Coffee, food to go and quality over quantity were some of the opportunities highlighted by leading retailers and analysts at the ACS Summit this week.
Kris Engskov (pictured), president of Starbucks Europe, Middle East and Africa, underlined the increasing importance of coffee and the opportunity for UK c-store retailers to franchise the Starbucks brand for the first time.
Speaking at the event in Birmingham NEC on Tuesday (21 April), he said: “We can’t keep up with the rate at which people want to learn about coffee. It has never been more important in people’s lives.”
He added that the key component to selecting franchisees was “the right partner with the right values. With franchising, you’re getting married!”.
Nick Lloyd, managing director of Budgens Symonds, which owns a number of forecourt stores in the South West, said growth in the group’s Costa-branded coffee units had exceeded expectations. Sales were up 20-30%, and in one store they had to add an extra unit to meet demand, with sales up a further 30%.
He added that retailers looking for larger units were missing a trick: “Everyone is looking for 3,000sq ft forecourt sites. But do you need 3,000sq ft? The top selling c-store are 1,000sq ft. Size doesn’t matter. For me smaller is more efficient and more profitable. We need to focus with suppliers on the best lines rather than always introducing new ones.”
He said smaller stores were ideal for self-service tills, which were “a revolution waiting to happen”. “It’s an opportunity for staff to interact with customers, to pack for them and make them feel special. Retailers have been introducing the technology for the wrong reasons,” he added.
Steve Murrells, chief executive of retail at The Co-operative Group, agreed that convenience “isn’t based on size, it’s based on missions”.
“We’re no longer a nation of shopkeepers, we’re a nation of grazers. The challenge is to be ready for the different missions,” he added.
Mike Watkins, head of retailer insight at Nielsen, said the three winning opportunities for retailers were: frequent visits, little & often; food for the next three days, baskets up to 10 items; and food to go.
Echoing the theme, Jill Livesey, of HIM Research and Consulting, said food to go footfall grew by 5% last year, while 85% of shoppers now top up every week - a 5% uplift on last year.