholesalers virtually dedicated to developing Spar, and that’s why we prospered and VG didn’t. Those symbol groups that decided to concentrate on delivered retailing, delivering to symbol retailers, are the ones that have prospered.
“The National Lottery did an awful lot for the independent retailer and the convenience sector as a whole. One of the major shareholders in the original lottery campaign was Cadbury Schweppes and it made available to Camelot its records of all the stores its products were sold through. The independent sector got a good proportion of the lottery outlets so a lot more consumers had to go to an independent store to get their lottery tickets and I think that helped sales of other products.
“Another development was the growth of mobile phone top-up cards - that had a tremendous impact on the footfall of convenience stores.
“The major change for us in those 21 years has been the legalising of longer opening hours. Everyone had been open longer hours in 1985 illegally, but changing the Sunday Trading law was a great benefit to the independent sector.”
Trevor Dixon, Former chief executive of the Association of Convenience Stores
“When we created the Association of Convenience Stores in 1995, many independents were furious with the supermarkets because so many had been forced to sell their family business. So when an open association presented itself, they were keen to join.
“I became involved when the British Independent Grocers Association’s national secretary left in November 1994. BIGA wasn’t going anywhere and found it difficult to recruit retail members. It didn’t have wholesale members - they were ambivalent towards it.
“Early on I said that the way forward was convenience stores and unless we radically restructured the organisation, it would continue to struggle. I insisted it should be an inclusive organisation with independents, wholesalers - particularly those running affinity groups like Spar and Londis - and wholly owned multiple c-store groups in membership. So in February 1995 we changed the name of the organisation from BIGA to the ACS, and in May 1995 we held our first AGM.
“The American organisation NACS was a huge influence on me - I modelled the ACS on it - so Lyndsey Hutter from NACS came over for the first AGM because we wanted to illustrate that everyone within the UK needed external input. Each annual conference thereafter we had an overseas visitor, usually from the US. They had a lot of experiences to share and were prepared to share them.
“BIGA was really limited by a lack of funds. I think it was full of good intent but rather slow to look at what it could do to answer the problem of multiples gaining market share. I tried to say that the supermarkets weren’t going to go away so we should offer a complementary service, which was top-up and distress shopping. Independents deserved an association that would really promote that message for them.
“One of the biggest changes was the start of government lobbying. To show the bravery of the association we appointed Quentin Browell as consultant political adviser. He knew how to open doors to the Ministers. Retailers had always been represented by the British Retail Consortium, but all of a sudden, people in government were saying: ‘AC who?’. That’s when we really made a name for ourselves.
“I was keen not to just lobby government, but to suggest solutions to the sector’s problems as well. For example, it was pointless lobbying to get rid of the national minimum wage but we could lobby its level. But just as we were beginning to understand lobbying, we had a change of government in 1996.
“However, retailers were terribly supportive of the new association. The affinity groups brought their members into nominal membership, and by Spar signing up it allowed us to use their membership of 2,200 retailers in our claim that we represented this many retailers. To government, that was a very credible number.
“We worked hard to recruit the multiples and the first to sign up was Alldays under David Saunders, and others came onboard very quickly after that. We made huge strides forward with affinity groups and multiples. Retailers suddenly felt there was a power going with them.”
“Wholesalers had a ‘stack-it-high, sell-it-cheap’ view of the business 21 years ago, but this no longer applies. The greatest change has been the use of technology, which has had a dramatic effect. Its introduction has provided in-depth epos data for the retailer and faster checkouts for the wholesaler.
“Improved stock control now means that there are fewer losses through theft, for instance, and these savings can be passed on to the retailer. More specifically, the increased sophistication of technology for delivered wholesalers allows them to send and receive orders online, control customer price lists and promotions and even monitor the store’s profitability.
“Technology has improved access to information that can help wholesalers engender retailer loyalty and provide customer advice. These developments have provided a degree of professionalism to the sector which could only have been dreamed of 21 years ago.
“Wholesalers have improved the shopping experience for the retailer through a more efficient store layout with the help of sophisticated planograms and better lighting.
