Archive for category Store Layout

Your store opening

A few weeks back I took new dealers in the industry to visit a few sites in the Sandton area inJohannesburg. For those that do not know this area – it is an extremely affluent residential and business area. So there is serious money around.

Many moons ago, I opened some of  these shops for the first time – so I knew the layout of some of the stores and of course what they looked like when we opened them. In hindsight that is probably the reason I was so disappointed in just about all of those we visited – regardless of the brand.

The only word I can find to describe them – is tired, looking lost and forlorn! So here is my question to you and your store?  Be honest now with yourself – does your store look as great as it did when you opened it to the public for the first time?

Here are some of the things that disturbed me on these visits:

  1. The pay point/s looked particularly poor. They were dirty and untidy and the fixtures looked like they needed some serious attention. How much could a few new shelves cost?
  2. Ticketing and labelling was non- existent for about 40% of the stores as a whole. The group had to physically count how many line items had no ticketing – so this is pretty accurate for all the stores we visited. This is an elementary retail norm – why can’t we get it right?
  3. The shelves looked or were perceived to be empty. In reality they weren’t – but because the products were not being brought forward it left the impression that the store was empty.
  4. And don’t let me talk about the condition of the toilets/rest rooms…

Ok so here are some suggestions for you and your store this week.

Firstly, take a good long hard look at your store. You need to be honest with yourself here. Because you work in the store all day, you no longer see it through the eyes of your customer. Why do you think it does not look like it did on your opening day? Why does it have the look and feeling of being tired and past its sell by date?

Secondly, take each area of your store one at a time. Start at the pay point – all your customers end up there – so that is your first priority. Is it neat and tidy? Is it clean? Look at the shelves – are they still looking the same as on the first day? Clean the shelves, the partitions, the merchandise, any stands, – in fact any surface that the customer comes into contact with.

Then move onto the sales floor. Try this for yourself to see just how easy this is to do. Walk up and down the aisles and just bring the products forward. Straighten up shelves that look untidy – make sure that there are no empty spaces on the shelf. Now look back and see the difference. Its as easy and as simple as that….you have already made the impression change from a store feeling empty to one that looks full.

Once you have done this get your merchandiser to fill in all the gaps. Get him /her to look at the price labels at the same time.

Now go into the store room –in retail terms we can always tell a profitable store based just on the condition of the store room. How does your one look today? It should be spotless, no papers or boxes lying around, no wrapping or packaging lying around. If you get your store room right the rest will follow.

Now take a walk into you cash office or back office. How does it look? Just because the customer does not see this office does not mean it does not have to be neat and tidy. Are there invoices lying around, till rolls and GRV’s lying waiting to be attended to? If so you know that they are behind in their work schedule – and this office is like the soul of your business. If that gets out of hand – you can bet your bottom dollar that you are losing money!

It should be neat and tidy with easy access to files – you should be able to find anything you might be looking for within a moment or two. Can you do this?

Many people in the retail industry talk about this as your store recovery. It is the simple act of getting your store ready to trade with your customers .It is the combination of several processes to make the store look and feel great. It is the continual process of preparing the store for its customers…

And it should be done on a daily basis!

 Take care out there

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Planograms – Do these make good business cents?

