Increasing Share of Wallet

Right, wrong or indifferent, you need foot traffic.

The Wall Street Journal recently reported, “The pain at the pump is hitting not only consumers but also the owners of America's roughly 110,000 independent gas stations. U.S. gas consumption is estimated to be at an 11-year-low, at around 8.4 million barrels a day, down 4.3% from a year ago.”

For many independent operators, this is a daily challenge. The correlation between less gallons pumped equating to less inside sales is not always an accurate barometer, but in most cases it is. Right, wrong or indifferent, you need foot traffic. Often as gallons drop and inside sales follow suit, operators resort to increasing the retail prices of their merchandise and food service components. Sometimes this is done to dire effect as it can often reduce the average ticket and basket purchases, resulting in a significantly reduced share of wallet. 

An often more positive and effective way to increase share of wallet and improve conversion rates [converting customers who enter store] is to focus on suggestive selling. And, I do not mean just placing a box of chocolates on the counter. I mean developing a suggestive selling program with carrots and sticks. Suggestive selling is rewarded, but not suggestive selling is treated like coming up short in the register after the days shift. Have you been to Walgreen’s lately? At my local store, it is hard to leave without being suggestive sold during every visit.

Why is suggestive selling so powerful, and why should it be a focus of every independent operator? I can think of so many reasons why, but two simple ones are:

  1. The customer is already in your store and
  2. It is a lot easier to sell to someone who has chosen to shop in your store than it is to get someone who is not into your store.


What is the impact and how simple can it be?
If you are averaging 1,000 customers a day through your registers in all profit centers and you suggestive sell every customer a large candy bar maybe you will hit 25% or 250 customers. If the candy bar is retailed at $1.79, the math would work out to:

  • 250 customers x $1.79 = $447.50 in additional daily sales
  • $447.50 x 7 = $3,132.50 in additional weekly sales
  • $447.50 x 30 = $13,455.00 in additional monthly sales
  • $447.50 x 365 = $163,702.50 in additional annual sales

Wow, now that is an impact!

{Editor's note: The mentioned Wall Street Journal article can be found here. Access may be limited to Wall Street Journal subscribers.}

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