America. Land of the free, home of the brave – and now 
generator of sales for UK retailers. Yes, store owners here have been looking across the pond for products that set them apart. To celebrate Independence Day we take a look at what’s been making the transatlantic crossing.

Great Britain has given the US many things over the years. The Beatles and David Beckham and, more recently, Susan Boyle and Piers Morgan. Well, maybe forget those last ones. Some disappointments aside, it’s probably time that it started giving back. And what better way to cash in on American popularity than to stock produce direct from the good ol’ US of A?

Londis retailer Steve Bassett has been stocking US products in his Dorset stores for a year and has seen huge success. He says he started with just one or two lines and worked from there. “I saw one product and gave it a whirl and when that did well I expanded upon it,” says Steve. “Products such as Pop Tarts do very well, and anything with peanut butter in it always sells as there aren’t as many UK products with it.”

State of the nation

Forecourt stores fuel growth in US convenience

Candy and grocery lines may have hit our shores, but what’s the next big American import likely to be? And is the US convenience market faring as well as it is here?

According to the National Association of Convenience Stores (NACS), sales in US convenience stores are increasing. US in-store sales grew 2.4% to $204bn ($695.5bn including fuel sales) in 2013, while store numbers increased by 1.4%.

The industry has been gravitating towards food service, where sales grew 2.4% last year. Food service, which includes prepared and commissary foods, and hot and cold dispensed beverages, now accounts for 18% of in-store sales and is the second-highest category after tobacco (37%).

Fuel and convenience in the US also continue to grow hand in hand, with 83.7% of stores now selling fuel, an increase of 2.7% on the previous year. Although fuel is responsible for a high proportion of overall sales, NACS reports that it accounted for a little over a third (35.6%) in profits, with in-store purchases driving profits.

He believes that their popularity lies in their difference. “They’re a novelty and something that other stores don’t necessarily have,” says Steve. “People want to try new things and have probably seen these products in films and TV shows. It was amazing how many Twinkies we sold after the film Zombieland was shown on TV, because they’re featured in it several times.”

Damien Curzon-Price of Americatessen importers and distributors says the products will probably stay niche for the foreseeable future and are unlikely to be sold by the multiples. “The multiples would want to sell huge volumes of US produce if they stocked them, so it’s better placed in the independents,” he says.

Having imported American products since 1993, he has seen demand increase of late and believes there are several reasons for that. “The growth of the internet has clued people into what else is out there, and the demise of Woolworths opened up a gap in the confectionery market,” he says. “People travelling more has also opened up consumers’ eyes to the different products out there.”

He currently stocks 500 lines, half of which are confectionery. Curzon-Price says it’s better to stock a solid range of lines with strong availability rather than promising thousands of lines and underdelivering.

Steve agrees and suggests combining core lines along with some variation. “The whole point of US products is that they’re different so it’s important to mix it up whenever possible,” he says. “Some customers will come to us just to see what’s new.”

With most of his US lines being confectionery, Steve is careful about pricing and tries to keep prices affordable. “They have quite a high price point so you don’t want to put people off,” he says. “I’ve been in some stores that sell US stock and they go completely overboard on pricing. I’m happy to charge a reasonable price for them when the margin is better than that of the regular confectionery I sell.”

Another recent convert to US products is Surjeet Singh Notay of Nisa Heckmondwick in Leeds. He decided to start stocking American confectionery and soft drinks in his store to create a point of difference from other stores in the area.

Surjeet says that as well as providing strong margins of more than 30%, the fixture also attracts young adults to the store. “I went into the specialist candy shops and priced the stock similar to them,” he says. “The products are probably a bit too expensive for children, but young adults in their early twenties love them. A lot of it is nostalgia, or if they’ve been to America on holiday and enjoyed some of the products there.”

To help promote the American produce, Surjeet uses social media to get people interested. “When we first got Pepsi Throwback in the store, I put a notice on the store’s Facebook page. As a result we were then selling a case of it a week,” he says. “People shared the post with their friends as it was something different, which generated a lot of interest.”

Store layout

US design ideas catch on here

As well as products, the US can also provide store layout ideas. Hot beverage machines may be a staple of UK convenience stores now, but they’ve been in US c-stores for more than 20 years, and while a beer cave may seem like a fantasy of most men, if you have the space it can be a lucrative sales driver.

John Carty created a beer cave - a cold, walk-in room for the chilled alcohol range - at his Spar store in Camberley in Surrey.