The challenge for me in this discussion is that I do not have the answer!
And this is because I am not entirely convinced that planograms grow sales or even profitability for that matter, at store level.
What is a planogram?
Essentially it is a diagram that indicates which products go on which shelves – and how many facings of each product need to be on each shelf. The diagram will indicate which variant of a product to stock, and which supplier’s products should be on the shelves.  I see planograms as vastly different to say a store layout – which is also a diagram. To some extent I think these are being confused.
A store layout tells you where to position your pay point, where the fridges should go, where chips, sweets and snacks should be displayed in your store etc. As such I see store layouts as infinitely more helpful to me as a retailer when opening a new store or revamping a store.  And even as you trade – you can review your store layout to better meet the traffic flow in your store. So a store layout can be very useful to me as a retailer.
A store layout will not show which variant of toothpaste to stock. It will indicate however, where toiletries as a category or department should be in your store.  The planogram will indicate actual line item, the colour, size etc – and on which shelf it should be merchandised.
Planograms are the end product of some sophisticated software (that in many cases costs the earth to use or buy outright) – into which all sales of all products are pulled into the system. The software then uses these sales to generate a product layout based on these sales.
So why am I not entirely convinced that planograms can work and drive increased sales at store level?
Well firstly it all depends on where the information is being pulled from. If it is from my store only – then I would concede that there might be merit in using a planogram. However, mostly because the costs of these programs is prohibitively expensive – Franchisors tend to collect information from its entire network  – to drive consistent planograms throughout its network.
Some are fortunate to get down to regional level – but even at this level of information I am not convinced it helps me at store level.
For one thing the information is historical. So it is based on sales that have already taken place either a week ago, last month or even worse – the last six months. And those of us that work on the ground know intuitively that our customers’ tastes continuously change.
I remember a few years back when a large supermarket in our country introduced planograms into their store network. Based on historical sales – planograms were sent out and store staff ordered according to these plans. However, in that particular year down here in the Western Cape – we did not have a winter season. So soups and bread were not the priority purchases that had been incorporated into the planograms. Instead customers were looking for a continued supply of fruit and salads!
The one positive thing that worked in this company’s favour – was that they owned the supply chain – it was not a franchised network.   They supplied their stores out of their own distribution centres. But it did incur some revision of their strategy in this regard – as the whole supply chain was treated as one business entity – so their suppliers and orders had to be reviewed quite quickly.
Those of you that have worked with planograms will know that it is not that easy to comply with product layouts sent to you. And I am sure like me – there will be those of you that look at the product selection and then say to yourself – but these don’t sell in my store! And this is a common complaint from franchisees.
So why is it difficult to implement store planograms on the ground if there is no central distribution centre?
There are a number of reasons why this is so.

  1. You don’t stock an item because it does not sell in your store or region
  2. You do not have the required fixtures and fittings in your store to display the products as depicted in the diagram. This is particularly true when you use pegs and hanging displays
  3.  You don’t sell that variant – your customers for example prefer strawberry yoghurt to vanilla yoghurt
  4.  You don’t like where that product has been positioned on your shelves as your margin on that product is very low
  5.  Your supplier is out of stock – very common in some regions in our country

And by far the biggest challenge for me is that we are basing our future product layouts based on information that may or may not be correct in the first place. They may not be a true reflection of what our customers are looking for.
In this regard a while ago I wrote about a product such as Jelly powder. It really only sells in one month of the year – and if you did not have it last year – it won’t be on the planogram for the next year’s sales.
Don’t get me wrong about those networks that have central distribution points. They too have difficulty in implementing planograms in their networks too – but it is much easier for them than say a franchised network that does not have a DC.
My feeling is that to some extent implementing planograms across a network run by franchisees is hard work for all concerned – and in the end, very few stores are able to comply fully to these at store level.
So my question is why bother in the first place?
I just don’t see the return on the bottom line – except of course perhaps for our suppliers?
Take care out there

Jocelyn Daly 

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The changing landscape of Convenience stores in South Africa

I am thoroughly enjoying the changing landscape of our convenience stores! It is like a breath of fresh air! New store designs, new product ranges – all hopefully showing improved profitability for all our stakeholders.

The effects of the JV’s, new supplier agreements and internal franchisor structures are all showing at store level. Exciting stuff!
BUT and here is the nub of it going forward. In the past two blogs I have looked at the coffee offerings out there in the market place – the same bean, the same expensive machinery, – with differing and conflicting offers to the customer. It is the PEOPLE that make it succeed or fail…..

Our staff, are the people that our customers interact with, and we have a dearth of good skills to choose from. More importantly as our sales have increased so too our dependence on not only good staff – but good managers! Many of you have been on one of my many training courses over the past 15 years or so – and training and skills development is one of my passions.

On my recent training courses over the past year or so, I am coming across fewer and fewer good management material. If we have poor managers – we have no hope of getting our staffing right!
I am not sure why this is so. I know many will tell me it is the BEE legislation that is restricting us in selecting good management material. But I know this is incorrect and too trite an answer. My last training programme had few if any previously disadvantaged representation which in itself was highly unusual – and they were generally shocking in performance and understanding of tasks. It is always easy to blame external factors – harder to look at ourselves and how we are to blame.
There are two extensions of this challenge. The one is the selection of staff at the coal face. The other is the impact on the shopping experience. Yes the stores look great in many cases but the shopping experience itself is boring as all hell. No music. Where are the welcoming faces? You ask for a particular product – just get a shrug of the shoulder if you are lucky! Even managers which you see hustling from one task to the other don’t seem to care. They have this blank look on their faces – please don’t interrupt me complete my current very important task! I had occasion this last week to see a very disorientated customer ask a cashier if they stocked a particular product – she shook her head and said she would ask her supervisor.
The supervisor turned out to be in the paypoint kiosk at the time – she did not even raise her head or look at the customer asking the question. She just indicated in her body language that they did not have the product in question. BUT they did – and I showed the gentleman where it was on the shelves and promptly lost my place in a very extensive queue!

