Become masters of the meal deal

What kind of meal deals do you offer?

Josie: Our deli counter closes at 2pm so the focus for our meal deals tends to be on breakfast and lunch. We do sandwich deals with water or salad to keep up with the health trends, at about £3-£4. We also do deals on breakfast wraps with a coffee, and coffee deals with muffins and doughnuts, too. People can also get a deal if they buy one of our bacon or sausage baps with a hot drink. Away from food to go, we offer two for £5 deals on chilled ready meals and a two for £7 offer on some of the more premium, local lines, or meals from our Stanleys butcher concession. Customers can buy three for £10 and the range includes things like chilli or curried chicken and turkey and ham dinners.

Rav: In terms of meal deals, we only do the £5 frozen one from Nisa at the moment. We used to have an external sandwich provider who did all our lunch deals, but we decided to switch things up. We will look to re-introduce some new sandwich deals in the near future.

Jodi: We do chilled meals deals, deals on food to go and frozen foods. We get a lot of families in so there is quite a bit of demand.

Nigel: We try to keep our meal deals as healthy as possible so we do things like a sandwich with a banana, orange or an apple – our main focus is on food to go. We have two schools close to us so we need to offer kids an instant breakfast and lunch option that they can take away with them.

What meal deal products are most popular?

Josie: We find that when the weather is good people will go for the sandwiches. Having a soft drink alongside also does really well. However, when the weather is cold people just want something quick and easy to cook at home so our chilled meals do better. We try to change as much of our range as possible throughout the year. We’re bringing in some new flavours of gourmet sandwiches for the summer and we’ll be adding other items throughout the quarter to give customers variety.

Rav: We always see an increase in demand for any product that is included in the frozen deal, and this changes depending on the Nisa leaflet. The deal is updated every three weeks and even if the flavour of pizza or ice cream is the only thing that changes it is still popular. The meal deal mechanic has really helped to keep frozen sales up and made the category more mission based, which is much more efficient for retailers.

Jodi: Pizzas usually do quite well because they come with chips and a dessert when part of the frozen deal. Our chilled meats also sell well as part of a deal; we do offers on things like spaghetti Bolognese that includes mince, sauce, peppers and pasta needed to make the meal at home, usually priced at about £5.

Nigel: It tends to be the sandwiches and bananas that sell the best. The sandwich flavour we sell the most of is ham & cheese, which doesn’t sound very exciting.

Which meal occasion has the most potential for growth?

Josie: I think lunch still has room to grow. Our gourmet sandwiches have done really well and sales from our deli bar have grown by about 50% year on year. We used to do about £400 a week, but now we’re up to £1,100. We get lots of builders who make a beeline for the gourmet sandwiches made by our deli team. We offer these alongside the smaller sandwiches for those who just want to grab something to go. We want to cover all bases.

Rav: We don’t have any high street stores so we found that the lunch deal wasn’t really working for us. Most customers are out of the area at lunch and pop in on their way home, so for us it is more about dinner and meal-for-tonight options.

Jodi: There is definitely more we can do to take advantage of the meal-for-tonight trend.

Nigel: Lunch has room to grow. We tend to get the same kids coming in for breakfast and they usually buy the same thing like a filled roll, fruit and either tea or water. Lunch tends to be far broader and offers people more choice. Not only do we get kids coming in for it, but we also get people from across the local area.

Which suppliers have helped you with your meal deal offer?

Josie: We mainly work with the Henderson Group (Spar). It now has its online ordering system up and running which makes it much easier. It also allows us to respond more quickly to customer demand. We recently brought in a new range of gluten-free cakes to replace our bars, because customers preferred to have fresh free-from options. The response to the products has been really positive so we are looking at what else we can add to the range this year.

Rav: Nisa looks after the deal and we always know when the stock is coming in so we can prepare for it ahead of time. The support and POS we get from them works well, too.

Jodi: We work closely with Londis which controls most of the meal deals. It is quite easy for us to get in touch if we have a problem.

Nigel: We work with Nisa, which supplies us with all our sandwiches and fruit. We get a great service and receive deliveries every day. We can order things the day before and it will usually be with us the next day.

How do you merchandise the elements that make up the deals?

Josie: We use quite a lot of POS including bus stops and shelf cards to signpost all our meal deals. We also change our displays on a daily basis and merchandise items like coffee and muffins next to each other. We always have an open chiller at the front of the shop for our Madigans-branded sandwiches. Our gourmet sandwiches are displayed a bit differently because they are all made fresh and people can add things to them as they would in a Subway.

Rav: We use POS to make it clear to customers what the deal includes. Our frozen sales would definitely take a hit if we didn’t have the deal so we rely on the fact that everything looks good and all the items are in stock.

