WE GET RETAIL BECAUSE WE’RE RETAILERS TOO!
JANUARY 2019 | ISSUE 189
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FASTEST GROWING BRAND IN SCOTLAND
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Happy Hogmanay 2019
1 Nielsen Market Track Jan 2018 to October 2018 (based on slope calculation)
SLR Rewards 2019 officially launched! p23
FASTEST GROWING BRAND IN SCOTLAND
1
Happy Hogmanay 2019
1 Nielsen Market Track Jan 2018 to October 2018 (based on slope calculation)
WE GET RETAIL BECAUSE WE’RE RETAILERS TOO!
BLAKE GLADMAN
The secrets to vaping success
STEVE O’NEILL
JANUARY 2019 | ISSUE 189
WWW.SLRMAG.CO.UK
How to work your EPoS harder
DON’T COUNT ON IT
The draft Scottish Budget is the most business-friendly for a while – but will it get through Parliament?
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Join our first class team Meet one of our newest members, Mohammad & Michelle Razzaq Having decided that our existing symbol partner was no longer serving our needs as a business or the needs of our customers, we started the journey of looking for a new direction to take our business. We had productive meetings with various symbol groups but a chance conversation led to us contacting CJ Lang and Son Limited and the rest as they say is history. Initial meetings and a visit to the CJ Lang and Son Limited distribution centre in Dundee, made us feel that we were really valued, a feeling we had never had with any other group. From there it was all systems go. We negotiated our deal, CJ Lang and Son Limited designed a new store for us and we couldn’t be happier with the end results. From there a team moved in to restock and merchandise the store with new products, including a fresh range that is second to none. Our launch day was a great success with goody bags, a face painter and balloons as well as a leaflet distributed to support all the great deals in store. Feedback from customers has been fantastic and although we know our journey continues, we’re looking forward to the future knowing we’re in good hands as part of the CJ Lang family. It may sound like a cliché but for the first time ever, we feel like we’re part of a great symbol group, one that we would willingly recommend to anyone. Mohammad & Michelle Razzaq Owner - SPAR Blantyre
best, e h t n To joi winning award Scotland. ess in n busin now o
s Call u 12000 5 01382
CJ Lang & Son Ltd, Longtown Distribution Centre, 78 Longtown Road, Dundee, DD4 8JU
SparScotlandOfficial
@SparScotland
www.cjlang.co.uk www.sparscotland.co.uk
January 2019
Contents
Contents ISSUE 189
NEWS p6 Scottish Budget Retail industry backs a number of measures in Derek MacKay’s spending plans. p7 Wholesalers Colin Smith assumes full responsibility for the Scottish Wholesale Association. p8 Crime A 57-year-old woman is threatened with a gun as she starts her shift in Spar Tarbolton. p10 Crime Home Office Minister hosts top-level industry summit on legislating against violent and abusive customers. p11 Suppliers Müller completes £15m upgrade of Scotland’s largest fresh milk dairy in Bellshill. p12 News Extra The End Of Cash? A new report warns that becoming a cashless society could disadvantage millions of UK consumers. p18 Product News Ferrero unleashes a chocolate squirrel as it sets its sights on spring. p20 Off-Trade News Guinness to sponsor Six Nations rugby tournament, while Prosecho Falls pops-up.
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INSIDE BUSINESS p22 Research Digest A new study suggests retailers are falling behind by failing to equip their staff with the tech they need to offer excellent customer service. p23 SLR Rewards The convenience retail world’s most rewarding awards are back for 2019. p28 Getting More Out Of EPoS The second of our six-month series of ‘hands-on’ articles shows how, by leveraging your EPoS system, you can drive big wins from small changes. p30 Seattle Study Tour SLR journeys to Seattle to visit the original Amazon Go, among other places. p41 Hotlines Barr Soft Drinks puts a new twist on energy drinks, plus a host of other new products. p62 Under The Counter Christmas may have come and gone, but the curmudgeon-in-chief is still talking turkey. FEATURES p42 Vaping The vaping market offers massive growth potential at this time as consumers try to give up smoking. p47 Fascia Guide As the new year dawns, many retailers may be considering joining a – or switching their – symbol group.
ON THE COVER p16 Scottish Budget Derek Mackay’s draft proposals have received a warm welcome – but will his budget get through parliament?
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JANUARY 2019 | SLR
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News BUSINESS COSTS Finance Secretary unveils tax and spending plans
Amazon Go comes to UK? Amazon looks set to bring its checkout-free stores to Britain after registering a trademark for its Amazon Go format last month. It has also been widely reported that the internet giant is sourcing a number a retail sites for the stores. According to the Sunday Telegraph, Amazon plans to open its first British Amazon Go – and also the first outside of the US – somewhere near Oxford Circus in London. Sources claimed Amazon is looking for a retail space of between 3,500 and 5,000sq ft for what would be its flagship UK store. It has also been rumoured the company has plans to open 3,000 cashier-less stores worldwide by 2021. SLR Publishing Editor Antony Begley recently accompanied an SGF delegation on a study tour of Seattle that included a visit to the original Amazon Go. Read
Scottish Budget welcomed by retail and wholesale industries The Finance Secretary, Derek Mackay delivered his draft spending and tax plans in parliament on December 12, with several measures backed by retail and wholesale trade bodies. The business rate poundage will be capped at a below inflation level of 2.1%. The Finance Secretary said that the decisions on business rates also mean that more than 90% of properties in Scotland will be charged a lower tax rate than the rest of the UK. The Scottish Grocers Federation (SGF) welcomed the announcement. Head of Public Affairs Dr John Lee said: “Business rates are one of the main costs that retailers face and we welcome the Scottish government’s commitment to capping the rate rise. Retailers face significant pressure
Finance Secretary Derek Mackay from a range of costs in a hypercompetitive market and any measure which assists in keep costs down is beneficial.” The Scottish Wholesale Association (SWA) also welcomed the decision. Chief Executive Colin Smith said: “This will come as welcome relief to SWA members’ customers.” The proposed levy on out-of-town businesses will not be introduced at the moment, a move welcomed
by the SWA, although the Scottish Government will keep the matter under review. Both SGF and SWA welcomed the announcement that the Scottish government remains committed to the Small Business Bonus Scheme. Income tax rates remain the same as last year. This means 99% of tax payers will see no increase, however starter and lower rate thresholds will be increased by inflation to protect the lowest earners. The high rate threshold will be frozen. The Finance Secretary also announced a new £50m capital fund to support town centres to diversify and develop. “This will boost small businesses across the country,” said the SWA’s Smith. See this month’s cover story (p16) for a full analysis of the budget.
his opinion on page 28. CASH HANDLING Bank of England toasts its anti-counterfeiting strategy
Blackcurrants under threat from warmer winters Milder winters may reduce the amount and quality of UK-grown blackcurrants, researchers from Dundee have found. The James Hutton Institute boffins said milder winters may cause blackcurrants to flower later, producing less fruit. Blackcurrants need a spell of cold weather before they start to grow in spring. Apparently chilling cuts the danger of frost damage to new buds, ensuring they burst rapidly in the spring and flower together, when there are plenty of pollinators available. The researchers said understanding how different types of blackcurrant might respond to climate change was “critical” to farmers. Dr Katherine Preedy, from Biomathematics and Statistics Scotland, said: “We hope to identify genetic markers associated with the ability to withstand variable winters, so we can rapidly breed new varieties
Banknote Checking Scheme celebrates its first birthday The Bank of England has marked the first anniversary of it Banknote Checking Scheme by hosting a special event for retailers and businesses from around the UK. Sarah John, the Bank’s Chief Cashier, spoke at the evening reception and thanked supporters of the Scheme, including the One Stop symbol group. The event also celebrated the wider successes of the Bank’s anti-counterfeiting strategy. The Banknote Checking Scheme is aimed at cash-handling businesses to promote banknote checking and prevent financial and reputational losses associated with counterfeit notes. The Scheme has six guiding principles which promote banknote checking and training and the development of a good working relationship between businesses and the Bank. In the Scheme’s first year, the
Bank has received over 100 pledges of support from retailers and businesses covering around 7,000 stores across the United Kingdom. One Stop’s Joe Rutlidge said: “Pledging our support to the Bank of England’s Banknote Checking Scheme has helped us to: provide up-to-date and relevant training material for colleagues; align and
update our counterfeit banknote processes; and empower our colleagues to feel more confident in knowing what to do in the event they suspect they have received a counterfeit note.” The Scheme is a collaboration between the Bank of England and a number of strategic partners including the ACS and BRC.
of blackcurrants”. KEEP UP WITH THE LATEST NEWS AS IT HAPPENS – FOLLOW US ON TWITTER @SLRMAG
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SLR | JANUARY 2019 www.slrmag.co.uk
News WHOLESALERS New Chief Executive ‘ready to move trade association forward’
Smith steers SWA into 2019
England to get depositreturn scheme
Colin Smith has assumed full responsibility for Scottish Wholesale Association. He took over the reins at the trade body on December 31. Smith, who was appointed as Chief Executive (designate) in the summer, has been working closely with outgoing Executive Director Kate Salmon in order to ensure a smooth handover when she steps down from the role at the end of February after leading the SWA for 35 years. She will continue to work for the SWA on a consultancy basis. Speaking last month, Julie Dunn, SWA President, commented: “I am delighted to confirm that Colin will assume responsibility for the association – reporting to the Council – at the end of the year. “It has been important for Colin to benefit from Kate’s experience and vast knowledge of the Scottish wholesale sector. He is now ready to move our association forward as we support our members in times of change both within the trade and on the political landscape.” Smith, whose career in the wholesale sector spans more than 20 years, was Scottish Regional Manager for Best-one before launching Pinkie Farm Convenience Store in Musselburgh. He previously
has said that England will follow
The Department for Environment, Food and Rural Affairs (DEFRA) Scotland’s lead in implementing a deposit-return scheme (DRS) for single-use drinks containers, subject to consultation. The announcement came as part of a wide-ranging Resources and Waste Strategy. In the strategy, DEFRA said its preference was for a UK-wide approach to DRS and that it would continue to work closely with Holyrood on the matter. A unified scheme negates the need to have different SKUs for Scotland and England. These would be necessary to
SWA Chief Executive Colin Smith
prevent fraudulent redemption of containers on which no (or a
worked for Bellevue Cash & Carry in Edinburgh in various marketing roles and has also worked for Costco Wholesale. “Working alongside Kate over the last few months has helped me get to grips with the plethora of challenges facing our members and suppliers, and I have also been able to use this time to meet members and forge closer relationships with suppliers and other stakeholders,” he said. “What is also clear is that a collaborative approach is often the best way forward when debating the
key issues affecting the wholesale industry and the wider food, drink, retail and tourism sectors – and SWA is very much at the forefront of all of these important discussions. “Wholesale is a vibrant industry offering great career opportunities and it provides suppliers with an excellent opportunity to tap into the strong route to market that our members’ independent retail and foodservice customers offer – I am looking forward to helping our sector grow and evolve, and giving wholesale a stronger voice.”
lesser) deposit had been paid. The government plans to have the scheme in place by 2023 if it gets the green light. The ACS and NFRN both welcomed the announcement.
Energy drinks: ‘not enough evidence for a ban’ There is not enough scientific evidence to justify banning the sale of energy drinks to children, the government’s Science and Technology Committee has concluded. However, the committee’s
WHOLESALERS Martin Race bows out at awards bash
‘Energy drinks and children’
Bestway boss goes out with a gong
report said the government
Bestway Wholesale notched up two wins at the recent Federation of Wholesale Distributors FWD100 Gold Medal Awards. In a fitting tribute on the last night of his 40-year career in the wholesale industry, the company’s boss Martin Race was recognised with the ‘Special’ award and entered the stage to a standing ovation, where he gave a heartfelt speech. Recognised for its commitment to retailers and securing of 4,500 wholesale retail jobs in the acquisition of Bestway Vans Direct and Conviviality Retail (now Bestway Retail), Bestway also won the ‘Wholesale service to retail’ award.
drinks had more harmful effects
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Saying it was an honour to be recognised by the Federation, Race commented: “It’s fitting for Bestway to have won the wholesale service to retailers accolade in what has been a turbulent year for the sector. “Bestway has managed to strengthen its leadership in retail with acquisitions which have given us representation across company-owned, franchise, symbol group, retail club and unaffiliated retail.” Commemorating 100 Martin Race years since the FWD’s inception, the event celebrated outstanding people, products and services in the wholesale sector at Old Billingsgate, London.
should commission independent research to discover if energy than other caffeine-containing soft drinks. The committee also welcomed the current voluntary ban on sales to under-16’s imposed by responsible retailers. Professor Russell Viner, President of the Royal College of Paediatrics and Child Health was disappointed with the report’s conclusions. He argued that the government should introduce “a minimum price for energy drinks as we know their cheap price tag is a key driver for their purchase”.
