convenience chilled

Sir: Concierge offerings (20 June, p26) may seem new to many c-store owners but your survey proves that, for a successful shop to survive, the tried and tested ’c’s remain: the efficacy of capturing and converting custom to cash.

The pressure is on the local corner shop to hold on to custom as the big supermarkets are back on the local high street using their pricing power to win back weekly shoppers who are going local with more frequent but smaller baskets. Discounting alone will be a suicidal race to the bottom traditional corner shops will never win, so the key is getting customers through the door, making them stick around and encouraging incidental spend. Margins can remain tight provided the cashflow is strong. Small wonder cash machines are such a hit while coffee machines necessarily make shoppers linger longer. The successful niche local chains have upped the quality of goods and service but must continue to diversify their offerings, from reinventing post office services to dry cleaning, to stay a step ahead.

The good news is that they are already on the high street and, unlike the big supermarkets, won’t be left with large out-of-town hypermarkets struggling to get custom back through the door to empty shop floors populated by dry cleaners to restaurants.

If petrol stations have reinvented themselves as local stores for shoppers on the road, traditional convenience stores can capture pedestrian footfall with the right extra offering, while focusing as ever on the ease of cash conversion. Profitability helps, but there has to be cashflow in the first place to make a margin.

No matter how much local shops plan for their strategies on pricing and quality, nothing beats a good location - which may even come down to which side of the local railway station they are on placed to grab the lion’s share of commuters.

From then on it is how well they make customers stick and convert footfall to cash.

Ben Woolrych, partner at FRP Advisory

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