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Top 10 Convenience Retail Trends to Expect in 2014

Convenience Trends 2014

According to IGD research the convenience retail industry is set to grow by 29.8% over the next five years, taking its value to £46.2bn. In this article, we take a look at what trends convenience retailers should expect to see this year.

1.     More value

Despite the more positive economic outlook for 2014, households are still feeling the pressure on their shopping budgets. This year we should expect to see an increasing number of savvy customers, looking for the best value products and discounts wherever possible.

2.     Social Media

Customers are turning to social media to drive their shopping decisions and find the best value products and discounts. Developing relationships with customers not just in the c-store but also online will be key for convenience retailers in 2014.

3.     Showrooming

Customers are constantly comparing prices online (home delivery) and in-store. Convenience retailers will need to work hard in 2014 to lure customers away from online offerings from supermarkets, demonstrating the value of the local c-store.

4.     Growth of Multiples

Sainsbury’s will have more c-stores than supermarkets this year and we should expect this trend to continue amongst other supermarkets, such as Morrison’s who hope to open 100 c-stores in 2014/15.

5.     Convenience meets discount

Booker, the wholesaler behind the Premier symbol group have launched the “Family Shopper” concept which combines convenience and discount to meet customer needs. We should expect this industry development to continue in 2014, particularly as discount supermarkets Aldi and Lidl have seen a successful 2013 with their discount c-store offering.

6.     Fresh Produce

According to IGD, fresh fruit and vegetables are the fastest growing category within the convenience retail industry. Convenience retailers will be looking to showcase their fresh produce this year with innovative methods to attract customers’ attention.

7.     Click and Collect

A trend which started in 2013 and set to rise this year, customers are taking advantage of the ‘convenience’ of Click and Collect, allowing them to purchase goods online and collect them in a local c-store – offering c-stores the opportunity to entice ‘click and collectors’ with their in-store offerings at the same time.

8.     Food-to-go

Food-to-go accounts for 15% of footfall in c-stores and is set to increase. C-stores will be taking up the opportunity of offering breakfast and dinner food-to-go options as well as lunch time offerings this year.

9.     Fuel retail

With c-stores providing more revenue for oil companies than fuel, we should expect to see a rise in convenience retailing at fuel stations in the coming year. Supermarkets are also looking to profit from this trend with supermarkets including Asda, now offering some of the cheapest fuel in the UK paired with a smaller Asda store.

10.   Growth in technology

As familiarity with new forms of payment methods grow, we will be seeing a greater demand for more flexibility and ease of payment in 2014. C-stores will need to adapt with payment options including contactless payments, in-store Pay Pal and mobile payments.

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Major Trends within Convenience Retail

Shopping wall

With an increasing number of consumers shopping little and often, the world of convenience retail has not only experienced growth but also change. There have been a number of key developments within the convenience store sector including:

  1. Expansion
  2. Food to Go
  3. Click and Collect
  4. Integrated online shopping experience

 

Expansion

The growth of convenience has not gone unnoticed by the multiples and this has meant that they have sought to expand within the convenience sector, acquiring sites in order to capitalise on the convenience industry. We have seen this in the UK with Morrison’s MLocal as well as Sainsbury’s Local (amongst others). However, this development is not just limited to the UK.  Multiples such as Reitan and Valora in Europe have also grasped this opportunity. They have expanded through acquisition, with 72.3% and 85.0% year on year uplift in store numbers respectively in the year to June 2012 [Verdict Retail ‘European Convenience Retail].

Food To Go

Increasingly consumers are turning to their convenience stores to grab a quick bite, be it for breakfast, lunch or dinner. Convenience stores have come on leaps and bounds within this category, creating stores whose sole purpose is food to go, with express check outs and in-store microwaves. There has also been a shift in competition with some c-stores viewing McDonald’s and Starbucks as the main competitors to their food to go options.

Click and Collect

Many convenience stores have taken advantage of integrating online shopping within their stores. Click and collect offers customers the opportunity to order items online but then to collect them from a locker within a c-store. There is then the possibility for them to stock up on any items they may need at home within the store.

Integrated Shopping Experiences

Further ahead, convenience stores are at looking at enticing customers through shopping walls in areas such as train stations. Customers can then choose items on the wall via an app which they can then pick up at the end of their commute. The walls are also designed to encourage customers to plan their next meal and what they need to buy.