And there are good people out there – I know. The fish rots at the head – and I spend most of time challenging you on staff selection at grass roots level. But it starts with us – you and I. And the level of selection just below us! Get that right and we might, just might, improve the level of service experienced by our customers at grass roots level! It starts and ends with us……
Take care out there!

Jocelyn Daly

A word from Max, social and website editor: We have many good downloads on http://www.cstores.co.za/ to assist with the managment of your c-stores! They will not be free forever! I have seen some of the information that Ms Jocelyn Daly gives out for free being sold for R2 000.00!

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Does Size Count

Well of course size does count – but it depends on what you do with it that counts even more! Large or small – it all depends on how you use it!

I was recently approached by an experienced dealer who has just bought a new site. The challenge he has is that he has about 50 square meters free space – to use as he sees fit.

The brand franchisor told him that it was unusable as it was too small. Now this is an experienced retailer – and his gut tells him this is nonsense. And I agree with him…

Ok so imagine he leaves the space empty. How does that help him draw petrol customers onto the site? The challenge today is supporting our total customer experience – not just filling the car. If you don’t have an offering, you cannot compete in the market place. I don’t care what your location is – and in this instance it is a great location. Highly visible, easy access in and out – and on a very busy intersection right opposite the railway station.

Location is not going to build volumes alone. Our market is becoming too sophisticated for that today. So why does the Franchisor say he can’t use it – is it too small? It is small for the franchisor offering, but that does not matter – we need to use the space in a more clever and sophisticated manner while still providing the basics for our customers. So how do you do that?

Well out go the walk- in fridges – or rear loading fridges- there is no space. Store room space will have to be in the roof and walls will have to be used very carefully – we do not have floor meters but we can create linear meters if we are clever.

After all we are looking for meters to sell profitable goods from. I firmly believe that if you do not have space you become ruthless about the lines you carry. And that is good news – no dead stock and stock rotation only improves! 

So what are the stock items you need to carry when space is limited? An ATM, air time, good bread products, good coffee, take out snacks – and then the invariable drinks to go with it all. Nothing more…. With no franchise fees it will be profitable but it has to be tasteful too…so be careful as to how you present your offering.

Fresh is the key word – and special – each coffee is a work of art, each bread is specially made for you – and so on.

With limited space you do not want customers hanging around – it will impact on your forecourt sales- so in and out for the best quick service in town!

In this particular example the site is located near the beach front – so those soft serve ice- creams are a must too…  winter and summer..

The answer – size does not count….but my bank balance does!

Take care out there

Jocelyn Daly

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Promotions

Hello to all of you once again!

After my last note I thought it would be appropriate to look and compare various current promotional activities out there in the industry. Put them up on a spreadsheet and look and test how each one of us are doing in terms of addressing our customers. Boy was I in for a surprise…

So here is a list of the stores I visited:

2 Engens with a Woolworths offering
2 Caltex sites – none with the new offering of a Fresh Stop
2 Bp’s – one with a P&P offering and one without
1 Shell Select
No Totals
No Sasols

And the outcome? I shake my head as I write this. Not one store besides the Shell Select which had a pamphlet – could tell me what was on special. On the Engen sites – a supervisor was called each time – and they could not tell me what was on special. In fact they said they had none running at the time.

On all the other sites – the cashiers conferred with one another to check if in fact there were any specials – only to tell me there were not any running!!. I ask you with tears in my eyes…..because most did in fact have specials on promotion!!

And I walked each store before I asked the question at the tills! So before I got there I found one or two items on special – and the cashiers did not know about them. Yes they were not well marked – nor was there any special attention given to them on the floor – but they existed none the less.

One store – the P&P Express – which also called a supervisor who pronounced that there were no specials running at the time – when I walked out of the store – I saw a notice at the entrance to the store that both white bread and fresh milk were on special. But both staff and supervisors did not know about it? And as a customer I did not notice it going in – even though I was specifically looking for specials??

So I failed in my personal objective this week – but perhaps I did not? If the staff do not know what is going on in the store – how will your customers know?? And therein lies the nub of the question.

Take care out there

Jocelyn Daly

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Welcome 2010!

