Nisa is to trial a disciplined, franchise-style trading format by the end of the year.
The new “push” model will require retailers to comply with strict procedures and disciplines, including planograms, auto-replenishment of stock and defined operating practices. The organisation aims to have five stores in the trial by the end of 2014, under both Nisa and Loco fascias.
Nisa chief executive Neil Turton admitted that the trial was in direct response to the growth of the One Stop franchise programme. He told C-Store: “One Stop is a fantastically efficient model, where you give up independence in return for greater profit. It could decimate the traditional symbol industry, and it would be dangerous to ignore it because we could potentially lose members that way.
“Generally speaking, symbol groups are very light touch, but they will have to adapt and innovate to survive. In five years’ time all the best sites could be gone, and we could see more multiples moving into franchises, so if we believe that franchising is a game-changer then we need to turn our thoughts into action and build it into our strategy straight away.”
Turton explained that the trial would not affect the established Nisa culture, but will instead provide an additional option for members. The group is targeting an additional 3% profit for participating stores.
“It won’t be for everyone, but we want to see if ultra-discipline can work, because more tightly-run stores can be more profitable stores,” he said. “The things that will contribute to success in the future will not just be the cost of goods but will be linked more closely to efficiency through things such as the level of overall sales, the cost of sales and stockholding.
“We’ll be looking to create something that retains the best of Nisa’s culture without sacrificing execution,” he added. “We still need to work out how we adapt the model, how we invoice and so on, but it’s all about helping members become better retailers.”