Jodi: We dedicate a certain amount of space to each of our meal deals. The whole right side of our chiller is set aside for meal deals so customers can pick everything up from the same unit. We have three shelves just for items included in the food-to-go meal deal, and the same for frozen. All of the displays are sign-posted with lots of POS and barkers.

Nigel: Our meal deals are displayed as part of our general range so things like shelf barkers help to let customers know about them. They can then go to the main chiller and soft drinks fixture to find the sandwiches and waters included. All our fruit is at the front of the store so people can pick it up really easily.

How do you plan to evolve your meal deal offer?

Josie: We are constantly changing our range throughout the year. We also want to improve it and listen to customer feedback to see where we can take things next. We are planning to invest in a self-service bar later in the year which will allow people to make up their own meal deals using lots of different ingredients and spices. We’ll still keep our current deli counter to give people the option to be served by someone, because some people just want to have a chat and spend a bit longer in the store.

Rav: The main thing is to look again at our sandwich deals. When it was done externally things were a bit more rigid, but now we can experiment and figure out what fillings, breads and formats should be included. We need to look again at whether we can do more specialist and premium options.

Jodi: Quite a bit depends on Londis as it tends to manage most of what goes on with our meal deals. We can do alternative deals if we have the space, or need to sell through a particular product, so that works if we need to make any extra margins. I think it would be good to do a few more food-to-go deals such as a coffee and a doughnut or a coffee and a snack for £1. That’s something we need to suggest to them.

Nigel: I would like to move away from sandwiches and replace them with healthy wraps. The only problem is that they aren’t so widely available, so quite a lot depends on whether we find a good supplier. I would also like to offer more imaginative flavours and that is something we can develop. When you look at what M&S does with its food to go, it is all about healthy salads and sushi. It would be good if we could work with someone who knows about smaller stores and do something similar.

What advice would you give to other retailers looking to improve their meal deals?

Josie: Advertising is the key thing, and making sure the staff are knowledgeable about the deals. You want to offer customers the best value so they see the benefits of coming to your store. It is also important to review meal deals. This might mean looking at your margins to see if there is any room to make the deal better. That’s why we introduced a two for £7 option alongside our three for £10 offer on our chilled meals, because people want the option to buy a smaller amount and still get a good deal. We also want to offer variety with healthy products included as well.

Rav: Site the deal separately to the rest of your range and use lots of POS and barkers on the fridge doors or cabinets to let people know about it. It is more about presentation than anything else.

Jodi: Sometimes it’s not about getting a brand name into the meal deal. An own brand can be just as effective at selling a meal deal.

Nigel: Make people aware of what you are doing. It’s not a huge investment for us to offer meal deals because we sell the products anyway. Even if it means giving away some extra margin, it is still worth it for the sales and getting people to come back on a daily basis for something fresh.

Which deals are most effective at increasing footfall and basket spend?

Josie: Our fresh meal deals are those that drive footfall, which is why we offer a range of different pricepoints.

Rav: The frozen deals that include things like pizza, ice cream and a side drive the most sales. It is really difficult to pin down one type of customer who is buying them because when there is a good deal everyone goes for them.

Jodi: To increase basket spend, the frozen meal deals are good because customers get quite a few items for £6. The chilled deals and sandwich promotions are the best for footfall as they bring people in throughout 
the day.

Nigel: We only do offers on food to go because they are so popular and do really well for us, especially at breakfast when all the kids come in before school starts. Most of them come in early, probably because they have been sent on their way by their parents. This is why we offer them something healthy like a piece of fruit. We don’t include soft drinks in any of our deals because we try to avoid all the sugar-ladened stuff when selling to kids.

What kind of margins do you make on your meal deals?

Josie: We make 25% and above on most products and a bit more on the Daily Deli range, which offers us margins of 30-35%.

Rav: We don’t look at the margins of the total deal because we know that we are making money on the individual items. It’s just about getting customers to buy the products and boost footfall. The deal is £5 on its own so if people buy other things to go with it then basket spend is going to go up.

Jodi: We make roughly 25% across all our meal deals. We promote them with in-store events if we need to, and always have leaflets and posters at the front of the store and next to the till so customers know what’s on offer. The deals change each month so it is important that we communicate this to shoppers.

Nigel: We make slightly less on our sandwich meal deals than we would on a single sandwich, which offers us a 35% margin, but we still make 28% which is really good, especially when most of the time you are selling three items instead of one. We have posters and POS up in the store and outside as well so it brings people in. I think retailers always want to find something that will differentiate themselves from other stores, and meal deals are good at making sure customers aren’t tempted to go elsewhere.