Nowhere has been subjected to Tesco’s retail ambitions more than Andover, but the town’s independent c-stores refuse to be squeezed out of the marketplace. Robin Mannering finds out how they hold their own
A shadow hangs over Andover’s independent retail environment, and it is being cast by Tesco. In an area of fewer than 40,000 people, the multiple has muscled in with a superstore, a Metro and three Express convenience stores.
This makes this otherwise unremarkable Hampshire town one of the most Tesco-dense in the country, based on population per store (second only to Bicester in Oxfordshire). In fact, Andover is the UK’s number one Tesco town in which independent c-stores still trade they no longer exist in Bicester. But what is concerning for independent retailers across the UK is that Andover’s statistics are becoming less remarkable by the day as Tesco leads the big four grocery expansion.
In addition to the Tesco superstore, the compact town centre is home to a swathe of supermarkets Sainsbury’s, Iceland and Asda while another Sainsbury’s, a Lidl and a Waitrose sit beyond. If the extraordinarily intense competition is not enough, the local independents are also operating against a backdrop of inflation and tightened consumer spending, with few signs of economic recovery. But despite all this, they refuse to roll over.
Mace retailer Vip Panchmatia took the initiative last summer when he spent £220,000 refurbishing his shop, Hexagon Stores, doubling its size from 650sq ft to 1,400sq ft and introducing bake-off and alcohol sections. He also created more space for chilled and grocery while upgrading the post office. The results speak for themselves. “Since the relaunch our footfall has increased from 800 to 1,100 customers per day,” Vip says, “and turnover has gone from between £16,000£17,000 to £25,000£26,000 per week.”
Hexagon Stores can now provide for customers wishing to do more than a top-up shop. “Many of our new customers are coming here for their weekly shop instead of going to the supermarkets,” he says. “People used to come in looking for things that we just didn’t have the space to stock. Without the refit we wouldn’t have been able to sustain ourselves against the competition, which offers a one-stop-shop service.” But he is also gaining the business of local residents who have been forced out of their cars by rising petrol prices. Fortunately for Vip none of the competition is within walking distance of his store. However, rumours abound that Tesco wants to open another Express store at a retail unit nearby on Salisbury Road, which would have a major impact on Vip’s business. “Residents are opposed to the idea and I think the council has now realised how important independent shops are for the community. But Tesco has the power to push forward anyway the people can demonstrate their opposition by not going there.” Tesco declined to comment on the rumours, while the council only confirmed it had received a planning application for a retail unit on Salisbury Road. “However, no retailers are mentioned,” a spokeswoman said.
It is the ‘community touch’ where Vip can compete. “The mults are always a threat we can’t compete with them on price. But we have the edge on a one-to-one level of customer service,” he says. In the wider community he gets involved by supporting the local football team, while the shop’s community notice board draws in locals.
Vip is wary of the impact of Tesco on the whole town. “The council allowed five Tescos to go through in the past I don’t think they would now. They probably realise what the effect is and they are listening to us now. The recession has spoken for itself it’s the small businesses which will build the economy while the multiples tend to worry about themselves.”
A combination of the downturn and a saturated grocery market has led to many small shop closures since the onset of the recession a few years ago, according to Punit Patel, who owns Weyhill Stores, a Nisa Local shop on a main road a couple of miles from Hexagon Stores. “I think Tesco is taking over the whole of Andover,” he says. “There used to be about two, now there are five. They want to control the convenience market and kill the small businessman.”
His immediate concern lies with a recently opened Tesco Express located 200 metres from his store, which sits on a main road lined with residential properties. He says he can compete with Tesco Express on a number of fronts: alcohol (he has increased his range accordingly); cleanliness; and customer service. More surprisingly, however, is that he can also compete on price, which he attributes to “fantastic offers” from Nisa. “If we were with another symbol group we wouldn’t survive,” he adds. “Also, Tesco doesn’t have PayPoint so we can beat them there as people can come here and pay the bills.”
But one area where Punit can’t keep up is on the National Lottery. He says Camelot rejected his application for a terminal because he is too close to the Co-op, which is about half a kilometre away. “Then the Tesco Express opened and they got it. Camelot claimed Tesco had more footfall, but we have 500600 customers a day.” He reckons the Lottery costs him 1015 lost customers a day, and up to 25 on Fridays. Indeed, while C-Store was visiting, two potential customers inquired about the Lottery, before promptly walking out disappointed. “If we can get the Lottery, I’m not scared of Tesco. You can fight, but you’ve got to go a different way because you will never win if you do the same as them.”
Punit gets involved in the community through Nisa’s Making a Difference Locally initiative, in which his store contributes money to the local school. “More people want to shop here when they hear you’re helping the local school. Our next target is to donate money to the local church,” he says. “Tesco doesn’t do anything like that.” Overall, he is holding his own and trade is level on last year. “If Tesco wasn’t so close we’d get more local customers as a result of rising petrol prices. It’s bringing some shoppers who are walking to us instead of driving to the supermarkets, but many are going to Tesco Express instead.” In short, Tesco is stifling his growth, but it is not killing him.