JANUARY 2019 | SLR
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News CRIME Woman menaced as she opened store
Home Bargains refused Springburn alcohol licence Glasgow City Council has refused to grant an alcohol licence to a Home Bargains discount store located in the city’s Springburn area. The bid to sell beers, wines and spirits was rejected as alcohol-related harm in the area is 220% higher than the national average. At a meeting of the local licensing board a Home Bargains spokesperson disagreed that the move would encourage drinking. They said the discount chain’s store in Clydebank was selling alcohol without any problems. However Elaina Smith, of Glasgow city health and social care partnership said Springburn was already filled with stores and supermarkets selling booze. “To have another one would make the problem even bigger,” she said. After discussing the matter
Gun pointed at Ayrshire shop worker in horror attack A store assistant was threatened with a gun as she started a Sunday shift last month (December 2). The 57-year-old woman was at the rear of the Spar Tarbolton store to open a shutter at 6.45am when a man wearing a dark balaclava appeared behind her and produced the weapon. He demanded she open the door but fled when the alarm was raised. He is white, between 5ft 8in and 6ft, slim and spoke with a local accent. The man was wearing a navy bomber jacket, dark trousers and was a carrying a sports holdall. Detective Sergeant Craig Semple from Ayr CID said: “From witnesses spoken to so far we understand that the suspect had been sitting at the bus stop across from the Spar for some time prior to the incident.
“Extensive enquiries are ongoing and in particular I would like to speak to a man and a woman who walked past the suspect at around 6am and appeared to stop and look at him. “The man is described as in his early 20s, with dark hair swept to the side and wearing a tartan or checked shirt.
“The woman is described as having long dark hair and wearing a cream top. “The suspect was not wearing the balaclava when he was waiting at the bus stop and I would appeal to anyone who noticed him sitting there, or anything at all suspicious, to please get in touch.”
further the board rejected the application.
Scots jobless rate hits record low Unemployment in Scotland has fallen to a record low of 3.7%, according to official figures. This is below the UK figure, which is currently 4.1%. According to the Office for National Statistics (ONS, the number of people looking for work fell by 13,000 between August and October – an 11.2% decrease – with Scottish unemployment sitting at a total of 100,000. ONS data also showed that 75% of the working age population (aged between 16 and 64) were in some kind of work. The number of people in work fell by 1,000 over the period, with 2,633,000 people aged 16 and over in employment. Unemployment fell among both males and females, with the number of men out of work down by 8,000 over the period to 58,000, while the number of women without a job decreased
CHARITY Symbol group makes a difference
TOBACCO
Nisa colleagues support local causes with £80k
JTI launches retailer competition
Staff at Nisa’s Partner Support Centre in Scunthorpe have nominated good causes to receive almost £80,000 in donations through the company’s registered charity, Making a Difference Locally. Every year through its charity, Nisa allows head office colleagues the chance to support a cause they care about with a charitable donation. This year, 267 donations were made to 158 individual causes, ranging from schools, Scout groups and sports clubs to health and cancer charities, theatre groups and more. One local cause to benefit was Brigg Town Under 14s Girls Team (pictured), who were grateful to receive a donation of £300 to help with running costs. The club’s manager, John Coulson, said: “Thank you very much for your kind donation, it is greatly appreciated and will be a great help towards the running of the team. The money will go towards the
winter training pitches and extra kit for the players, now that we’ve gone to 11-a-side from 9-a-side.” Kate Carroll, Nisa’s Head of Charity, added: “2018 has been another incredible year for charitable giving amongst Nisa retailers and colleagues alike, and donations have been made to a wide variety of deserving causes. “We give colleagues the opportunity to support good causes they care about as it not only engages them with Nisa’s charity on a more personal level but also gets them involved with small local groups and charities. We’re delighted to be able to support so many different causes and have again received some fantastic feedback, both from them and our colleagues.” In addition to this, Nisa head office colleagues have raised almost £2,500 for local and national causes throughout the year via a number of fundraising activities.
JTI gave retailers the chance to get into the Christmas spirit last year with the launch of a new UK-wide competition to support its Logic Pro range. The ‘Looking for Logic’ competition features on the company’s trade website JTIAdvance.co.uk where retailers are invited to find images of the full Logic Pro range hidden within various Christmas scenes. The competition runs until January 20, with a new scene released every fortnight, so there’s still plenty to time to enter. Retailers have the chance to win prizes including a Robot Vacuum Cleaner, iPad, £200 holiday vouchers and an HD security camera.
5,000 to 42,000. KEEP UP WITH THE LATEST NEWS AS IT HAPPENS – FOLLOW US ON TWITTER @SLRMAG
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SLR | JANUARY 2019 www.slrmag.co.uk
Join our first class team Meet one of our newest members, Daryl Philp We initially decided to join the SPAR Brand due to the extensive support network and we’re really glad that we made the right choice. SPAR has given us so much time and support and were fantastic with the shopfitting and making all required adaptations needed to convert a former bank to a store. Our customers have also loved the SPAR Brand. With such an extensive range in the own brand label, including their ‘best in class’ chilled range, our customers love the quality and range of products we offer as well as big brands at reasonable prices. We’re so happy that we chose SPAR; we joined a brand but became part of a family. Daryl Philp Owner - SPAR Aberdour , e best h t n i To jo winning award Scotland. ess in busin ow on
sn Call u 12000 5 01382
CJ Lang & Son Ltd, Longtown Distribution Centre, 78 Longtown Road, Dundee, DD4 8JU
SparScotlandOfficial
@SparScotland
www.cjlang.co.uk www.sparscotland.co.uk
Signature is coming soon
CRIME Minister hosts retail industry representatives to solve problem of violent customers
Home Office ‘positive’ about shopworker protection Home Office Minister Victoria Atkins has Lillis said Atkins – the Minister responsible hosted representatives from the retail sector for Crime, Safeguarding and Vulnerability – for a top-level industry summit on how best asked to be given time to consider concerns to protect staff from violence, threats and raised at the meeting. abuse. “We reserve the right to return to the The Minister agreed to the talks during Offensive Weapons Bill if the Government the report stage of the Offensive Weapons doesn’t agree to a review of legislation,” he Bill, in response to an amendment tabled by added. David Hanson MP that would create a new “A specific offence of obstructing a retail offence if a person attempting worker who is enforcing to buy corrosive substance or the law, which is easily knives abuses, threatens or understood by employers, assaults the retail worker who staff, police, judiciary, is enforcing the law. shoppers and most of all Among attendees were violent criminals is absolutely Usdaw General Secretary necessary.” Victoria Atkins Paddy Lillis; NFRN National Mike Mitchelson said: President Mike Mitchelson; MPs David Hanson and Richard Graham; Chief Inspector Patrick Holdaway from the National Business Crime Centre; and representatives from other retail groups and trade organisations. Following what Paddy Lillis described as “a positive discussion” the Minister agreed to look at the possibility of holding a consultation into the types of measures that could be introduced to protect retail staff and will formally respond after Christmas.
“We were pleased to have the opportunity to share our members’ concerns about their safety with the Home Office Minister. Shop owners and their staff do feel vulnerable, particularly when they are confronted by angry customers when they are dealing with the sale of age restricted products. Everyone behind a counter needs to feel they have the law on their side and the protection of police and those are points that we stressed at today’s meeting.”
STORES FOR SALE Wholesaler prunes estate
CJ Lang puts eight companyowned Spar stores on market
NEW NAME
SAME CIGAR
Learn more at stgtrade.co.uk
Acting on behalf of CJ Lang, specialist business property adviser, Christie & Co has been appointed to market eight Spar branded stores situated across Scotland, including High St, Invergordon; Portland St, Troon; Holburn St, Aberdeen; 101 Central Ave, Gretna; Whitesands, Dumfries; Hilltown, Dundee; Whitletts, Ayr and High St, Carnoustie. Following a strategic review of its company-managed store division, the Dundee-based wholesaler decided to bring the eight stores to the market to enable further growth of its estate. The sale of the eight stores will bring its portfolio to a total of 108 sites, with plans to add three new greenfield sites across the central belt over next 12 months. Daniel Arrandale, Director at Christie & Co, commented: “The sites represent
an ideal opportunity for both experienced operators or first-time buyers to acquire an established convenience store business at a competitive price. “The stores offer the usual standard services and project lines, with six of the sites offering Post Office services and two also with an in-store Subway franchise. “With locations across the Scotland, we anticipate a range of interest from across the UK given the high-profile nature of this instruction. A number of the stores have already attracted significant interest and there are several indicative offers on the table.” Christie & Co is inviting offers for either the eight sites in sub groups or on an individual assets basis. For further information on the sites, visit www.cjlang.christie.com.
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SUPPLIERS Hurdler jumps at chance to visit dairy
Müller completes £15m dairy upgrade
Signature is coming soon
Müller Milk & Ingredients CEO Patrick Müller and Eilidh Doyle A £15m project to substantially upgrade Scotland’s largest fresh milk dairy in Bellshill and secure 265 jobs has had its completion marked by a visit from Scottish 400 metres hurdles record holder and multiple medallist, Eilidh Doyle. The project by Müller Milk & Ingredients, makers of the Official Milk and Milk Drinks of British Athletics, represents the largest single investment in Scottish dairy processing for more than a decade. It gives Müller’s Bellshill dairy the capacity to process more than 370 million litres of fresh milk and cream each year from the milk provided by 230 of Scotland’s dairy farmers.
The project includes a new filling hall to make cream products, two additional fresh milk production lines, energy efficient cooling systems and an extended chill space to increase capacity for finished products. Bellshill is the only Scottish dairy with the ability to manufacture milk bottles on site which are 100% light-weighted and recyclable. It also makes products using recyclable Tetra Pak cartons made with paperboard, a renewable raw material. Müller’s three-year programme to concentrate production in Bellshill involved the closure of two dairies in Aberdeen and East Kilbride.
CHARITY Christmas sing-song raises serious sum
GroceryAid’s Carol Concert brings festive cheer The annual GroceryAid Carol Concert has raised £60,000 for industry colleagues in need. The popular event was held at St Luke’s Church, Chelsea on December 12. It featured a professional choir and readings from a number of grocery industry bigwigs, including Weetabix boss Sally Abbott. She commented: “As ever, the GroceryAid Carol Concert was a beautiful event, such a peaceful, warmspirited and connected evening for an industry that can be so demanding. It’s great to know that our efforts are helping others in need, particularly at this special time of the year.”
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NEW NAME
SAME CIGAR Following the concert, a champagne and canapé reception was held at the nearby Chelsea Gardener. The sum raised is enough to fund 1,200 counselling sessions for those who have been the victim of a crime or a traumatic event.
Learn more at stgtrade.co.uk
FOR THE INFORMATION OF TOBACCO TRADERS ONLY
News Extra
Cash Handling
NewsExtra STUDYING STORES IN SEATTLE – P30 THE END OF CASH? Millions of consumers could be disadvantaged
Convenience Matters with the SGF There is no doubt that 2019 will be a challenging year for the convenience sector, as we will see a continued onslaught from the discounters. We have seen clear indication of this with Aldi opening 24 stores in the last two months, culminating in them opening eight stores alone on November 29, 2018. The cumulative cost pressures on our sector – with energy prices, rates, DRS, and wages – are also at the forefront of everyone’s mind. The future of the political landscape may be beyond our control, with the advent of the B-word, but we know that people are shopping more frequently and we must use our in-store data to drive sales, by looking at shopping habits, frequency, timings and tailoring our offering accordingly. Vaping, fresh foods, foodto-go, free-from products, protein, concessions, craft and premium spirits will create that extra margin and footfall. Vegetarian, vegan, organic and natural foods should all be considered, depending upon locality. Having a strategy and focus to drive sales and loyalty is essential. Shoppers understand that convenience can be a little more expensive, but that means just a little more. We will undoubtedly remain in a hyper-competitive grocery retail market throughout 2019. There are very positive things we can build on: turnover actually increased by 3% between 2017 and 2018, retailers in Scotland invested almost £80m in their businesses and the average shopper continued to visit their local store almost four times per week.
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REPORT HIGHLIGHTS DANGERS OF COMPLETELY CASHLESS SOCIETY A new ‘Access To Cash’ report funded by ATM network operator Link has warned that becoming a cashless society could disadvantage millions of UK consumers.
As the shift towards increasing use of digital and card payments continues, a new report funded by ATM network operator Link has warned that the UK is in danger of “sleepwalking” into becoming a cashless society that could potentially disadvantage millions of consumers. Debit cards finally overtook cash as the most popular payment method last year but the Access To Cash study, written by former financial ombudsman Natalie Ceeney, claims that notes and coins are vital for at least eight million people in the UK. The report highlights those in debt or living in rural areas as the most vulnerable groups in society. UK consumers’ use of cash has fallen by 50% in the last decade
with cash only changing hands in less than a third of transactions. Cash use is forecast to halve again over the next 10 years. “As cash use continues to fall, we need to safeguard the use of cash for those who need it, and at the same time work hard to ensure that everyone can participate in this digital economy,” said Ceeney in the report. The report specifically highlights a number of risks of going completely cashless: Q Rural challenges where poor or non-existent broadband would affect the ability to pay without cash. Q Difficulties for those with physical or mental health problems who might find it hard to use digital services.
Q Problems for those in debt who often find budgeting easier with cash. Q Risks for those in difficult or abusive relationships who use cash as a lifeline. Q Inflated prices for those unable to benefit from online services or direct debits. Ceeney concluded: “The decline in the use of cash has been dramatic, and with rapid technology development and adoption this trend will continue. But for millions of people in the UK, cash is not a choice, it’s a necessity. “If we don’t plan carefully for a world of lower cash, in other words, if we sleepwalk into a cashless society, millions of people will be left behind.”
SLR | JANUARY 2019 www.slrmag.co.uk
1
1
NEW
RRP
9
£
2
.35
You are free to sell JTI products at whatever price you choose. RRP effective from 29 October 2018.
