Some wholesalers are shunning established retail clubs to go it alone, writes Nikki Allen
The evidence is stacking up that symbol groups are the future of c-stores, with research from IGD at the tail-end of last year predicting they will account for half of all convenience sales by 2020.
“Symbol groups provide independent retailers with support across a variety of areas, from product ranges and marketing to IT and logistics, helping them deliver an excellent convenience service to local shoppers,” says Joanne Denney-Finch, IGD chief executive.
But there are many retailers out there who, while they want to grow their business and know that regular promotions boost footfall and sales, simply aren’t willing or ready to lose some of their independence by joining a symbol.
And it’s for these retailers that offering a strong retail club is hugely beneficial, helping them fight competition from the convenience multiples and discounters – while helping you grow loyalty from your retail customers.
“The bottom line is running promotions in a disciplined way helps retailers drive footfall,” says Mark Bottomley, retail club manager at Bestway Group, which has recently added a range of incentives to its Xtra Local promotional club. “We are targeting new members in-branch, with depots featuring recruitment banners and distinct Xtra Local promotional areas.”
This proactive approach to driving retail club membership is echoed by Andy Whitworth, Parfetts Cash & Carry’s head of customer development. His main focus is to develop the wholesaler’s highly successful retail club, Go Local, and boost its members’ compliance. The club has increased its membership in substantially over the past two years.
“Go Local has been designed to boost retailers’ footfall with strong promotions on a wide range of products, covering everything from household goods to grocery items to off-licence,” says Whitworth. “Our members also have access to special one-off deals and bulk purchases, which allows them to offer the consumer great discounts and price promotions. We are currently updating the club’s offering to provide an even better promotional package.”
To drive membership, he explains, there is a dedicated Go Local support team at each Parfetts depot to offer advice and assistance. Also in-depot are manufacturers’ display stands and point-of-sale (PoS) material, as well as launch offers on own-brand lines.
“The retail club has been running so successfully for the past eight years, that we recently decided to create our first fascia for independents, Go Local Extra. We plan to have at least 150 retailers by the end of this year.”
Meanwhile, wholesale giant Today’s Group is still reaping the rewards of launching the first national retail club in the sector in 1999. Craig O’Connor, managing director of Today’s Group member DeeBee Cash & Carry in Grimsby, points out: “As major retail giants continue towards a position of real strength in convenience, there’s never been a more crucial time for independent retailers to produce the goods.”
Compliance is key
The Today’s Retail Club supplies three-week promotional deals 16 times per year, backed up by consumer leaflets for local distribution and PoS kits themed to each promotion. For DeeBee, one of the most important factors in the success of its implementation of the Today’s Retail Club in-depot is its focus on sticking to the guidelines set out for retailers, which are designed to help them get the most from promotions.
“All our retail club members must, for example, support each exclusive retail club promotion, as well as prominently and clearly display all relevant pricing and PoS material in stores,” says O’Connor. “They must also ensure they don’t split down packs, and agree to sell all multipacks and ‘buy one, get one free’ deals as directed.”
But you don’t necessarily have to stick with the promotional club on offers from your buying group. In fact, for some smaller or more specialist wholesalers, for example, these clubs might not provide the best possible promotional package for your retail customers, and, as one wholesaler explains, it just takes a little creativity and motivation to go it alone instead.
“Although we are a member of the Landmark buying group, I decided to set up my own retail club, Time-Xpress,” explains Sony Bihal, managing director at Time Cash & Carry. “We have our own approach to promotions and instead of following any specific mechanism for deals, we simply go ahead and talk to suppliers and come up with our own.”
The club, he says, helps members compete with the major supermarket chains on price for a majority of the year, while making more cash profit – a no-brainer for retail customers. And thanks to its success, he has extended this approach to his on-trade customers, too, with a club that offers similar competitive promotional deals.
All this goes to show there’s not just one way to grow your retail club – with a host of options out there, from your buying group or setting up your own, there are promotional possibilities for every wholesaler to tap into.