“We saw something similar in a couple of Spar stores in Wales and thought it looked good,” he says. “We were due a refit so we decided to go for it. Alcohol makes up a huge part of our sales so we wanted to do it right. It’s not that much more expensive than a chiller as it doesn’t have to be kept at as low a temperature, but then you are chilling an entire 3m x 4m room so it probably evens out.”

He says the beer cave is a talking point among customers. “Everyone loves it, and the fact that they can pick up chilled stacks of beer is a real plus,” says John. “It’s quite impactful and helps us stand out from the competition.”

Steve says that with the right promotion US products can help bring in new customers. “If you mix up your range and promote it properly, you can get a reputation for having something different and you become a destination store for those outside your catchment area,” he says.

However, Surjeet warns that it’s important to get the right supplier for these products. “The wholesaler I was working with started letting me down and availability wasn’t great,” he says. “This caused me to doubt them, plus it was resulting in my customers being let down. They just weren’t reliable and now I’m looking elsewhere for a supplier.”

Curzon-Price agrees that retailers should use reputable suppliers when sourcing. “There are plenty of stock clearance sales to be found online that offer cheap produce, but you have to ask yourself why it’s in a clearance sale,” he says. “It may have short dates or be damaged, plus it may not be fit for sale in the UK. Using someone legitimate ensures quality produce that retailers are able to sell legally and without worry.”

As well as looking for a new supplier, Surjeet is exploring other options for US products. “Snacks and cereals are areas I want to look at,” he says. “I think Cheetos crisps would be a great fit for us and could do really well,” he says. “Once the supply issue is sorted out, it’ll be the next area I look at.”

Beyond confectionery

He’s not the only one interested in expanding their US stock. As well as having a shelf of US confectionery in his Hassocks store in West Sussex, David Knight has seen success with a display of American products in his Henfield store that takes in a variety of categories including cereals, cake mixes and soft drinks. Prices of £1 for a 330ml soft drink can and £5.99 for a box of cereal and good margins mean that the range certainly justifies the space it takes up.

“I introduced them for 4 July last year and they did well, so I kept them as a permanent fixture,” says David. “They’re very popular with customers and are a novelty to have in the stores.”

He recommends that retailers should experiment with American grocery as it can defy expectations.

“It’s tricky to plan out which products will do well as you can’t predict what customers will go for,” says David. “Our one shelf in Hassocks sells better than the display in Henfield so we have to try to get the balance right and try new things as often as possible. It’s worth having in both stores, though, because there’s nothing else like this nearby.”

Curzon-Price agrees that US grocery products can also be lucrative sellers. “We trialled some confectionery and cereals in a store thinking that the confectionery would be the main draw, but it was the other way round and the cereal flew out the door,” he says. “It’s something a bit different, or a product they may have seen on TV or tried on holiday that attracts customers. It’s different for every store so it’s important that retailers look at their customer base and sales to see what type of US products would do well in their store.”

While not all US products will work in every store, there are huge benefits to be gained from trying them out, including strong price points, creating a talking point and offering something different to your customers, with an entry level detemined by you. So why not mark 4 July by experimenting with American products in your store?

Why energy shots failed to make the crossing

Not every product that does well in the US will have instant success here. Energy shots were at one point growing by 483% year on year in value sales in the US, with new variants popping up every week.

Hoping to emulate the success of 5-Hour Energy, which was the first to market back in 2004, Red Bull, Lucozade, Monster, Relentless and Boost among others launched their own shot in the UK, backed by big campaigns and high expectations.

Unfortunately, this didn’t come to fruition and energy shots’ potential was exhausted in less than 12 months, with brands quietly exiting the market. Was it the price point, which could be as high as £1.79 at a time, when people were cutting back, or was it the lack of long-distance truckers that the product was originally designed for?

Boost founder and managing director Simon Gray said failure of energy shots was a disappointment for the industry. “It was an opportunity for innovation for the consumer and an opportunity for dual-siting of energy drinks in a store,” he says. “There was a huge incremental profit opportunity that was missed out on.”

Boost launched a 99p pricemarked shot in January 2010, which was on the market for nine months before production ceased. “Like other brands, we quickly realised that the expected uptake wasn’t going to happen,” says Gray. “There was a lot of confusion over usage occasions for the product and the size of the product meant that it got lost in the retail mix. Education about the product could have been better with brands working together to inform the consumer, but instead all the brands attempted to grab market share.”

Could energy shots ever make a return to the UK? Gray isn’t optimistic. “Never say never, but it would take a lot of work for them to make a successful return. There would have to be significant consumer education on the product and a reassessment of the price points for energy shots to have any chance.”