1 MENTHOL STICK
2 SPEARMINT CAPSULE
3 3
You are free to sell JTI products at whatever price you choose, RRP effective from 29 October 2018. 3 Source: Nielsen Market Track, MAT Oct 2018. 2
PEPPERMINT CAPSULE
Comment
IT’S LIKE WALKING INTO THE INTERNET I had the privilege of visiting Seattle recently as part of an SGF National Executive study tour (see page 28) to visit the original ‘just walk out’ Amazon Go store. Having read so much about it, actually stepping inside was always going to be a bit of an anti-climax. And it was. For a start, it’s smaller than I expected at just 1,800sq ft. And while it’s quite pretty, I’ve been in a hundred better looking stores. But standing in the store it dawned on me that this is entirely missing the point. Walking into Amazon Go is like walking into the internet. The store is the closest thing you will find to a physical version of the worldwide web. The camera technology that powers the store effectively turns Amazon Go into the bricks and mortar equivalent of an online Amazon webpage. The fact the cameras enable faster, more convenient shopping is merely a happy by-product. The real point of the cameras is to ensure that everything that happens inside that store is turned into data which can then by analysed and turned into insight in exactly the same way Amazon manages its websites. Walk into Amazon Go and you’ve basically walked into Amazon’s website. As well as capturing every transaction and tagging it to an individual shopper, the cameras also capture all in-store ‘browsing’ activities. Things like picking products up but putting them down again. Spotting when consumers browse a fixture but then buy nothing from it. Identifying hot spots in the store. All these activities which can’t be tracked using EPoS provide Amazon with invaluable insight – and all in the same way Amazon tracks online behaviour. Whether you clicked on a button, how often you revisited the same page, how many times your cursor hung over a particular ‘buy’ button but didn’t click it. And it’s data that makes the threat of Amazon Go so daunting. Amazon’s online-only pedigree means that it views the world entirely differently from most of the retailers it will compete with in bricks and mortar. Online businesses are driven entirely by data and Amazon is truly customer-focused in a way that is incomprehensible to offline businesses. Amazon doesn’t want to specifically sell you books or clothes or soft drinks or TVs. It wants to sell you whatever it is that you want to buy when you want to buy it in the way you want to buy it. And it devotes much of its time to understanding what you want. This is fundamentally different from the way conventional retail operates, which is basically trying to sell you the range it stocks in the most profitable way. In Amazon Go, machine learning will drive ordering, ranging and merchandising at a single store level, constantly updating and improving every aspect of the store in real-time with almost perfect knowledge. The Amazon Go store will have access to your entire in-store transactional history. Not only that, it will have access to every transaction you’ve ever done with Amazon full stop. Data gives Amazon the power to make the lives of consumers better – and consumers love it. And it’s coming to a street near you soon. Amazon is already looking at around 200 sites in the UK. The really big question is: how does the local retailing industry prepare for this brave new world? The answer to that question is not a simple one.
EDITORIAL Publishing Director & Editor Antony Begley 0141 222 5380 | abegley@55north.com Web Editor Findlay Stein 0141 222 5389 | fstein@55north.com Editorial Contributor Karen Peattie
ADVERTISING Advertising Manager Robert Aitken 0141 222 5302 | raitken@55north.com
DESIGN Design & Digital Manager Richard Chaudhry 0141 222 5388 | rchaudhry@55north.com
EVENTS Events & Operations Manager Cara Begley 0141 222 5381 | cbegley@55north.com
CIRCULATION & SUBSCRIPTIONS Scottish Local Retailer is distributed free to qualifying readers. For a registration card, call 0141 222 5381. Other readers JUNE obtain copies by annual subscription at £50 (UK), £62 (Europe airmail), £99 (Worldwide airmail). 55 North Ltd, Waterloo Chambers, 19 Waterloo Street, Glasgow, G2 6AY Tel: 0141 22 22 100 Fax: 0141 22 22 177 Website: www.55north.com Twitter: www.twitter.com/slrmag DISCLAIMER The publisher cannot accept responsibility for any unsolicited material lost or damaged in the post. All text and layout is the copyright of 55 North Ltd. Nothing in this magazine may be reproduced in whole or part without the written permission of the publisher. All copyrights are recognised and used specifically for the purpose of criticism and review. Although the magazine has endevoured to ensure all information is correct at time of print, prices and availability JUNE change. This magazine is fully independent and not affiliated in any way with the companies mentioned herein. Scottish Local Retailer is produced monthly by 55 North Ltd.
© 55 North Ltd. 2019 ISSN 1740-2409.
ANTONY BEGLEY, PUBLISHING DIRECTOR
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Cover Story
Scottish Draft Budget
The Scottish Draft Budget proposals laid out by Finance Secretary Derek MacKay has so far received a warmer welcome than the Budget presented recently by his Westminster counterpart The Rt Hon Philip Hammond - but will it get through parliament? BY ANTONY BEGLEY
A
gainst the backdrop of the political and economic quagmire that is Brexit, Scottish Finance Secretary Derek Mackay has laid out his plans for how tax and spending will be managed for the coming year at Holyrood. At first glance, his proposals seem to offer a fair bit more to Scotland’s local retailing community than the Budget outlined not so long ago by his English counter-part, Chancellor of the Exchequer The Rt Hon Philip Hammond MP. Indeed, Mackay’s Budget has received relatively positive positive feedback from the retailing and wholesaling sectors. The Scottish Grocers’ Federation (SGF) was quick to applaud Mackay’s commitment to capping business rate rises and his intention to maintain the Small Business Bonus Scheme while the Scottish Wholesale Association’s (SWA) new Chief Executive Colin Smith welcomed “the decision to scrap the proposed new business rates levy and the decision to cap the increase on business rates at the below inflation rate of 2.1%”.
WHAT DOES IT MEAN FOR RETAILERS? But what exactly would Mackay’s Scottish Draft Budget mean for local retailers and, just as important, will he be able to get it through parliament in one piece? Mackay would argue that the proposals were once again aimed at helping the less privileged in Scotland with the new five-band income tax regime that came into force earlier this year being maintained at the current rates. In the Budget document, however, he proposes increasing the starter and basic rate thresholds by inflation in a move designed to help the lowest paid. At the other end of the pay spectrum, the higher rate income tax threshold has been frozen at £43,430 which sets Scotland apart from the rest of the UK where the threshold will go up to £50,000 from April. Scots higher earners will continue to pay a rate of 41% on earnings between £43,430 and £150,000 while those earning more than £150,000 will pay 46%. When it comes to business support, Mackay said the Scottish government’s Small Business Bonus Scheme is to be maintained, while the non-domestic poundage rates paid by businesses will see a” below-inflation increase”. A new £5bn capital investment commitment was unveiled to help accelerate the modernisation of Scotland’s infrastructure and a new £50m fund would be set up to help regenerate run down high streets. Initial funding of £130m towards the establishment of a Scottish National Investment Bank has also been earmarked. The Scottish government has also committed more cash to the £2.9bn justice budget and claims that this means the police resource budget will be protected in real terms, something that may be welcomed by retailers who face crime and abuse on a daily basis. SGF Head of Public Affairs John Lee commented: “We welcome the 16
SLR | JANUARY 2019
DON’T COUNT ON IT
Scottish Draft Budget
Cover Story
announcement in the Scottish Budget that the increase in the business rate poundage will be capped at a below inflation level of 2.1%. Finance Secretary Derek Mackay said that the decisions on business rates also mean that more than 90% of properties in Scotland will be charged a lower tax rate than the rest of the UK. “Business rates are one of the main costs that retailers face and we welcome the Scottish government’s commitment to capping the rate rise. Retailers face significant pressure from a range of costs in a hypercompetitive market and any measure which assists in keep costs down is beneficial. SGF also welcomes the announcement that the Scottish government will maintain the Small Business Bonus Scheme.” Meanwhile, the SWA also broadly welcomed a number of announcements in Mackay’s Draft Budget. SWA Chief Executive Colin Smith applauded the “decision to rule out an out-of-town levy for businesses at the moment although Finance Secretary Derek Mackay said it would be kept under review”. He commented: “SWA welcomes the decision to scrap the proposed new business rates levy and the decision to cap the increase on business rates at the below inflation rate of 2.1%. This will come as welcome relief to SWA members’ customers. We also welcome the announcement that the Scottish Government will maintain the Small Business Bonus Scheme.” Smith also praised the new £50m capital fund to support town centres to diversify and develop, a move that would “boost small businesses across the country”.
WILL IT GET THROUGH PARLIAMENT? It is worth bearing in mind that this is a Draft Budget and still requires to be voted through the Scottish Parliament with that final vote likely to take place in February. The SNP is currently a minority administration so it will require support from other parties to get the Budget signed off and in the current economic and political climate, that task could prove to be more than a little tricky. For the last couple of years the SNP has been able to rely on the support of the Scottish Greens but continued support from them looks increasingly unlikely as the Greens are suggesting that they won’t even enter negotiations until they see movement towards the major reform of local government funding that they are seeking. Indeed, they could see this as a prime opportunity to drive their own agenda forward as they appear to hold the key to getting the Draft Budget through parliament and may choose to leverage that power for their own ends. The Lib Dems are refusing to play ball until the SNP distances itself from a new independence referendum while the support of Labour and the Conservatives is extremely unlikely at the moment. This may present the Greens with a golden opportunity to make progress on its vision of replacing the council tax in return for its support. There is much to be resolved between now and the final vote and retailers can only hope that the positive measures proposed in the Draft Budget make it through the horse-trading intact. SCOTTISH BUDGET: KEY POINTS Q Out-of-Town levy – This proposed levy will not be introduced but the Scottish Government will keep this under review. Q Town Centres – In order to support town centres there will be a £50m capital fund to support them to diversify Q Income tax rates – They will remain the same as last year and so this will see 99% of tax payers seeing no increase however starter and lower rate threshold will be increased by inflation to protect lowest earners. The high rate threshold will be frozen. Q Business rates – they will not go up as much as inflation but rather by 2.1% Q Small Business Bonus Scheme – the Scottish Government remain committed to the scheme.
JANUARY 2019 | SLR
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News
Products
Frozen Food Fed launches digital campaign The British Frozen Food
ProductNews
Federation (BFFF) has launched ‘Fresh from the Freezer’, a new promotional campaign to further boost the burgeoning £8.6bn frozen food category. The digital-only push consists of a series of six short films highlighting meals that can be made with ingredients that are, as one may expect, “fresh from the freezer”. The six-month campaign aims to reach over three million consumers and target new chefs in a modern and energising way. The films will be promoted via a range of social media channels. The first film features a premium roast dinner made entirely from frozen ingredients. Other films include a Thai green prawn curry, breakfast pastries, fruit smoothies, gourmet steak and lobster, plus show-stopping desserts, and will be launched in the New Year.
TIME TO SWITCH YOUR SYMBOL? – P46 MEDICATED CONFECTIONERY Mondelez brand looks to cash in on cold and flu season
Halls coughs up for major national ad campaign Medicated confectionery brand Halls has launched a new out-ofhome advertising campaign for the cough and cold season. Live until January 17, the campaign educates consumers on the clearing and soothing benefits of Halls’ two sub-ranges, as well as reminding consumers that Halls is there for them when they start feeling poorly. The activity aims to drive sales during the peak of the cold and flu season by targeting high footfall locations near stores for six weeks.
The campaign features Halls’ best seller Soothers Blackcurrant alongside Halls Extra Strong. The ad features on static and digital sites, showcasing the functional benefits of the products. Digital sites also include regional specific cough and cold stats, with a tailored message to directly target regional consumers. Amy Lucas, Brand Manager for Halls, said: “We’re confident that our out-of-home campaign will help to drive sales, so we recommend that retailers stock up to take advantage.”
EGGS
British Lion eggs set to make big splash British Lion eggs has dived into a partnership with double World Champion Tom Daley as part of a £1m+ marketing campaign for 2019 to drive the continued growth of egg sales and increase awareness of the Lion. The #WonderEgg campaign has been designed to increase the visibility of the Lion, communicate the FSA advice that runny eggs are safe for vulnerable groups, as long as they are Lion, and tap into the nutrition, health and versatility benefits of eggs. Diver Daley, who has a whopping social media following of seven million, is spearheading the activity. Further ambassadors, partnerships and experts will be announced throughout the year. The campaign will also maximise seasonal and calendar opportunities yearround across traditional and digital media.
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SLR |JANUARY 2019 www.slrmag.co.uk
Products
News
CONFECTIONERY Ferrero backs Easter products with multi-million pound marketing budget
Ferrero springs into 2019
Ferrero has unveiled an array of NPD for spring 2019, including luxury chocolate eggs, mini eggs and a chocolate squirrel. The confectionery manufacturer is also investing £3.7m across TV, video-on-demand, social, sampling and in-store media to publicise its Thorntons, Ferrero Rocher and Kinder brands throughout the season. This Easter, the Thorntons range will be bolstered by the introduction of three new luxury eggs, with a premium look and feel aimed at younger, affluent shoppers. The premium eggs will be available in White Chocolate & Raspberry, Milk Chocolate Almond & Hazelnut and Dark Chocolate & Orange variants. For Kinder, two new 220g Surprise eggs will launch to follow on from the success of the 100g in 2018 – where value
sales grew by 21% and it was the top-performing SKU in the Kids’ Confectionery category. The eggs will contain larger than usual toys from Teenage Mutant Ninja Turtles and Powerpuff Girls. To drive early season self-treating sales, the Kinder range is being refreshed with a host of new products and line extensions. The five-strong range of Kinder Surprise 36g hollow figures will sport seasonally relevant characters and designs. For shoppers seeking more luxury, and to capitalise on the growing popularity of mini eggs, Ferrero Rocher is launching Hazelnut and Cocoa mini eggs. Both variants will be available in 100g packs. The launch will be supported by sampling activity to drive awareness.