However, if the multiple opens another Express store on the aforementioned Salisbury Road site, he knows the game is up. “We’ll be gone if that happens as the site is on the other side of the existing Tesco Express, and we get a lot of business from that side.” He says the council should in theory reject planning permission because there would be road safety issues and not enough space for lorries to unload.
Mayur Patel, who owns the unaffiliated Saxon Fields Stores on the edge of a large housing estate in the north of town, agrees that a Salisbury Road store would “severely hamper” Weyhill Stores and Hexagon Stores. “I’ve heard Tesco is in possession of the property, or planning to open there.”
Mayur’s nearest competitor is another Tesco Express (Charlton Road) which has been open for about four years. But he has a clear strategy to differentiate himself, starting with sourcing. “We support local suppliers including the local bakery, a honey producer and nearby breweries,” Mayur says. He sells eggs from a local farm and products from a nearby Wiltshire-based firm called Tracklement, which makes organic chutney, mustards, ketchups and preserves. “The mults all sell the same ketchups, there’s no choice. But here people can get a choice of local, the major brands or a budget option.” It is a strategy he adopts across all categories, and one that has paid off. “Increasing the variety has boosted footfall,” he says. His decision to remain unaffiliated offers flexibility with sourcing, so in addition to local suppliers he buys from P&H and Booker, whose value Euroshopper brand he sells alongside bigger brands and local produce.
His store is listed on Tracklement’s website, which helps to raise its profile. “Support the local guys and they support you,” he says. Like Punit, he also focuses on his alcohol range, offering multi-buy wine deals and beer in pint size formats to cater for the rise in stay-at-home drinkers.
He has also sought to soak up the trade left by the closure of town centre shops. “I found out what was disappearing and introduced their products in my shop. For example, some party shops have closed so we’ve introduced helium balloons.”
Emphasis on personal service is as crucial to Mayur as his local counterparts. “We support older people and will deliver to them if they can’t make it out. You look after them and they’ll put the word around,” he says. “We also support the church and provide them with squash for their meetings.” Mayur sums up his philosophy as: “If the community is your top priority, money will follow, but if money is your top priority, the community won’t.” One of his regular customers tells C-Store that his customer service is second to none. “Anything we’d like, he gets. I wanted a lobster once, and he got it in from London. I had a New Year’s Eve party, and he supplied all the food I needed without much notice,” she says. “We also go to the supermarket but we buy a lot of things here, including fruit and veg which is always fresh. Nothing is tired here - and they don’t stop smiling.”
Mayur’s secret weapon, he says, is his teenage son who, along with the rest of his family, puts in hours at the shop. “He upsells everything and anything, and always points out the offers available. Also, he knows all the kids on the estate so they all come here too.”
High street concerns
Mayur warns that town centres are dying, blaming rising rent which is forcing migration to shopping malls. But he believes independent retailers have the support of the community. “The word on the street at the moment is ‘I hate Tesco’,” he says. Like Punit, he loses customers because Camelot won’t give him a Lottery terminal, whereas the local Tesco Express does have it. “Camelot’s area manager said it was nothing to do with him and refuses to visit us,” Mayur adds.
Vip, meanwhile, shares Mayur’s fears over high streets, and welcomes Mary Portas’ investigation. “She is very good at what she does. I think using a celebrity is a good thing as it makes people more aware of what is happening on the high street,” he says. “I invited her to my store and she says she will come.”
Mayur doesn’t blame the local district council, Test Valley, for the state of Andover’s retail environment. “The council is good, it always gives advice when I ask for it and immediately puts me on to the right people.” Vip welcomes the council’s support in providing small business rate relief. “But this shop is in their interest as they own the building.”
Punit is more dismissive about the council’s support. “When my local Tesco Express opened there was a lot of opposition to it, but the council didn’t do anything,” he says.
For the council’s part, it says it has just launched the Andover Skills Training Fund which will provide grants for small businesses employing up to 50 people, including retailers. It also offers a £500 Business Incentive Grant to new businesses, and is ‘proactive’ in encouraging smaller businesses to apply for small business rate relief.
Mayur plans to contact Hampshire County Council, which is responsible for the highway network, to ask them to erect road signs directing people to small stores like his. After all, there are already such signs for supermarkets. Vip has built relationships with councillors and local MP Sir George Young to garner their support, while Punit and Mayur say they will also contact Sir George if Tesco continues its local expansion.
Reaching out to the community appears to have paid off for the three retailers. But communicating with each other has also proven effective in the past.
Vip says: “We get together regularly with other independents to chat things over. When newspaper distribution changed, for example, we had some success in our campaign to stop publishers bringing margins down.”
With the same collaborative approach, Andover’s independents can take the fight to Tesco and carry on serving their customers with passion and initiative. After all, it is they, and not Tesco, who are the lifeblood of the community.