Take the lead

Who is your local competition?

Lesley: My immediate competition is a Co-op convenience store about three minutes’ walk away, and then there’s a newly opened Tesco Express about 10 minutes’ walk away in town - it’s the third Tesco in the area! There’s also Lidl, Sainsbury’s and another bigger Co-op on the high street.

Conrad: In Pwllheli, where my forecourt and Spar stores are located, there’s an Iceland, a Lidl and a Co-op, Asda, a Wilkinson, a Premier, a Costcutter, two CTNs, a fishmonger, a butcher and an off licence.

David: We’re in a rural setting at a crossroads between half a dozen villages on the outskirts of a market town. There is a Co-op and Morrisons in town, which are both under 30,000sq ft.

Saki: Our Gateshead store has a Costcutter and a few unaffiliated independents nearby, and a Tesco Express opened three months ago. Around our Ashington store, there’s a 24-hour Asda, a Poundstretcher, Poundland, an Aldi and a Lidl.

How has competition changed in your area in recent years?

Lesley: Asda is coming and the authorities are still deciding on whether there will be a Morrisons as well. There was a retail impact study before the Asda arrived, which sided against it, but it still got the go-ahead.

Conrad: There are a lot more bargain-style stores around - Iceland is aggressively priced and Lidl has such strong discounts, as do Wilkinson and Asda.

David: The local Somerfield became a Morrisons and online ordering has started up. We see a few home delivery vans, but in Lincolnshire we take our time to get up to where everyone else is, so online ordering isn’t as prevalent as it is in other areas of the UK.

Saki: Poundland came to Ashington a year ago, and then the Poundstretcher came and took over the Ugo food store in the area.

Has local competition altered your expectations for business growth?

Lesley: The Tesco Express opened last Wednesday and it doesn’t seem to have affected our trade so far. You wouldn’t go into town especially to use it you’d only go there if you were already in the area. When the Tesco Extra opened about three years ago we had a small extension and that helped to offset any 
lost trade.

Conrad: Because we’ve had good weather, we’ve had a good summer, but it hasn’t been a record-breaker because there is more and more competition.

David: No, our store is still performing steadily. We just concentrate on our promotional activity to remain competitive.

Saki: At Gateshead, our turnover dropped 20% when the Tesco Express opened, but now it is only down 10%. I think we will be able to regain this over time. However, it is getting harder and harder to expand because of the mults. It’s very difficult to find good sites in good locations. In Ashington we’ve seen a 20% increase year on year and we hope to achieve the same levels of growth next April.

How do you track what your local competitors are up to?

Lesley: I go periodically to the big supermarkets and look at their prices. We also get the Co-op leaflets.

Conrad: I go to the shops in person and see what they’re doing, and look at the leaflets.

David: My wife is an avid Waitrose shopper, so we go there regularly. I’m an admirer of its presentation and pricing. I’ll also pop into Tesco to have a look at what it is doing.

Saki: It’s not about keeping track of them so much, but about buying smarter and keeping our prices low over a long period of time. The margins are in buying, rather than in store.

What are your competitors doing to drive sales and footfall?

Lesley: They sell more meat, veg, fresh fruit and alcohol at the nearby Co-op so you could just about do a full shop there. On its last refit they made the shopfloor smaller to measure under 3,000sq ft so it could increase the opening hours.

Conrad: Deep discount promotions - just massive stacks of stuff on offer. Asda sells bakery products at prices we can’t even buy at wholesale.

David: The reason they get good sales is because they present an image of having the best prices. The biggest driver of all, though, is shopper habits - if people can buy something quickly and then go home, they’ll stick with it.

Saki: The discounters offer bulk products for low prices and the Tesco Express isn’t competitively priced, but creates the perception that it is. When the store first opened, it ran a ‘spend £10, save £4’ deal. But that only runs for the first few weeks, to get people into the habit of going there.

Have you used any of their ideas?

Lesley: We haven’t used anything specific, but we would if we thought it was a good idea.