COFFEE
Bolstering the range of novelties further is the introduction of the new Ferrero Rocher Squirrel. The 90g product scored highly for likeability in development, with 63% of shoppers saying they would purchase as an additional item. Completing Ferrero’s range of new products for Easter are new bunny figures from Thorntons. Two new 200g bunny products (one milk chocolate and one white) will launch this spring. Levi Boorer, Customer Development Director at Ferrero, said: “We’re committed to investing in media campaigns alongside our significant NPD to help retailers capitalise on the peaks in consumer demand.”
CONFECTIONERY
eXpresso PLUS gets makeover
GoodnessKnows is miserable now
Coffee-to-go company eXpresso PLUS has rebranded to give the coffee solutions it offers a brand-new look. Lauren Tyler, eXpresso PLUS Marketing Manager, explained: “On reflection of the achievements of eXpresso PLUS over the past five years, it is now the perfect time to give our business a new and distinctive look with a stronger identity. It was important that our new brand image portrayed the quality of the products we sell and the reputation we have gained as proven leaders in the market.” Working in partnership with Lavazza, Nescafé and PG tips, eXpresso PLUS has grown 390% in four years in a market worth £9.6bn, providing a range of ‘off-theshelf’ hot drinks machines and tailored design solutions to meet client needs. Tyler continued: “Investing in this rebrand shows eXpresso PLUS’s agility to move with market trends and underpins our commitment to the industry, while assisting in positioning us as a major player in the market.”
It was aimed at health-conscious consumers, but Mars Wrigley Confectionery is giving its GoodnessKnows brand the chop due to some unhealthy sales figures. GoodnessKnows was trumpeted as the company’s biggest launch in 20 years when it rolled out last August, with a £4.5 marketing campaign at its back. The withdrawal is bad news for community projects; the brand planned to divert 10% of profits into a fund that supported local initiatives. A spokesperson for Mars Wrigley said: “Sales of Goodnessknows have underperformed against our expectations since launch, so we took the difficult decision to discontinue the brand in the UK market.”
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JANUARY 2019 | SLR
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News
Off-Trade
Quinn gets in at IWA John Quinn, Global Brand Ambassador for the William
Off-TradeNews
Grant & Sons Irish whiskey brand Tullamore D.E.W. has been elected as the Vice Chair of the Irish Whiskey Association (effective 1 January 2019). Quinn joined Tullamore D.E.W. in 1974 and has worked with the brand ever since. He commented: “I’m delighted to represent William Grant & Sons and Tullamore D.E.W. in this role, but also to work hard on behalf of the Irish Whiskey category.” The Irish Whiskey Association provides a forum for all operators, new and old, to come together to share expertise and cooperate in building the Irish whiskey category brand.
Cutting drink drive limit has made ‘no impact’ on crash numbers The lowering of the legal blood alcohol limit for Scotland’s drivers has had no impact on the number of road traffic accidents, a new study has found. The research, led by the University of Glasgow, evaluated the impact of the change in legislation which occurred in December 2014 and suggests that lowering the legal blood alcohol concentration limit on its own does not improve road traffic accident outcomes. The study also found the lower limit did not affect off-trade sales.
Merchant City rolls out three new barrels Glasgow’s Merchant City Brewing Company has launched three new cask aged beers, two of which have been aged using Glenfarclas whisky barrels. Glenfarclas cask aged Jaggery Imperial Stout and Glenfarclas cask aged IPA are joined by a bourbon barrel aged Chocolate Stout with Sour Cherry. All three are available in 330ml and 500ml bottles, with RSPs starting from £5. The brewery has also launched two new pilot series
JANUARY IS A KEY MONTH FOR THE VAPING CATEGORY – P42 BEER & CIDER Heineken releases initial results of three-year category strategy
Premium beers driving growth, says Heineken Heineken has announced the first results of its Greenpaper three-year category strategy, suggesting that the insights it offered have been “instrumental” in driving more than half of the £670m opportunity that the beer producer initially identified. Unveiled in March, Heineken’s Greenpaper offered retailers solutions on how to grow their businesses and accelerate growth in the beer and cider category.
Built from over 100 pieces of qualitative and quantitative research, the category strategy identified an incremental £670m in value for the off-trade over the next three years (2018 – 2021) via six different drivers. Less than a year in, Heineken has identified an incremental growth of £355m across the category and says its ‘We’re Worth It’ driver is responsible for £148m alone. It also claims its ‘Sports
and Seasons’ driver has resulted in a growth of £125m, with the other four drivers contributing to the £355m total. Toby Lancaster, Category and Shopper Marketing Director at Heineken UK, commented: “We very much look forward to building on this momentum across the beer and cider category into 2019, so we can continue our commitment to helping our customers grow their business.”
SPARKLING WINE
ProsEcho Falls pops up at Waterloo Echo Falls popped up last month with a sparkling waterfall to promote ProsEcho Falls, its first foray into the prosecco market. The Accolade Wines brand wrung the last drop of publicity from its Love Island partnership by having Laura Anderson, a finalist from the reality show, hand out samples of the fizz to homeward-bound commuters at London’s Waterloo Station. Speaking in mid-December, David White, Echo Falls Marketing Director, said: “Twenty-seven per cent of Echo Falls’ shoppers drink the brand for a special celebration so it was the perfect time to engage thousands of Waterloo commuters in the run up to Christmas. “Having Laura there was a great way of bringing the memory of our successful Love Island partnership to a cold winter’s day.”
beers: Kristall Weizen and Chocolate Stout. KEEP UP WITH THE LATEST NEWS AS IT HAPPENS – FOLLOW US ON TWITTER @SLRMAG
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SLR | JANUARY 2019 www.slrmag.co.uk
Off-Trade
News
Vodka first for Skye A Portree-based distillery has launched the first vodka to be produced on the Isle of Skye. Misty Isle Vodka is the newest member of the premium spirit
BEER Diageo brand announces major sport sponsorship deal
Guinness sponsors Six Nations championship Guinness is to become the new title sponsor of the Six Nations, with the championship to be known as the Guinness Six Nations from 2019. The new sponsorship is a six-year deal and strengthens Guinness’ commitment to rugby, adding to a portfolio that includes the Guinness PRO14, and partnerships with the four Home Unions and clubs Leinster and Munster. The Diageo brand said it would use its sponsorship to encourage the millions of adult fans watching or attending the games to drink responsibly. Mark Sandys, from Diageo said: “This announcement affirms our
family from Isle of Skye Distillers, and the first vodka to be distilled on the island. Triple-distilled in small batches at 40% ABV, Misty Isle Vodka is produced with water drawn from the Storr Lochs, just three miles from the distillery. The fourth bottling by Isle of Skye Distillers, Misty Isle Vodka follows the release of three small-batch gins: Misty Isle Gin, Tommy’s Gin and Misty Isle Mulled Christmas Gin. Misty Isle Vodka has an RSP of £30 for a 70cl bottle.
Whisky makers get behind responsible drinking Thirteen projects set up to tackle alcohol misuse in Scotland have been granted awards totalling £175,000 by the Scotch Whisky
long-standing support for the game of rugby and cements our position as one of the world’s biggest rugby supporters. We truly believe in the power of sport
to connect communities and we’ll be working with the Six Nations to ensure that fans’ experience of the Guinness Six Nations is their best yet.”
Action Fund. The fund supports the Scotch Whisky industry’s commitment to tackling alcohol misuse and promoting responsible drinking. More than 50 awards have been granted over the past five years.
BEER Argentina’s favourite lager gets a packaging makeover
Morgenrot unveils Quilmes overhaul Morgenrot’s Argentine beer brand Quilmes has undergone a full brand revamp including a new packaging makeover of its bottles and cans. Renamed Quilmes Clasica, the brand first launched in the UK over a decade ago. Morgenrot’s Commercial Director John Critchley said Quilmes was “by far Argentina’s biggest beer brand and has now also developed a loyal following in the UK”. He added: “With the growing demand for beautifully packaged, taste-rich world lagers, we’re thrilled to launch the stunning new branding, which will be key as we look to make the brand a leading light in the super premium lager category.” Quilmes Clasica (ABV 4.9%) is available from Manchesterbased Morgenrot in 24 x 34cl bottles, 6 x 97cl bottles and 24 x 35.5cl cans.
BEER
Karen Betts, SWA Chief
Euroboozer strengthens low alcohol beer range
Executive, said: “This year
With Dry January upon us, specialist beer importer Euroboozer has augmented its offering with the addition of four 0.3% ABV craft beers from Mikkeller. The new quartet of “unique, sensory-rich beers”, which joins Stiegl Freibier (less than 0.5%) and Stiegl Grapefruit Radler (2%) in the Euroboozer low alcohol portfolio, includes lager Mikkeller Racing Beer, wheat beer Mikkeller Drink’in in the Sun, spiced winter ale Mikkeller Drink’in the Snow and Mikkeller Henry & His Science. The latter is described as a “primitive Flemish ale”.
people and other at risk groups
the awards reflect a greater emphasis on educating young about the risks of alcohol misuse.”
Get on board for Nusa Caña One to watch this year could be Nusa Caña, a white rum from Indonesia that is starting to make waves in the UK surfing community thanks to its association with the laid-back Balinese lifestyle. The rum is distilled twice in steel ‘Chinese’ pot stills before being aged in teak casks to give it an overall drier finish. Nusa Caña (37.5% ABV – 70cl) is distributed in the UK though sales, marketing and distribution agency Craftwork, which is looking to gain further trade listings throughout 2019.
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JANUARY 2019 | SLR
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Inside Business
•SHOP•
Research Digest
HALF 62% OF SHOPPERS 34% ‘BETTER 58% CONNECTED THAN79%STAFF SERVING THEM’ DELIVERY FULFILLMENT EXPECTATIONS GAP
IN-STORE TECHNOLOGY GAP
51%
Shoppers prefer to order out-of-stock items in store for home delivery.
Shoppers feel they are better connected than in-store associates.
Retailers offer to deliver an out-of-stock item for home delivery.
PERSONAL DATA SECURITY SATISFACTION GAP
Shoppers are satisfied with the security of their personal data information.
Retailer decision makers believe shoppers are satisfied with the security of their personal data information.
56%
Associates agree shoppers are better connected.
83% of decision makers and 74%
of associates say tech-equipped sales associates would improve customer service.
As technology plays an ever more central role to the lives of shoppers a new study suggests retailers are RETURNS OR EXCHANGES GAP falling behind by failing to equip their staff with the tech they need to 53% service. Store offerInsatisfaction excellent customer
T
55%
Onlineechnology satisfaction
is playing an increasingly staff cited frustration at their inability to assist fundamental role in the lives of the customers, with 42% finding they have little 74% 74% Decision vast majorityShoppers of consumers which time to help shoppers because of pressure Associates Makers is massively impacting on how to get other tasks completed. Another 28% 77% % they engage with retail outlets, yet claimed that 81it’s difficult to get hold of more than half of all shoppers (51%) feel that important information to help shoppers. retailers are missing a trick when it comes to The survey was conducted across a range of Sources: 2019 Zebra Shopper Study customer service because they feel they are retail environments but the learnings will be For more information visitin-store www.zebra.com/retail “better connected than staff”. That of interest to convenience retailers in today’s was one from a reserved. new global study of headever moreofconnected world where improving ©2019 ZIH Corp finding and/or its affiliates. All rights Zebra and the stylized Zebra are trademarks ZIH Corp, registered in many jurisdictions worldwide. All other trademarks are the property of their respective owners. 4,725 shoppers, 1,225 retail staff and 430 the shopping experience is a high priority. decision makers by e-ecommerce firm Zebra. The study also identified diverging Indeed, an even higher percentage of store expectations on the impact of automation staff (56%) agreed that customers are better between retailers and store staff. Nearly connected than they are while 83% of decision 80% of retail decision makers – compared makers and 74% of staff said a tech-equipped to 49% of staff – agree manned checkout team would improve customer service. areas are becoming less necessary due to new The survey also revealed more familiar technologies. Additionally, more than half complaints from retail staff with 55% saying (52%) of retail decision makers are converting that their company is understaffed, and point-of-sale space to self-checkout, with 62% nearly half (49%) feeling overworked. Store transforming it for online order pickup.
EXPECTATIONS FADED AS CHRISTMAS APPROACHED
T
he latest published SRC-KPMG Scottish Retail Sales Monitor, for November 2018, appeared to indicate that expectations of a strong festive period were fading as Christmas and New Year approached. Total sales in Scotland in November decreased by 1.6% compared with November 2017, the deepest decline since February 2017, excluding Easter distortions and below both the three-month and 12-month averages of -0.2% and 0.5% respectively. Adjusted for inflation measured at 0.1%, November sales decreased 1.7%. Total food sales in November did increase by 2.8% versus November 2017, when they had increased by 4.2%. This, however, is also below both the three-month average of 3.0% and the 12-month average of 3.9%, the lowest
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12-month average since December 2017. David Lonsdale, Director of the Scottish Retail Consortium, said: “Retail sales in November recorded their poorest performance for 21 months, with pretty dire results for items deemed less essential dragging overall retail sales into negative territory. Grocery sales grew but at a less pronounced pace than witnessed during the summer and early autumn. The gulf between food and non-food categories became starker, with the latter sinking markedly – to a twentyyear low - despite Black Friday discounting and the proximity to Christmas. “Food fared reasonably well but retailers now face a nerve-wracking few weeks leading up to the crucial festive season, after what has been a bruising year for many.”