For once I managed to get some time off over the festive season which was fantastic even if in Cape Town you get to feel like a stranger in your own home town! I got time to visit various retail outlets and of course to visit our many convenience stores. In fact I spent hours in our stores and in some cases was absolutely delighted, and in some cases was very saddened– isn’t it always a mixed bag out there!

2010 in my view is the year of supermarket chains making serous inroads into our industry! They have come in as traditional retailers and are going to give the rest of the market a good run for their money. This is not about a small corner of our shops being allocated to one brand such as the Woolworth’s concepts at Engen. Or giving a fast food brand another corner of our store! This is about a significant change in the way we market to our customers. And I love it!

Yes, I still dislike the store layouts immensely – they are really poor and over time I am hoping that these will be addressed. What I do love are the promotions – real ones, ones that our customers can relate to at last! And the range! Now that is what I call a convenience store – it has a bit of everything that most homes might need. Yes they do not have a huge range in each category for me to choose from, but we as customers expect that – otherwise we would pop into our supermarket instead! But I can find just about anything….no missing eggs, ice cream or cream. (Do you recall my visit to three convenience stores last year in one week? All three of these products were missing – in summer!)

And the fresh food range is large! Gone are these big displays of 10 different types of pies – and only pies! Thank goodness! In my view this is what has hampered the growth of even Woolworths at service stations. You still get the mediocre fresh food offerings being dished up – even though I can get my choice of meat for a braai and salads to go with it. Now these outlets will be trading on their brand name only without the range you can get other service stations.

 This is going to be exciting for us all to watch and makes 2010 not just another year – but a dynamic one, and at long last a breath of fresh air! That helps to clean the old cobwebs out and get serious about our own businesses. The costs are going to be enormous and not just in capital and monetary terms – but in people, and logistics. Let’s hope that our customers respond by opening their wallets generously!

I have purposely not mentioned the bad experiences I had – this is a new year after all – so let’s concentrate on the new and the bold! Let’s herald it as a new beginning for all of us!

 Take care out there

Jocelyn Daly

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Store Design and Layout

We have some exciting and different convenience store models being rolled out currently, which can only be good for the industry. Nothing like a good broom, some fresh air and some new ideas to grow the business!  I just hope they have long pockets as it is going to cost plenty to change their business footprint – whatever has been set aside to implement this is going to cost at least double going forward – I have done it before, so I know.

 Ok so let’s take a closer look at what we have on offer from a design point of view. We will look at the other areas, such as offerings, pricing and the rest later. We have Freshstop and Pick and Pay Express. What they both have in common is the same ridiculous layout. Imagine being a cashier in either store! Would any of you like to do this job yourself – honestly?

Just think about it.  You see the door opening but you have no idea whether there are one, two or more customers that have entered the store! You cannot even see the aisles from where you sit/stand! Nobody comes to the till for ages, yet you know that the door was opened a while ago…what do you do? Leave your till to find them, wait until they have taken what they need and left through the door again without paying (not applicable in P&P Express)?

As a customer how do I feel –just bloody awful. In the P&P Express, you walk in one door, amber through aisles where you cannot see the next aisle, and have to leave through a separate door. What happens if the guys are drunk and are intent on causing mischief? (Stoned if you live in Cape Town).     

 And now I am just being kind – what about gun toting individuals? Hell I would not let my kids into these stores, day or night. The poor cashiers cannot even see the forecourt for the most part, their backs are against the wall!

 Quite ridiculous and any savvy customer will not enter these stores. Who designs them? I know from my past life just how difficult it is to get extra linear meters out of these stores which were built in an era long gone past.  And any retailer will want each square inch to work for him so every linear meter counts, but not at the cost of safety.

Now just imagine, you walk into a store through one door marked “entrance only”. Then you meander through the store and come towards the till with the goods you wanted to purchase in your hands – and there in front of you is a hold up. You can’t go backwards because the door doesn’t open the other way. Talk about claustrophobia! It was instant for me – perhaps because I have been caught so many times before in our stores.

No there was no hold up while I was there – I just imagined what it would be like to be in the store when it happens (present tense implied here). The whole point of being well lit, visible – was to make the customer feel secure while shopping in our stores! Day and night!

I have one question to ask the guys that designed these stores. Would you let your children shop in these stores? The magazine racks in the Freshstop hide all view of everything in the store including your vision of your kids shopping in the store.  Just think about it….

Take care out there!

 Jocelyn Daly

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