Product Selection is Key to Taking Advantage of Industry Trends

Welcome to the newest post in our blog series, Darren’s Great Ideas! for Independent Operators. 

Product Selection is Key to Taking Advantage of Industry Trends

The number of people struggling to pay for food has remained relatively unchanged according to most experts from 2010 through 2012. This fact impacts our core customers as well, as they cut back their in-store spending to ensure that their families back home have enough dollars in the bank.

With this in mind—Are your retail sales over last year up because you are selling more merchandise to more customers, or have price increases impacted your performance to the point where fewer customers are paying more? As fuel retailers we know this all too well, hence why we focus on gallons, not revenue, for sales of fuel products. Dollars are important, but units and gallons sold are as important as it outlines the health of our customer visits.

Retail and grocery establishments are experiencing a customer who is bombarded by more media inputs than ever before and it would be wise to believe that our core customer is no different. Certainly the traveling public, whom often make up the largest percentage of our distinct transaction counts in our locations, is experiencing this phenomenon.

With consumers shifting to spending their money in a handful of channels as they make more purposeful trips to spend their hard earned cash, our industry should expect this to impact our sales.

Keeping the above comments in mind, consider the following:

1. Selection becomes critical. Drill down in each category to review how each item in the category is performing. Using your data, increase selection on your fast-turning items and decrease selection on slower performing merchandise.
   Example: From your truck supply category, ensure you have the critical products that make up the growing cellular category in your sets even if it means you have to double face the key performers. If you have limited space, it is even more important to provide adequate "available for purchase" key products even if you have to eliminate those products that straddle the line between a decent performer and a good performer. Being out of a top performer is much more devastating than having the decent performers in your sets. 
   
   
2. Reasonably priced products supported by promotional opportunities that take advantage of time, season, events, and days of the week will boost profits.
   Example: From your sales floor, create promotions on weekenders, such as candy displays and chip displays, that take advantage of increased traffic counts to move BOGO products more briskly.
   
   
3. Have the right brands for your demographic to avoid turning people away. You can reduce unproductive merchandise without hurting performance and ensuring that the right brands are being sold…
   Examples: Do you need to offer Bob’s Ginger Ale and Canada Dry Ginger Ale? Do you need to carry Joe’s microphones and Astatic Microphones?
   
   
4. Increase your easy-to-eat grab-n-go food items that can be eaten on the run. Eating times continue to blur as we get busier and busier and so it is smart to offer more mini-meals that reduce the overall spend of sitting down and eating a full meal.
   Examples: I spoke about popcorn a couple of weeks ago. Kernel popcorn is said to be up 8 - 9% over same sales last year. Or from your reach-in coolers, try Lunchables cheese & crackers, yogurt, cheese sticks, and carrots. Do not get lost behind the continued movement towards portable consumable foods. Consumers have less money and less time and our industry is poised to take advantage of this continuing trend.