OVER SIX IN 10 RETAIL WORKERS ‘FEEL LONELY’ Over six in 10 people (63%) working in the retail and wholesale sectors feel always, often or sometimes lonely. That’s the stark finding of new research released by the British Red Cross. The Red Cross polled over 4,000 UK adults and found that a third (33%) of people working in retail and wholesale don’t have colleagues they feel close to or can talk to about their loneliness. The findings of the research suggest a lack of meaningful social connections could be contributing to people’s feelings of loneliness and isolation as in the retail and wholesale sector: Q Almost half (47%) of people say they often feel alone, like they have no one to turn to Q Half (50%) of those who do have people they feel close to or can rely on say those people live far away from them Q Over a fifth of people (21%) don’t have friends they feel close to or can talk to The survey also found that of those in the sector who felt lonely: Q Over six in ten (62%) said their loneliness is having a negative impact on their life, and 64% worry their loneliness will get worse Q Almost two thirds (65%) often feel completely alone when surrounded by people Q Over a third (35%) of people said they have no strategies for coping with their loneliness Zoë Abrams, Executive Director of Communications and Advocacy at British Red Cross commented: “Loneliness and social isolation doesn’t discriminate. Life circumstances can change in the blink of an eye, meaning it can happen to anyone, no matter your age or background. “We all need someone to turn to in a crisis, but the findings of our research suggest that there are many people in our communities feeling they lack meaningful, human connections. This will be concerning for all of us to hear, no matter where we live in the UK, or with whom. “Every one of us would want someone to reach out to us if we found ourselves all alone. People who need our help may be closer than we think, and could feel much more connected if we offer them our kindness.”
SLR | JANUARY 2019 www.slrmag.co.uk
THE MOST REWARDING EVENT IN RETAIL RETURNS! Entries for the SLR Rewards 2019 are now open so it’s time to start preparing your entries for the only awards programme in the industry to offer every winner fantastic Rewards! SLR is once again delighted to announce that the most Rewarding awards programme in the UK local retailing industry is back! The search for the winners of the SLR Rewards 2019 officially starts here. First launched back in 2003, the SLR Rewards have grown and evolved over time with last year’s event the biggest we’ve ever hosted – but one thing has remained consistent: the awards have always been committed to recognising and rewarding excellence in Scottish local retailing. The event will once again be unique in offering valuable, often money-can’t-buy Rewards for every category winner. Last year’s Rewards included everything from trips to Las Vegas and Amsterdam to exhilarating flights in a microlight and highspeed Ferrari track days. This year’s awards look set to be just as Rewarding with yet more amazing prizes up for grabs, including a trip to the massive NACS Conference in Atlanta for the Scottish Local Retailer of the Year. So could it be you this year? The only way to win it is to be in it! So set aside some time and make sure you give yourself the chance of being among the winners on the 19th of June.
General Information The SLR Rewards 2019 are open to all independent and symbol convenience stores in Scotland. The content of your entry should cover the 12-month period running up to March 2019 and your store, or the project you are submitting in your entry, should have been operational throughout that period. HOW TO ENTER
Step 1: Visit www.slrawards.com. Step 2: Click on ‘Enter now’ to view the list of categories. Step 3: Click on each category name to access the entry forms. Step 4: Fill in your details and submit – along with supporting photos and/or videos. You will then receive a confirmation message and email. Microsoft Word versions of the forms are also available by emailing events@55north.com stating what categories you wish to enter.
TOP TIP!
Please make sure you answer all relevant questions on the entry form as fully as possible. Judges like supporting facts and figures!
MAKE YOUR ENTRY COUNT! To help make sure that your entry has the best possible chance of being shortlisted by the judges, here are a few top tips and helpful hints.
STICK TO THE FACTS
Q Be concise and provide as many reliable facts and figures as you can. Epos data is a great source of information and can add real weight to your argument. Q Don’t skip any questions! Blank spaces in an entry form don’t help the judges and can even hinder your entry.
MAKE IT VISUAL Q A photo is indeed worth a thousand words – so include as many photos as required to illustrate the quality of your entry. Q Feel free to include other visual documentation that might help strengthen your case: letters of commendation, certificates, other awards, newspaper clippings – it’s all good.
ADD VIDEO
IMPORTANT DATES ENTRY DEADLINE 15 MARCH 2019 SHORTLIST ANNOUNCED EARLY APRIL 2019 THE AWARDS 19 JUNE 2019 As always, if you have any other questions, please contact the SLR Events team: Cara Begley, Events & Operations Manager, 0141 222 5381, events@55north.com
Q Even better, why not add a short video to enhance your entry and really bring it to life for the judges?
MAKE IT EASY FOR THE JUDGES TO CHOOSE YOU Q We receive hundreds of entries every year and the judges have to analyse each of them to pull together a shortlist, so don’t give them any excuses to discard your entry at the first stage. Q The judges are instructed to ONLY judge what’s in front of them on the entry forms.
Q Q Q Q
They are not allowed to be influenced by information they may already know about your store but which isn’t on the entry form. Make sure you are answering the key questions: What you have done How you did it What the results were
THINK OUTSTANDING Q The judges are always on the lookout for innovation, creativity, thought and passion. When compiling your entry, make sure you go above and beyond simply best practice or basic good standards. Q Don’t be afraid to blow your own trumpet, or sing the praises of you and your team. That’s what the Rewards are all about!
SPECIAL CATEGORIES Q In the special category awards, the judges are seeking those who go that extra mile to deliver something exceptional. Most retailers are doing exceptional things but often fail to mention it in awards entries. Put some detailed thought into your entry to make sure you have a chance of being a winner. Q Be creative! If you’ve got something to say that doesn’t fit neatly into the entry form, feel free to present it however you like: PowerPoint, video, folders of information; it’s all acceptable and can help ensure you have a great chance of being among the winners on the night! Q Good luck!
JUDGING There are two stages to the judging process: PAPER JUDGING Q The paper judging will be carried out by a judging panel made up of the SLR editorial team plus a team of independent judges. They will vote for the shortlist for each category with every member of the panel carrying equal voting rights. Q All entrants will be contacted by the events team to notify them if they have been selected or not. STORE VISITS Q All shortlisted stores will be visited by a member of the judging panel. Q All winners will be announced at the Awards on 19 June 2019.
SUPPORTING PHOTOGRAPHS & VIDEOS
We cannot stress enough how essential supporting photographs are – entries without photos will be discounted. Q For Category Rewards – confectionery, crisps, e-cigs and so on – you must submit at least one photograph of the main fixture plus photographs of any relevant secondary sitings, or anything else that you feel adds weight to your entry. Q For Special Rewards – community, best refit, team and so on – please ensure that the photography you supply clearly illustrates the work you have done and allows the judges to fairly assess that work. Photos can be uploaded with your entry form via our rewards website www.slrawards.com. This year, you can also upload videos of the category within your store.
TOP TIP!
WE WOULD ENCOURAGE EVERYONE TO SUBMIT AT LEAST FIVE PHOTOS RELEVANT TO EACH CATEGORY ENTERED.
Also, it might sound a bit obvious but if the entry is for Soft Drinks, the judges want to see photos of the store’s soft drinks display/chillers – not a picture of the retailer outside their shop.
CATEGORY REWARDS Beer & Cider Retailer of the Year Confectionery Retailer of the Year Crisps & Snacks Retailer of the Year E-cigs Retailer of the Year Food to Go Retailer of the Year Newstrade Retailer of the Year Soft Drinks Retailer of the Year Spirits Retailer of the Year SPECIAL REWARDS Community Involvement Retailer of the Year Forecourt Retailer of the Year Scottish Brands Retailer of the Year NEW Post Office Retailer of the Year NEW Best Refit/ New Store of the Year Responsible Retailer of the Year ThinkSmart Innovation Award Team of the Year
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All category winners will be considered for the overall Scottish Local Retailer of the Year
Entry forms can be completed directly at: www.slrawards.com This is the preferred entry method. Alternatively, you can request entry forms by emailing events@55north.com and listing the categories you wish to enter. You will then be sent Microsoft Word versions of the entry forms.
BUSINESS BUILDING GETTING MORE OUT OF EPOS
EPOS:
SMALL CHANGES, BIG WINS
25-30% Time freed up using PayPoint One Pro
14%
Increase in category margin
75% Wastage reduction
IN THE SECOND OF OUR SERIES OF ‘HANDS-ON’ GUIDES TO INCREASING YOUR PROFITS BY LEVERAGING THE POWER OF YOUR EPOS SYSTEM IN ASSOCIATION WITH PAYPOINT, WE CONSIDER HOW YOU CAN DRIVE BIG WINS FROM SMALL CHANGES.
“PAYPOINT ONE HAS SAVED ME TIME, MONEY AND SPACE SO I CAN SPEND MORE TIME ON MY BUSINESS AND WITH MY FAMILY.” – MUHAMMAD RANA, PREMIER POPLAR STORES
IF YOU ARE INTERESTED IN FINDING OUT MORE
I
STEERING
n today’s ultrause the app to manage it,” GROUP competitive market, he adds. Interested in joining our it’s vital that all local That massive amount PayPoint One Steering Group retailers make the of extra time he has to help identify and share best very best use of every tool created for himself using at their disposal in order the system has been put practice? Email Antony at to make their business to good use, allowing him abegley@55north.com or more efficient and more to leverage the power of call 0141 222 5380. profitable. One of the easiest PayPoint One Pro to drive and quickest ways of doing just significant improvements in: that is by more fully leveraging the power of your EPoS system. MARGIN MANAGEMENT As more and more retailers realise the “To take my coffee range as an example of many benefits of having a system that can how I improved my margins, I used the control and automate so much of the work system to analyse my sales. I had previously of running a modern convenience store, it’s stocked high, mid and value ranges but also unquestionably true that a significant PayPoint One Pro helped me identify that the number of retailers make regular use of only mid-range just wasn’t selling. So I removed a very small proportion of their system’s that range and doubled facings on the other functionality and capabilities. ranges. The result was that my sales increased One of the principal reasons behind this and my margins from the category increased is the fact that many retailers, caught up in from 18% to 32%.” the day to day challenges of running their business, simply feel that they don’t have the PRODUCTIVITY time to dedicate to learning more about the “Typically, I used to spend about 50 minutes a capabilities of their EPoS system. day reviewing the daily books and about three One such retailer is Muhammad Rana hours on the weekly books. The PayPoint One who owns and runs Premier Poplar Stores in mobile app reduced the time I spent on my Huddersfield. Muhammad has been a retailer daily reviews by 75% and the cloud-based back for over a decade and took this store over a office allowed to me to reduce the effort on couple of years ago. He explains: “I’m always the weekly books by 25%.” looking for innovative solutions for my store and I chose PayPoint One EPoS Pro as the WASTAGE features were good and it has saved me time “Before I changed to PayPoint One Pro I was and money. throwing out around four or five cases a week. “It’s easy to convince yourself that you Using the system I now regularly review lines don’t have the time to choose the right EPoS that are not selling, I have cut stock holding system and get the best out of it, but I have and I have improved my weekly ordering discovered that it doesn’t take long at all to which has reduced wastage by 75%.” learn how to use the system efficiently – and the benefits arrive instantly.” STOCK TURN Muhammad’s two favourite things about “Previously I had no way of measuring stock the PayPoint One Pro system are “that it is turn and I was basing my orders on estimates. an all-in-one system and that it has a mobile Now I use the real-time reporting and sales app”. He says that having the flexibility to data analysis functionality on PayPoint One access his store information from anywhere Pro to analyse what stock is selling and over through the cloud has freed up his time by what timeframe. My stock ordering process “about 25-30%”. has been optimised.” “I have even stopped using a pen and paper All of the changes and improvements that for my cash and carry shopping list and now Muhammad made were done quickly and
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easily and the results have helped transform his business. “PayPoint One is the easiest EPoS system I’ve ever used and I like the fact that it is Android-based and always evolving,” concludes Muhammad. “It’s saved me time, money and space so I can spend more time on my business and with my family.”tasks that must be carried out routinely every day if profits are to be maximised.
PAYPOINT ONE HITS 11,000 USERS More than 11,000 independent stores are now using the PayPoint One EPoS system, benefitting from the technology and enhanced experience it brings. Launched in 2016, the all-in-one retail services platform delivers the full benefit of advanced cloud-based EPoS technology, contactless card payments and PayPoint services, such as bill payments and Collect+. The 11,000 milestone means well over half of PayPoint’s independent retailers have now converted to the new platform. PayPoint’s legacy yellow terminal will be retired during 2019. Lewis Alcraft, Commercial Director for PayPoint, commented: “We’re delighted to achieve this latest milestone, which further demonstrates our retail partners’ appetite for adopting exciting new technologies for their stores. Feedback has been extremely positive and it’s great to see a fast-growing number of retailers benefitting from the enhanced experience and business management that PayPoint One offers.”
