The Innovation in Convenience session, which took place on The Convenience Store Stage at the National Convenience Show was jam-packed full of useful strategies and smart ideas, thanks to our panel of leading retailers.
Louise Moreland, head of trading at Greens Retail, which comprises 21 stores based in Scotland; One Stop retailer Dee Sedani, who owns three stores in the East Midlands area; and Josh James, managing director of Fresh & Proper in Fordham, Cambridge, discussed how they successfully innovate in-store.
1. Fail first to succeed later
“We have failed and I’m not ashamed of it, because I’ve actually learned a lot,” says Dee.
He claims that a milkshake machine he launched last year didn’t have the impact he was hoping for. “‘Why did it fail?’ We asked the customers,” says Dee. They fed back that the products weren’t tasty or thick enough.
Dee took their comments on board and spent £3,000 on new kit to make his own milkshakes fresh in store. “We’re going to make milkshakes with proper milk and proper ice cream,” he says. Tester samples of the new milkshake have proved a big hit so far.
“That’s going to be a 71% margin,” he says. “So I think start off with something basic that has failed, reevaluate it, and find a simple solution.”
Louise explains that sometimes a small adjustment can turn a struggling product into a winner. “Sometimes it’s just not quite performed, it just needs a little bit of work to get to where it needs to be,” she says.
“Sometimes it’s just down to the need to source better if you can. That might be the difference between making your margin and not making it.”
2. Simplify staff communication
Greens Retail was using multiple communication channels to message staff, which, over time, had become difficult for everyone to keep on top of. “We are guilty before that there were emails, there was WhatsApps - it was quite messy,” says Louise. “So we’ve invested in a communications platform. We have a monthly call for all. So across our entire Greens business, everybody jumps on this call and that’s an update of basically what’s coming in the next month.
“And whether that’s new products, if it’s new stores in some cases, if it’s new trials or like if we’re looking for feedback, there’s a kind of live chat in there as well. So that whilst whoever’s discussing it, we can get points backwards and forwards.”
In addition, Greens put a poster up in the staff rooms with a QR code on it that team members can scan and then leave a comment. “So if a customer came in and said they want a different wine or something, somebody could scan it really quickly and send it through to us,” she explains. “The idea was just to try and simplify that process entirely and we can go back quite quickly with, ‘yes, we can source this’.”
A QR code is also set to be rolled out to the shopfloor to encourage customers to make suggestions and provide feedback.
Josh adds that simply listening to staff and observing them can help you think of improvements. “I think the best thing to do is to sit there and watch them, listen to them while they’re at work and listen to what they’re struggling with,” he says. “Think: could you change that?”
This approach has led to Josh making adjustments to the till heights and introducing headsets to help his team operate more efficiently.
3. Give your team ownership of new concepts
“One of the ways I try to work my stores is put the ownership of the store onto the managers,” says Dee. He instils this notion even at the recruitment stage. “My managers will tell you they’re part of my family, so when when we train them up or when we interview them, we want them to understand that this is your store, this is your vision, you implement it how you want.”
By inviting his team to partake in the evolution of an idea, Dee finds that they are far more willing to embrace it. “Don’t drag it [a new idea] along - let your team get involved. That’s what I believe,” he says. “Let the team talk to you about the challenges of labour, of whether it’s going to work.”
Staff at his Packmoor outlet now organise their own rotas in order to ensure that there are enough trained staff on hand to manage Dee’s new freshly baked cakes concept.
If they believe in an idea, they will try harder to make it work, he claims. “Primarily, because they’re the ones that are doing it, so I want them to be comfortable. If they’re putting the passion in, that will show in the sales.
“When I go back to them with a new idea, I know I’m going to get pushbacks, but when they go and see it touch it, feel it in another store, they’ll come back out, excited thinking, OK, how do we do that? Reinvent it, make it simpler or easier and put it in our store.”
4. Set out your key success measures ahead of new product launches
Greens sets out its expectations and targets for new products ahead of time, so that the team can quickly analyse whether or not an innovation is successful. “Before we launch something, we try and have a success level set for it,” says Louise. “ … that might be what I want my sales to be, this is the average margin I need it to be, this is what my labour costs need to be. Just knowing that before you start gives you a kind of baseline to then make a decision if it worked or not. It makes it quite easy to then tell if it’s miles and miles below it [target], we know we need to do some major work and [decide] if we just pull it.”
It’s important to take additional factors into account beyond the product itself, notes Josh. “It’s almost a data analyst role,” he jokes. “You can see the direction it’s going in quite early on.”
He is mindful of cannibalisation when introducing new lines. “It might be that it’s only growing because I’m losing it in a different department,” he says.
With seasonal products, the weather also needs to be taken into account, he adds. “There’s so many things that factor into it. If it’s a new product, you have to give it a couple of months at least.”
5. Use tech to tackle compliance
“Most innovation in the store so far is efficiency driven,” says Josh. “I think the idea of being able to go paperless isn’t that far away.”
Staff use tablets on the shopfloor to photograph invoices. The tablets also prompt staff to carry out tasks, such as checking the sausage rolls or reminding them to do reductions.
Josh spends less time ensuring that staff are adhering to food safety rules because rather than having to manually check the paperwork, he receives notifications direct to his phone as tasks are completed. “I’m getting buzzes in my pocket to make sure the staff are doing all the HACCP (Hazard Analysis and Critical Control Point) compliance,” he says.
He claims that it saves him a lot of headaches around red tape. “Yes, you could say that I might be micromanaging, but I think it’s the peace of mind for me, being new, and all the rules and regulations changing constantly.
“The next step for us is [electronic] receipts and we found a partner for that. So that customers can tap their phone and get the receipt on the phone and then there’s rewards through it.”
6. Intuitive pricing could unlock extra opportunities
Another way to optimise sales is, of course, by altering a product’s price and innovative technology in this field is opening up more options. “If you could let the store almost dictate the pricing of the product based on what it’s selling and whether that product should even be on the shelf, that’s the future,” says Josh.
“We have ESELs [electronic shelf edge labels] in the store already, but there are products out there that can intuitively look at the sales and then adjust the prices on the ESELs based on how they’re selling. We have the flexibility in the model to do that with Morrison. So it’s quite exciting.”
He is also using data analysis to reduce wastage via Ganderlytics. “There’s a part of Gander which looks for the waste, looks at the sell out time, the time of reductions etc to see ‘are you reducing this too much’; ‘are you ordering too much of this?’
Josh visualises that this intelligence could be used to offer customers bespoke promotions. “You can go one step further with the data and then log which customers are buying those products and then send them intuitive deals as well,” he says. “So you can tie it all very well together, but it’s a huge project.”
The ultimate aim of getting the tech to do the work is that it frees up his team to take on more community-based roles. “I want to take that away from the managers because I like them to be seen on the shop floor and being the face of the community, going out to local charities, local schools and I don’t want them sat by the desk any longer. If tech can take that role, I’m definitely going to go that direction.”
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