“The relationship between wholesaler and c-store has become much closer. The development of symbol groups and retail clubs has been extremely influential in this, assisting retailers with promotional programmes and leaflets, supported by pos material.
“Like all businesses, wholesalers have had to adapt over the past 21 years to survive. The key milestones include: consolidation - many large wholesalers have merged and the emerging problems create opportunities for independent wholesalers; private label - which has helped the wholesaler retain its relationship with the retailer and in turn assist the retailer in securing repeat custom; smaller pack sizes, emerging from the wholesalers’ strong relationships with suppliers and assisting retailers’ cash flow; and pricemarked packs, which give consumers confidence and drive promotional activity.
“The improvement in stock availability due to new technology also helps with ranging, pricing and forecasting. In addition, wholesalers can provide a much greater range of services to the c-store such as store refits, merchandising, and store planning. However, one of the greatest single factors in improving wholesaling is consumer leafleting and professional in-store pos.
“Most changes that have taken place in the wholesale sector over the past 21 years have been for the better. If they had not changed, the prediction that there would be no wholesalers left 25 years ago would have come true.
“The biggest negative on the sector is the huge reduction in the number of sales personnel, both at wholesaler and retailer level. This has had some positive effect in that cost prices have reduced, but execution - particularly of new products - is probably not as good as it used to be. Technology too - though a major benefit - has a downside in that the administration associated with it sometimes nullifies the natural flair for ‘selling the deal’ that the wholesale sector used to be renowned for.”
Trevor West, Trading director, Convenience Petcare & Food, Masterfoods
“In 1985 suppliers were just bringing in bar coding on products, but it was very much in its infancy. It wasn’t until the 1990s that epos was properly widespread, but that gave supermarkets a greater awareness of what was going on in their business and more flexibility on promotions. That moved them way ahead of independents who were still using price guns.
“When epos arrived with it came supermarket central distribution, so they didn’t want sales guys calling anymore. In the 1980s we delivered direct to everybody so we would call on Tesco, Asda, independents, farmers merchants, everyone. We had regular contact and would go in and merchandise, take orders, do the whole thing for them. But when the multiples became more powerful and said they didn’t need sales teams calling, big suppliers reduced numbers in their sales forces dramatically. Independents wanted the face-to-face calls but the suppliers didn’t have the staff available.
“Clever suppliers recognised that they had to find other ways to give independents support. They started to work with cash and carries and wholesalers, trade press and symbol groups to ensure stores stock the right range. Suppliers now use their resources in a different way.
“For a time there was a view that most suppliers had moved away from the independent sector to court the multiples. But I think that view has changed now. There’s probably been a lack of trust because a lot of suppliers recommended biased ranges, but in the past five years major suppliers have talked about the best range for the category. We wouldn’t have done that 21 years ago. Now we’re convincing retailers that we are serious about it and that a responsible and unbiased message comes across.
“Manufacturers such as Cadbury and Walkers still have a sales force because convenience is a massive slug of their business, but most of the grocery suppliers don’t have the staff to do it. The contact is more remote now, but what’s actually offered is more relevant and sophisticated category management information.
“When the supermarkets got national coverage and TV advertising, own label started to take off as well. That didn’t have a lot of impact on suppliers at first because own-label products tended to be the lower price end, but as time went on you got different price points. All this has driven share for the supermarkets, and reduced the importance of branded suppliers in those stores. So for c-stores, big brands became even more important. I’m sure the likes of Spar and Nisa might disagree, but even now there’s not a credible own label in convenience - consumers still look to big brands for reassurance. As a result independents became more important to branded suppliers.
“Over more recent years, suppliers realised the need to look at special packs for the convenience sector. Smaller case sizes and pricemarked packs such as ‘two for £1’ offers all help convenience stores to compete to some extent with the multiples. ‘Two for’ price offers appeal to consumers who are used to seeing those offers in supermarkets.
“Suppliers have also tried to increase the sizes of primary packs in independents. It used to be the case that retailers and suppliers thought convenience stores should sell smaller pack sizes because people didn’t want to spend as much money, but we’re now moving towards providing independents with packs that shoppers are used to buying in the multiples.”