Inside Business
Seattle Study Tour
Abdul Majid flies the flag for the SGF.
AMAZON READY TO GO? SLR joined a Scottish Grocers’ Federation study tour to Seattle recently to visit the original Amazon Go, among other things – and learned a sharp lesson about how quickly technology is set to shake up retail.
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BY ANTONY BEGLEY
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f you want to see firsthand how technology and next-generation customer experience is set to turn the world of retailing upside down, then Seattle in the extreme north-west of the United States is a great place to start. It may take a long time to get there, as a small Scottish Grocers’ Federation (SGF) National Executive delegation discovered recently when it visited the city on a study tour, but the effort was more than rewarded with fascinating insights into how fast retail is evolving. Seattle is an exceptional city for a number of reasons, not least the fact that many of the world’s leading companies are based there – Amazon, Microsoft, Starbucks and Boeing to name but a few. Why that cold and relatively isolated corner of the
States should spawn so many all-conquering businesses is not immediately obvious, but there’s no question that it’s an entrepreneurial hub. Far less brash, bold and brazen than New York or Los Angeles, Seattle nonetheless has an air of quiet, reserved self-confidence. It’s a very affluent city, clean and precise, but at fewer than four million people it is only the 15th biggest city in the US. Despite that fact it has a truly huge economic output, with a GDP in 2017 of around $357bn. To put that in some sort of context, the Scottish GDP is around $216bn. The purpose of the trip was ostensibly to visit the original Amazon Go, the cashierless c-store that has created so much fanfare in the trade press, but while we were there, we took the opportunity to visit a number of outstanding retail businesses, as well as a privileged trip into Microsoft’s HQ.
SLR | JANUARY 2019 www.slrmag.co.uk
Seattle Study Tour
The original Amazon Go.
AMAZON GO So much has been said of Amazon Go that it was almost a disappointment to actually enter what is, at the end of the day, a reasonably basic 1,800sq ft c-store with some nice shopfitting and a very limited range of products. But to dismiss the store on the grounds of how it compares internally to other c-stores is entirely missing the point. For me, the whole point of Amazon Go was to test the revolutionary technology – and the technology is revolutionary, as we will learn over the next 12 months. Range, shopfitting standards, merchandising and so on are largely irrelevant. Getting those elements right is the easy part – and Amazon will get them right as soon as they choose to do so. It was getting the technology right that was the real goal for Amazon. So, how does the technology work? www.slrmag.co.uk
Firstly, the store can only be accessed by downloading the Amazon Go app to your smartphone then logging into it using your standard Amazon login details. The app then displays a small QR code that must be scanned to pass through a set of gates at the store’s entrance. The process will be familiar in style to anyone who has used an airport recently. After that you simply do your shopping and walk out. Within a few seconds an itemised bill is pinged to the app and your account is deducted. It’s convenience shopping at its most convenient. The really clever part is the mind-blowing camera technology that tracks everything every customer picks up – and the system is, as far as we could work out, 100% accurate. And believe me, for the first time in our lives, our delegation tried its level best to steal something from a store,
as many others have done in the past. We lifted items up then put them back down somewhere else in the store. The cameras caught it. We put items back in their original place. The cameras weren’t fooled. We hid items behind other items in our hands. No joy. Bellshill Nisa retailer and SGF National Executive member Abdul Majid even had the bright idea of switching his phone off while in the store to see if that would confuse the system. No dice. The cameras worked and the bill was accurate. It’s safe to say that the technology works – but that’s only part of the story. One common assumption is that Amazon have developed this store format to eliminate the staff overhead. People are expensive so why not use tech to replace them? Five minutes in Amazon Go and you realise that this a myth. The store has staff wandering about constantly but what they’re mostly doing is chatting to customers, offering help, being friendly and basically just providing fantastic customer experiences. Shelf replenishment is done manually too and there is also a large kitchen to one side of the store which prepares fresh foodto-go all day long. Indeed, as one customer I spoke to pointed out, the reason they use the store is because the food-to-go is so fresh. As for the more traditional elements of the store, the range was geared towards food-to-go and ready meals (at the premium end of the spectrum) as well as a decent impulse range: soft drinks, crisps, confectionery. But, as SGF Chief Executive Pete Cheema pointed out: “The store sits right next to Amazon’s offices so the range is presumably aimed at that audience. Premium, fresh, healthier. I think the range simply reflects the customer base and I can see other Amazon
Inside Business
Go stores having very different ranges.” It’s an important point because Amazon has repeatedly hammered home how its sole interest is in providing its customers with what they want, rather than trying to sell shoppers what is has to offer. As an internet-based business that runs almost entirely on data, it has all the information it needs to give shoppers what they want. Amazon Go is no different. The nature of the in-store transaction means Amazon can analyse every single customer’s basket spend and inform future decisions based on that insight. It has already been reported that Amazon may now open upwards of 3,000 Amazon Go stores in the US and it has recently been revealed that Amazon is on the look for up to 200 sites in the UK. Rumours are currently circulating that the very first Amazon Go may even be ready to open in Central London any time now and, of course, there has been some noise around Amazon snapping up Morrisons. If these reports turn out to be true, the world of convenience and grocery retailing in the UK may be set for the biggest transformation in its long history – and it could happen very, very quickly.
WHOLE FOODS MARKET Amazon already exists on the streets of the UK, of course, in the guise of the Whole Foods Market chain it owns. Arguably the most impressive Whole Foods Market store on the planet, however, is to be found in Seattle. At well over 40,000sq ft it is a huge store and, it must be said, is nothing short of spectacular. The store is squarely aimed at the premium, organic end of the market – dubbing itself ‘America’s Healthiest Grocery Store’ – and is geared to be a foodie heaven. It delivers a phenomenal range of JANUARY 2019 | SLR
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Inside Business
Seattle Study Tour
Entry is via an airport-style gate.
A focus on healthier food and drink is evident. The uninspiring-looking camera system on the roof is what makes this store really special.
Helpful merchandising and POS are employed.
The alcohol fixtures are manned for age-verification.
The store is only 1,800sq ft.
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SLR | JANUARY 2019 www.slrmag.co.uk
Seattle Study Tour
The store is almost entirely laid out in a mission-based shopping structure.
fresh, chilled, frozen and ambient lines merchandised so exquisitely that it sometimes looks more like an art gallery than a grocery store. Interestingly, and in line with that ethos of bringing the best and freshest produce to market, Whole Foods is almost entirely devoid of price promotions, a marked deviation from the UK model where price promotions are ubiquitous. Needless to say, it’s expensive. A lunch of sandwiches and soft drinks for five came in at around $70, but the experience was special and the store was packed. The store also offers a twohour home delivery service that’s free on purchases over $35, while a speedier one-hour service is available for a fee of $7.99. Judging by the amount of deliveries awaiting pickup it’s a service that’s already popular with shoppers. Additionally, Whole Foods is rolling out ‘365 by Whole Foods Market’, a smaller less-expensive sibling that is set to take Amazon into yet more retail arenas. Don’t bet on that concept being unique to the US in the future.
FRED MYERS
Fred Myers’ Scan, Bag, Go cashierless solution.
The original Starbucks in Pike Place Market. Not your average coffee shop.
Starbucks Reserve, a level up for coffee lovers.
www.slrmag.co.uk
Close to Whole Foods is the more traditional grocery store Fred Myers, which we visited to view its own, more limited version of cashierless shopping. Known as ‘scan, bag, go’, the system is effectively an improved version of the self-scanning technology found in many UK supermarkets. Shoppers use a special tech-enabled shopping bag in conjunction with a handheld scanner. Purchases are then scanned and placed into the bag and customers can simply walk out once they are finished. It’s a neat enough system but it does appear to be more of a waypoint on a journey towards cashierless transactions than a fully-fledged solution. It is decidedly clunky when compared to Amazon Go.
Inside Business
STARBUCKS No trip to Seattle is complete without a visit to Starbucks and it is very difficult not to visit a Starbucks in the city. There is one on virtually every block in the city centre with the Foursquare app listing around 225 stores in the metropolitan area alone. The two that we were most interested in were the original one in Pike Place and the Starbucks Reserve in the city centre. The original store has been kept pretty much as it was, with original signage and bare bones interior. There’s not much to suggest that this innocuous little store would go onto become the cornerstone of a global empire. We visited the store on several occasions and the queue was never fewer than 50 people at any time. Starbucks Reserve is a sort of Starbucks on steroids, complete with its own in-store roastery and some seriously high end shopfitting. It has its own central horseshoe bar and looks more like a trendy pub than a coffee shop. It also appears to do a roaring trade in Starbucks branded paraphernalia, everything from clothing and games to coffee machines and cups. The lesson here is in the value of building a brand then leveraging it to the maximum by saying simple things over and over and delivering quality every time.
MICROSOFT A highlight of the study tour was a visit to Microsoft’s HQ, hosted by Iqbal Shahid, a family friend of Abdul, who happens to be a senior member of the Xbox team. The HQ is more of a small town than a headquarters. Over 100,000 workers are based there across around 130 individual buildings. We were offered a tour of the facility then were treated to an hour with our host who offered JANUARY 2019 | SLR
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Inside Business
Seattle Study Tour
Microsoft’s view of the world in general and how that world might impact on retail. The frankly alarming view offered was that “the internet will kill retail as you know it” and that there is nothing we can do about it. Shahid described technology as “the biggest unfair advantage of all” and said very matter-offactly that technology will begin eating into convenience retail too, and soon. Having the bricks and mortar store, he said, will “no longer be the winner”. His conclusion? “You can’t stop it. The only question is how you can adjust to it.” In the clear-sighted and straightforward way that techies often view the world, he advised that “whatever humans can do, machines can do better.” Shahid cited the example of how deliveries within 48 hours were seen as revolutionary not so very long ago, then it was within 24 hours, then it was same day and now it’s within an hour. “Retail will change dramatically,” he said, “and machine learning is what will drive the future. We will ultimately all be replaced by machines.” Interestingly, he also outlined his view that we will move from a product-based culture to a service-based one, and that this was already happening. In the future, he predicted, no-one will own cars or computers or holiday homes. They will all be sold ‘as a service’. To illustrate the point
we visited the Microsoft store that sits within the building and where customers can buy, for instance, a Microsoft Surface Pro ‘as a service’. Effectively this means a monthly fee and Microsoft provide a new computer every 18 months as long as you keep paying the monthly fee. Ominously, he also highlighted how “there are no brakes on Amazon” and how “Amazon is all about scale”. All of which makes it harder and harder for everyone else to compete as the retail behemoth gets more and more of that scale then delivers solutions that consumers love.
A huge and spectacular homage to high quality food.
CONCLUSION A few days in Seattle was a massively insightful and at times reasonably frightening experience, certainly from the point of view of local retailing in Scotland. Seattle may be an affluent little dot at the cutting edge of many aspects of retail but with the speed of change at the moment, so much of this cutting-edge technology will soon be mainstream and will be appearing on high streets and in out-of-town retail developments in the UK soon. And that’s before we consider the continued domination of internet retail. When convenience retailing’s most important USPs – it’s convenience and customer service – are no longer such trump cards, where does the
Whole Foods takes craft beers to a new level.
The store is focused on health and the environment. Quality for those prepared to pay the price – and many are.
A work of art as much as a fixture.
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SLR | JANUARY 2019 www.slrmag.co.uk
Seattle Study Tour
Sustainability is a key message in the store.
The food-to-go options are extensive for shoppers.
Inside Business
future lie for them? The world is changing. Technology will sweep all before it – and the time to start planning for that future, and how we should respond to it, is now. The key has to lie in our ability to evolve and change quicker than larger businesses – but without the bigger budgets of these businesses we have to be smart about how we do it. We can embrace technology quicker. Indeed, we must do so. We already know that the traditional model of convenience with its heavy reliance on impulse products and convenient locations is a potentially endangered species. The big question is whether we are willing and able to carve out a more sustainable niche for ourselves in a rapidly changing world where shoppers want everything and they want it now. If we don’t meet that demand there are plenty of businesses who will.
A special section of semiprepared foods to help those who like to cook from scratch.
Orders for home delivery await their courier.
www.slrmag.co.uk
Reduced packaging and old-school merchandising methods go hand-in-hand.