Conrad: We’ve created a ‘wall of value’ at the front of the store full of pricemarked packs from AF Blakemore. Everything is pricemarked or on promotion, such as Kellogg’s Crunchy Nut for £1 and a 12-pack of Whiskas pouches for £3.

David: We’ve taken on how the multiples site items together that would be eaten together. For example, we’ve had a Sunday roast next to an ambient display of potatoes and veg and gravy.

Saki: We’ve introduced case prices for crisps at Ashington, so you can get 48 packs of Skips for £2.99, which is much better value than a multipack. We also do similar offers with soft drinks and confectionery. If we don’t give customers these deals, they’ll go to the discounters.

What are you doing to remain competitive?

Lesley: We’re changing our promotional bay more frequently to align it with different periods. For example, we’ve just run a back-to-school bay with pens and paper, and before that we filled it with footballs and hula hoops to coincide with the kids’ school holidays. We’re trying to increase basket spend it was £2.75 and we want to make it £3.

Conrad: We’re advertising on TV. We time it to run during key local events throughout the year, such as the Royal Welsh Show. In addition, we have bespoke leaflets and our own Facebook site, where we are promoting ourselves as a family business. We’ve also just done our annual Welsh Food Fortnight, which was the biggest it’s ever been with 12 retailers taking part. We also continue to invest in our stores. At our forecourt store we’ve introduced a Costa Coffee offering as part of a mini refit. Before, we were making £550 a week selling unbranded coffee at £1.29 a cup, and now we’re selling Costa at £2 a cup and turning over £1,500 a week.

David: You have to make sure the standard of presentation is as good as the best mults. We’ve always been aware that you have to try new things regularly and look at things with fresh eyes. For example, we used to just have sugar in the baking section, but now we site it with coffee, too.

Saki: We have introduced a Polish range, which is doing really well. In addition, we are sponsoring a local football team to build our presence within the local community.

Where do you look to for advice on how to compete?

Lesley: I often pick up advice from trade magazines and from speaking to retailers at events.

Conrad: We’ve hired someone to manage our marketing, and we also read Convenience Store and get ideas from trips abroad.

David: Customers are as good as anything. We also read the trade mags as they feature the best stores. We see good ideas in stores when we’re abroad as well.

Saki: Trade shows give you a good idea of what everyone else in the industry is doing - you can see what equipment is being introduced and just spend time with other retailers.

What would your advice be to retailers who are concerned about local competition?

Lesley: Talk to your customers and see if there’s anything you can do differently, and check what the competition is doing and steal ideas! You have to make preparations if you know that a rival store is coming. It’s particularly effective if you can organise something during the week of the rival store’s opening, such as a raffle or promotion.

Conrad: There isn’t just one single solution - you’ve got to stand out from the crowd, see what customers want and implement it. Bringing other brands into the store, such as the Post Office, Subway and Costa, is also a good move.

David: Don’t give up - you just have to find a point of difference.

Saki: If you start building good relationships with your customers it will encourage them to stay loyal. Let the competition do what it wants and concentrate on your store standards and shopping experience.

What is the biggest threat?

Lesley: The biggest threat is the multiples. Online ordering and home delivery isn’t a big issue for us, although maybe this will change when the Asda opens.

Conrad: Tesco delivery vans - there’s a constant stream of them, even at the local caravan sites - and it’s taking business away. The off licence near me recently spotted 15 pass his store!

David: The multiples are the biggest threat.

Saki: The multiples and their aggressive expansion remain the biggest threat.

How can independent retailers work together to stay ahead of the game?

Lesley: Going to trade shows is a good idea - you can see new equipment and share ideas with other retailers.

Conrad: Being part of a symbol group is key. Blakemore has a conference this week, which will give me the chance to find out what other retailers are doing.

David: Joining a symbol group means your prices are more competitive and there is a marketing team to help your store appear more professional.

Saki: I try to work with Nisa members and I’ll sit down and have a chat with any who come to me. If I can share a good wholesaler or supplier contact, I’m happy to.