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Inside Business
Cloud Chasing Conference
CHASING I THE CLOUD: UP IN SMOKE? It’s time to clear the clouds of gloom hovering over the vaping category in local retailing and breathe some new life into it, says KAM Media’s Strategy & Insight Director. BY BLAKE GLADMAN
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t was a pleasure to speak at the recent SLR ‘Chasing the Cloud’ conference in Glasgow recently. I’ve been ruminating a lot about the name of the conference ever since we left Glasgow, in relation to the insights and discussions that came out of the event. Turns out there’s a lot of hidden meaning behind this name, that, perhaps, wasn’t intentional, but it’s certainly had me thinking. Chasing the Cloud. Clearly there are opportunities as big as the giant plumes of vape you see coming out of the devices themselves, but there’s more to a cloud than just condensed watery vapour. Another definition of a cloud can refer to a state or cause of gloom, suspicion, trouble, or worry. This later definition to me sums up where the UK convenience channel is at with regards to vaping. Whilst other markets, the US for example, are riding high above the atmosphere, the UK market continues to look at the category with a sense of trepidation, a sense of the unknown and, ultimately, is choosing to watch the category grow from afar rather than jump straight into the eye of the storm and sweep up all before it. As part of my presentation on the day, we conducted some exclusive research for SLR, whereby we spoke to 500 e-cig users/vapers in both the US and the UK to understand their vaping behaviours and influences. The aim was to highlight some key differences between consumers in these two markets. We have to look to the US, as they are the more developed nation when it comes to this category, and try and take the learnings from them at this early stage in the category’s development in the UK. Why the US? Put simply, they lead the way in some key trends that the UK have subsequently followed – and in a lot of ways, still trying to catch up with, for example, craft beers and premium spirits are two trends
SLR | JANUARY 2019 www.slrmag.co.uk
Cloud Chasing Conference
which started in the US and have begun to slowly be adopted by convenience retailers now in the UK. Looking further back, both coffeeto-go and hot food are two key staples of the US convenience store, and yet, still (bafflingly so to me at least) only 42% of UK convenience stores offer coffee-to-go and 22% offer hot food-to-go (ACS Local Shop Report 2018). So, it’s not just vaping in which we are behind the curve, but that’s a conversation for another day. How big is the US vaping/e-cigarette market I hear you cry? Well, according to which figures you believe, it’s estimated to be worth in the region of $6.6bn at the end of 2018 (I’m quoting Nielsen/Wells Fargo Equity Research 2018 figures here). Compare this to the equivalent UK market value of £1bn. Of course, the USA is a much bigger market, so you’d expect the value to be more. The key figure, though, is convenience and traditional retail has a 45% share of this market in the US, compared to a 16% share in the UK. This is the number that should have every UK convenience store owner’s head spinning. Clearly jumping from 16% to 45% share overnight isn’t possible, but what it shows me is that there is headroom for growth and the precedent has been set – there’s no excuses for convenience to not get behind this category and gain its rightful share. We asked both smokers and vapers in the UK and US about their future smoking/vaping habits, here’s what they said: Both markets have similar levels of vapers, but more interestingly 36% of UK smokers tell us that they are considering switching to vaping, compared to just 24% in the US. More importantly, these customers are the traditional foundation of a UK convenience store, so why is it that when they switch to vaping they also switch stores, or switch out of bricks and mortar shopping altogether? To try and understand why let’s start at the beginning. Here are the top four reasons why UK consumers vape:
www.slrmag.co.uk
Inside Business
This sentiment feeds into their purchase decision hierarchy, with the top four factors influencing where they choose to buy their vaping products from being ‘having a wide choice of products’ (22%), ‘having a wide choice of brands’ (18%), ‘access to recommendations and advice’ (12%) and ‘convenience’ (11%). The top three purchase influencers can be directly correlated to the key reasons as to why these consumers vape in the first place. The fourth response is one that should prick the interest for convenience retailers. For we know that the two key channels that currently have the biggest share of vaping spend are online and specialist vape shops. However, with convenience being a key purchase influencer, it’s no surprise to understand that the lack of convenience is one of the key barriers for consumers shopping in these other channels. So we’ve got convenience, but that’s because we’ve got lucky with our locations, outside of that it looks like we haven’t got a lot else going for us at the moment. However, there is something that we can do about it. There are three key areas which convenience retailers need to consider in order to begin to take advantage of the opportunity that exists in this category: 1. Getting the right range of products 2. Having the right selection of brands 3. Staff with the knowledge to advise and recommend Sounds easy, but it needs work and it needs passion… but it can be done. You just have to look at the craft beer and craft gin categories for proof of that. If you told anyone two or three years ago, that convenience stores would be able to dedicate whole bays to one product – let alone gin – you’d have been laughed out the room, and yet here we are. E-cigarettes/vaping is no different. We just need to understand the category and understand the consumer in order to, ultimately, understand the opportunity. Let’s not be overly ambitious but let’s say by taking on some of these learnings we can aim to close the gap and increase from 16% share to 45% share of the UK market (i.e. the US equivalent)… this could be worth £450m to the channel… and that’s before we even factor in any year-on-year growth of the category as a whole. This would place the E-cigarette/Vape category on a par with Health & Beauty and within the top 20 categories in a c-store. Don’t let your current lack of category knowledge cloud your judgement. Seek advice from those who have the knowledge and be open to the possibilities that exist. Following some simple advice and straightforward steps we can all unlock the growth potential from this rapidly growing market. Chase the cloud and reap the rewards. Make it rain people! JANUARY 2019 | SLR
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Product News
Cadbury Darkmilk Single Mondelez
Barr puts a new twist on energy drinks
Cadbury Darkmilk has extended its range with a new countline and tablet. The new Cadbury Darkmilk Single (35g) is available now in outers of 24 with an RSP of 65p. A 55p price-marked version is also available. This month also sees the launch of Salted Caramel, a new 85g tablet (RSP £1.49, outers of 16). The total brand will be supported by £6m investment with ongoing in-store, sampling, PR and digital activity. Darkmilk will hit screens for the first time in May 2019.
Barr Soft Drinks unveiled Rockstar Twister, a new range that taps into the current trend for retro flavours. Rockstar Twister rolls out in two variants – Smashed Blue Raspberry and Wacked Red Berry – and contains only 25 calories per 100ml. It is available to retailers now in outers of 12 x 500ml cans, pricemarked at 99p. “The introduction of Rockstar Twister will kickstart energy drinks innovation for 2019,” said Adrian Troy, Marketing Director at Barr Soft Drinks, “offering the great tasting, full flavour energy boost that shoppers have come to expect from Rockstar, with a retro twist – and fewer calories. “The new range performed extremely well in consumer taste tests, with 71% saying they would buy. The bold, impactful packaging will also drive standout on shelf and, in turn, enable retailers to grow sales from the energy category.” Barr Soft Drinks recommends retailers merchandise new Rockstar Twister as part of the ‘on the go’ section of the chiller.
Blood Orange & Mandarin Protein Water Upbeat Drinks
Rizla Polar Blast Imperial Tobacco
Launching this month, Blood Orange & Mandarin Protein Water will be available in 500ml bottles (RSP £1.79, outers of 12) with 12g of whey protein isolate, B-vitamins and real fruit. Each bottle has zero sugar and fewer than 55 calories. Bottles have six months’ shelf life and are ambient stable. The launch is backed by a £1m campaign that includes outdoor advertising as well as targeted digital engagement,
Billed as the UK’s first roll-yourown filter tip to contain a crushball, Polar Blast brings the popularity of factory-made cigarette crushballs to Rizla’s RYO accessories. Smokers ‘click’ the squeezable filter tip to release the taste of mint whenever they roll their own. Launching this month, Rizla Polar Blast contains 60 tips and has an RSP of 99p.
Hotlines
Ben & Jerry’s Spice & All Things N’ice Unilever Ben & Jerry’s new winter addition features creamy caramel ice cream and real gingerbread cookie pieces. Available now in 500ml tubs with an RSP of £5.49, Spice & All Things N’ice taps into the trend for ‘heat and sweet’ flavours and uses Fairtrade-certified ingredients.. The company is also using part of the proceeds from the new flavour to set up a fund to get refugee entrepreneurs started in the business world.
Llama Decorating Kit Dr. Oetker Dr. Oetker’s Llama Decorating Kit (198g, RSP £4) is a six-piece kit that helps home bakers create llamaand cactus-themed biscuits. The pack includes fondant icing, green colour gel, red and yellow writing icing, three sprinkle sachets, a llama and a cactus templates, and an instruction and recipe leaflet. Recipes for the biscuits and other ideas are on Dr. Oetker’s website, as well as a ‘how to’ video for the kit.
Ginsters Bitesize Sausage Rolls and Cornish Pasties Samworth Brothers Ginsters has extended its snacking range of scotch eggs, mini pork pies and cocktail sausages with bitesized Cornish Pasties (4-pack, 160g) and Sausage Rolls (5-pack, 200g). Both are available now with an RSP of £1.99. Ginsters said the packs would “allow convenience retailers to increase their on-the-go offering”.
for all the latest product news, head to www.slrmag.co.uk/category/product-news/ www.slrmag.co.uk
JANUARY 2019 | SLR
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Feature
Vaping
KNOWLEDGE KEY TO VAPING GROWTH The vaping market offers massive growth potential at this time as consumers try to give up smoking and the keys to unlocking that growth is staff knowledge and a strong core range.
FACTS ABOUT VAPING Q Public Health England has stated that vaping is around 95% less harmful than traditional tobacco Q E-cigarettes don’t contain tobacco and don’t produce tar Q E-cigarettes don’t use combustion to generate vapour Q Vapour particles are 73% water Q Not all vape products contain nicotine, vapers often reduce their nicotine levels – eventually down to zero – as part of reducing consumption
T E-VAPOUR FAST FACTS Q The are 3.2m vapers in the UK [ASH, 2018] Q Dualists represent 46% of vapers [Kantar, 2018] Q Around 8% of adults vape in the UK [Kantar, 2018] Q 40% of smokers have never tried vaping [Public Health England] Q 70% of vaping sales stem from online or vape shops [Ecigintelligence] Q Current category margins are between 25-50% [Fontem, 2017]
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SLR | JANUARY 2019
he vaping category represents an enormous opportunity for convenience retailers. The reality is that only around 17% of the £1bn category is accounted for by ‘traditional retail’ channels. In other words, about 83% of sales go through specialist vapeshops or online. “The vaping category is currently worth £177m in traditional retail in the UK and the future is bright, with 11.5% growth in the last year [Nielsen, Q3 2018]”, says Ross Hennessy, Head of Sales at JTI UK. But to make sure that bright future shines on convenience retail, there is a fair bit of work to be done by the sector to ensure it gets its share.
EDUCATION FOCUS Key to driving growth back into the category will be education and training, which is why JTI has established a team of ‘Logic Champions’ for its important range of Logic vaping products. “The Logic range holds a 12.4% share of the UK Independent and Symbol vaping market and 10.9% share of the overall UK vaping market in traditional retail [Nielsen, Q3 2018]”, says
Hennessy. “With the vaping category expected to continue growing, we remain focussed on working closely with retailers to support and grow their businesses alongside ours, for the long-term. “Our passionate team of Logic Champions are dedicated to sharing their knowledge and advice with retailers to make sure they are as prepared as possible to compete with multiples in vaping sales.” Imperial Tobacco’s blu brand also agrees that training and knowledge is vital to grow the sector. Chris Street, Head of Trade Marketing, says “With a dizzying number of devices and liquids, many consumers seeking to enter the category are unsurprisingly intimidated by the sheer breadth of the vape offering. These consumers need knowledgeable advice from retailers on what to buy along with reassurances on product quality and the benefits of switching. By taking the time to expand their understanding of the category, retailers can effectively advise these customers and grow their sales as a result.” Training is key to success in this regard and by making the time investment to educate all www.slrmag.co.uk
*
*Nielsen Scan Track Q1 2018 Unit Sales. Traditional Retail (KMG’s, Convenience, Independents & Symbols)
Feature
Vaping
MAXIMISE YOUR VAPING SALES Nick Geens, Head of Reduced Risk Products at JTI UK, offers some great advice on growing your sales.
KNOWLEDGE
FLAVOURITES
The top three vaping flavours are: Fruit (30%) Menthol (22%) Tobacco (19%) [Source: KTNS Omnibus, Q1 2018]
staff on the category, including the benefits of switching, retailers and their staff will be able to provide an exceptional level of service to customers that will encourage them to return again and again.
RANGE MATTERS With a well-trained team in-store, the second main tool in unlocking growth in the vaping category is a strong range that caters for the tastes of modern vapers. Nick Geens, Head of Reduced Risk Products at JTI, says: “The UK is the second largest e-cigarette market with over 3.2 million adult vapers [YouGov, 2018], and with the market expected to grow, the category presents an exciting opportunity for independent and convenience retailers. We are continually updating and releasing products to ensure we meet the needs of the ever-growing number of vaping consumers in the UK, and hope that we can help retailers maximise sales in this expanding category by responding with innovative NPD.” The latest data suggests that capsule and refillable products are currently the fastest growing devices and are now used by most 44
adult UK vapers. All of the biggest vaping brands now offer a range of capsule and refillable devices that cater for the majority of vapers’ needs. JTI has recently relaunched its Logic LQD range of e-liquid bottles with a new design and competitive RSP of £3.99. Retailers can also sell the revamped LQD bottles as part of JTI’s 3-for-£10 promotion Geens comments: “It’s also worth noting that lower strength e-liquids now account for over 29% of the segment [Nielsen, Q3 2018], so the extension of JTI’s successful Logic LQD e-liquids earlier this year with the launch of a lower strength (6mg) variant offers retailers a significant profit opportunity.” One of the most prominent recent trends has been the growth of the fuss-free capsule market. From a retailer’s point of view, capsules promise a more straightforward route to growth in the category because the purchase mechanism is very similar to that of tobacco. Customers simply choose a starter kit then buy new capsules as they require them. Logic PRO is currently the
number one capsule vaping brand in the UK, according to Nielsen figures to the end of Q3 2018. One area to keep an eye on is flavours as Brett Horth, CEO of Vapouriz Group, says: “Our main advice to maximise sales would be to stock a wide range of quality liquids – in a variety of nicotine strengths and flavours.” This is particularly true at a time of year like this where many people may be looking to quit smoking, as Horth explains: “To build on seasonal opportunities, giving up smoking remains the number one new year’s resolution, so make sure you are stocked up on quit kits and liquids for the new January vapers.” Horth also highlights the ‘Vapril’ and ‘Stoptober’ initiatives as dates to mark in the calendar for further down the line. But what exactly are new vapers looking for? “We tend to find the those switching to vaping start on a reasonably high nicotine content and a tobacco or menthol liquid, such as Original Tobacco and Double Menthol before reducing their nicotine strength and exploring the wide range of different flavours available,” advises Horth.
Q Be aware of the latest trends in the category and stock products to meet consumer demand. Retailers can visit trade websites like JTI Advance for a wealth of information or speak to a JTI sales rep.
COMMUNICATION: Q Communicating with customers is an area where independent retailers have an advantage over nearby multiples and vape shops. Using frequent conversations with regular existing adult vapers customers to adapt their ranges will help retailers maximise sales.
DISPLAY: Q Vaping products should be displayed prominently in store, in a clear and tidy vaping display to ensure customers are aware of the choice and range available. Q For smaller stores, or those looking to introduce vaping products for the first time, a countertop vaping display solution is a viable option to test consumer response to the introduction of the category. Q Once stores expand their vaping range however, it is best to move to a category solution where vaping and tobacco products are displayed in the same gantry to ensure quick service time and repeat custom.
SLR | JANUARY 2019 www.slrmag.co.uk
Fascia Focus
Feature
NEW YEAR, FRESH START? As the new year dawns and 12 months of challenge and opportunity lie ahead, many retailers may be looking to strengthen their business by either joining a fascia or symbol group for the first time, or by switching to a group that better suits their needs. SLR offers a guide to some of the best options out there.
T
he retail business is tough and it’s only getting tougher. Perennially rising costs and increasingly stiff competition mean that local retailers need every tool they can find in their armoury when it comes to running a successful, profitable business. With the new year now upon us and, hopefully, a fresh burst of enthusiasm, many local retailers may be looking to strengthen their business by either joining a fascia or symbol group for the first time, or by switching to a group that better suits their needs. Without the backing of a major group it’s becoming harder and harder for many retailers to maintain a competitive offering. The lure of becoming part of something bigger is an enticing one and is one of the few decisions that an unaffiliated retailer can make that is all but certain to improve the business. Access to much greater buying power and all the benefits that come with being part of a larger organisation can be the difference between profit and loss in today’s ultra-competitive market. Joining a symbol group or fascia doesn’t mean that retailers need to lose their independence – quite the opposite. While the different groups all have different criteria that members must meet in terms of buying commitments and compliance, the one thing they all share is commitment to allowing local retailers to retain their independent status, something that’s non-negotiable for most. But joining a group offers all the benefits of being part of a nationwide collective of likeminded retailers with access to big buying power and the many invaluable support mechanisms that membership of a symbol group brings. The attractiveness of that offer can be assessed by simply looking at the sheer number of stores that now belong to one www.slrmag.co.uk
symbol group or another. In 2002 around 22% of stores were members; that number is fast approaching the 50% mark today. One other point worth noting is that very, very few retailers decide to return to being unaffiliated after joining a group. They may subsequently switch symbols, but they don’t tend to go back to being unaffiliated once they’ve had a taste of what’s on offer as part of a bigger group. So whether you are considering joining one of these groups for the first time, or are considering moving from one to another, this guide will provide you with the key data you need to make a fully informed decision as to which fascia is right for you. The great news is that the range of choices available has never been greater. Each partner has its own particular strengths, but they all offer buying power, a household name above the door and a comprehensive support network covering everything a retailer needs to remain competitive in today’s retail environment. Choosing a symbol group can seem an intimidating task. It is a big commitment, especially if you are already tied into a contract or faced with joining fees – whether this is in the form of an admin charge, buying shares or paying for signage or delivery. But there is no doubt it can pay huge dividends. How to decide which symbol group is right for you will ultimately depend on your shoppers and what they want you to offer them. It might come down to the kind of store standards you are prepared to meet and your ways of working. If, for example, you are simply looking for a way of running promotions effectively then you might want to consider joining a cash & carry-based symbol group where you would normally go into depot and pick up the goods yourself. The pros for retailers considering joining
or switching symbol groups are numerous, not least because of the support a fascia can offer a retailer in every aspect of running their convenience store, from exclusive discounts and buying power to staff training, running a social media page and availability of new technologies. Being part of a symbol group gives you the backing and the knowledge, from promotions to posters and displays, along with the merchandising system and product knowledge to help make your business a success. Groups will send several reps and provide supplier contacts. They can offer an in-depth analysis of what you should stock, where you should stock it and how much you should be making. The support and advice that is given regarding store development should soothe shop owners who are nervous of change, and groups may introduce their own recommended shopfitter to give you help with project planning and store layout. Many also have their own consultants who can do detailed reports on potential or increased turnover. These can be simple or very detailed, taking into account the demographic area around the shop and local competition. Sometimes there will be a fee, but it may be worth the cost as often it gives additional industry-specific information that will support any application. This information, when backed by the weight of a symbol brand, can add an influential supporting voice to any finance application. Retailers should ask themselves whether remaining unaffiliated is detrimental to their potential as a business. Whatever level you decide to go in at, it is best to do your research before determining which symbol group is right for you. JANUARY 2019 | SLR
47
DO YOU WANT TO BE PART OF AN AWARD-WINNING GROUP?
Join Day-Today to become the very best in retail! The Biggest & Best Symbol Group in Scotland!
No Up-Front Costs!
No Membership Fees!
In-House Chill & Freeze!
500+ Stores!
Market Leading Technology!
Free Fascia!
Dedicated Support Team, Project Managers,
Best In-Store Promotions !
Symbol Development Managers!
Free Leaflets & POS!
and an In-House Merchandising Team!
The Day-Today group offers retailers the perfect package of a fresh, modern and professional image in your area, and combined with the right core range, fantastic value and friendly service, you will have everything in place to succeed. We have a nationally recognised consumer campaign; underpinned by high-quality fully integrated point of sale material and regular social media competitions and marketing for the benefit of your customers. We have invested heavily in technology and have a modern user friendly Ordering Website, Online-Delivery scheme OrderVago and Consumer-Engagement platform Darius to drive footfall to your stores. Contact Craig Lynn
07469 149 375
craig.lynn@uniteduk.com
www.uniteduk.com
mylocaldaytoday
BEST SYMBOL GROUP 2017 AND 2018
“We’re up against some of the top stores in the country and it’s quite good to get that recognition in such a short space of time.” “I think the success is down to a number of things.” “For a retailer like us, we have to make sure the community can get everything they need at a local supermarket without having to go to one of the giant stores.” Imran Ali, Award-Winning Day-today Bourtreehill
Social media is a great way to engage with your local community. Setting up a Facebook page is free and quick to complete. To assist you, we provide a full social media package which you can use throughout each promotional period: Deals posted daily
New products
Potential in-store services
Regular
competitions
Supplier media campaigns
Content
surrounding
major events
BEST SYMBOL GROUP 2017 AND 2018
Fascia Focus - Nisa
Feature
YOUR PARTNER OF CHOICE With a 40 year track record partnering some of the finest award-winning stores in Scotland, Nisa is your perfect partner for growth in an increasingly competitive and consolidated marketplace.
W
e have worked tirelessly for more than 40 years to ensure we provide all the tools needed to compete against the ever-increasing competition in the convenience retail sector. Importantly, we don’t have any company owned stores, so don’t compete with our retail partners and don’t have restrictive loyalty levels that impact on margin and the ability to trade independently. In May 2018 the Co-op completed its acquisition of Nisa Retail Limited. The wholesale operation will provide an environment in which independent retailers can flourish. It brings enhanced buying capability, allowing Nisa Partners to trade their businesses in the way they choose, backed by competitive prices and promotions with access to a deeper range. Independent retailers have the option to operate under a choice of symbol fascias; Nisa Local, Nisa Extra and dual branded whereby a partner can maintain their local identity whilst also benefiting from the strength of the Nisa brand. Alternatively, retailers can opt to trade under their own independent fascia. Nisa offers flexibility to retailers with their Store of the Future Evolution format which is a move towards a more modular development format, accommodating the individual demographic and shopping missions of every store, Nisa Abbey View in Dunfermline being one of the recent such developments. Latest figures show that Nisa partners who have converted their stores to the latest Evolution format over the past 12 months are enjoying sales increases averaging almost 12 per cent. A complete retail support package is offered, which comprises a strong retail focussed team, an enhanced category management system, a
staff training facility and a comprehensive marketing package incorporating bespoke leaflets, personalised Nisa FM radio, point of sale material and national advertising. Excellent social media support is also provided with partners receiving assistance in running their own sites. And the corporate Nisa Retail Twitter account celebrates partner successes as well as offering industry news, trading advice and Nisa business updates. Nisa’s flexible model provides its retailers with an unbeatable breadth of range comprising over 13,000 SKUs. This is supported by Nisa’s awardwinning own label range, Heritage which provides retailers with some 800 great quality products at affordable prices and includes numerous awardwinning lines such as the Heritage wine range launched in 2017. Nisa retailers now also have access to a wide selection of Co-op’s high quality own brand products across all categories. This is all delivered by Nisa’s industry leading supply chain which retailers can trust with an impressive 99.9% of deliveries made on the day and 95% successfully made on time. Nisa understands its retailers and their marketplace, enabling them to modify their offer to match the ‘local’ demographic and to create bespoke planograms and layouts within their individual sites. Through Nisa membership retailers can take advantage of the Retail Academy which provides a complete training solution to develop staff and help provide the best possible customer service. Retailers are offered a full support structure comprising of a strong field team covering Retail Development Managers and Regional Retail Managers, in addition to Fresh Food Development Managers and Store Development Managers who help further develop stores. And Nisa knows community involvement is key, and as such its retailers can support local good causes through Nisa’s Making a Difference Locally (MADL) charity, which has donated more than £7.8m to UK communities since its launch 10 years ago. Retailers can join the Nisa group through the partner website and can rely on superb support from the skilled in-house staff involved in the joining process.
COMPLETE THE FORM ON WWW.JOIN-NISA.CO.UK/CONTACT-US OR CONTACT OUR DEVELOPMENT TEAM ON 0800 542 7490. 50
SLR | JANUARY 2019 www.slrmag.co.uk
O T D E T T I M M CO
S R E L I A T E R R OU SINCE 1977
“I chose Nisa and have stayed with them because of the wide range of chilled and ambient products available just a click away, with the best prices in the market and great promotions for our customers. I’m so glad to be a part of Nisa as availability of stock is great with great delivery services.
I joined Nisa as an independent retailer many years ago, then I moved my store under the Nisa brand fascia in 2016, when we rebuilt the whole new building and we designed our store with Nisa’s outstanding designing and merchandising team. Recently we’ve also had a great chance to try Co-op’s best-selling own-label range which has increased my shopping basket.”
Join the family... visit www.join-nisa.co.uk
I’m looking forward to what’s to come in the future with Nisa. Mahmood Saleem, Nisa Local, Ardeer Services, Stevenston, Scotland
Feature
Fascia Focus - best-one
YOUR EXPERT RETAIL PARTNER With everyday low pricing, monthly consumer promotions to rival the multiples, an award-winning own-label range of over 400 SKU’s and monthly meetings with business development managers, it’s no wonder 362 retailers made the switch to best-one last year.
W
ith 38 stores across Scotland best-one is one of the largest symbol operators in the country giving retailers the scale and expertise to compete with multiple retailers and discounters. And with 362 retailers making the switch to best-one last year, it’s little wonder bestone is becoming the symbol of choice for retailers wishing to take their stores to the next level. best-one continue to offer one of the best rewards programes in independent retail where compliant best-one members can earn up to 5% rebate on their purchases through My Rewards. This reward can then be used to re-invest in store development including introducing the new premium grey best-one fascia. Among the many benefits of joining best-one are:
CATEGORY DEVELOPMENT Bestway Wholesale continually reviews its range and is increasing the size of the chilled range available to retailers, which has high retailer margin. Alongside this, the introduction of a food-to-go proposition will make bestone retail stores all-day destinations serving fresh sandwiches, snacks and coffee-to-go. best-one also has planograms for all core categories which help to reduce the number of lines on-shelf whilst giving stand-out to those products which will drive sales. Following this guidance will ensure independent retailers are in line with the rest of the market.
PROMOTIONAL ARCHITECTURE Members receive five unbeatable WOW Deals and 15 Must Feature promotions every month with case allocations to ensure members have availability throughout the promotional period and individualised store leaflets to drive footfall and loyalty. Shoppers now expect to see promotions that match the multiple retailers and best-one delivers on this
with promotions across impulse, chilled and grocery.
FIELD SUPPORT best-one prides itself on its continued support it delivers to members. Each member has a dedicated representative that draws up a joint business plan with members and regularly reviews this on their monthly call. This business plan is based on actual sales data and benchmarked against the store’s potential as defined by its shopper demographic. New members receive a six-week period of ‘Hypercare’ where they are visited weekly to ensure that the transition to best-one is as smooth as possible and that standards and sales are optimised.
STORE DEVELOPMENT With a variety of formats available based on shopper profiles and their missions, best-one works with members to deliver the best possible solution for their communities. From simple food-to-go solutions to full serve-over meal counters and premium coffee stations, best-one can help remodel, refit and revitalise your store. Central Pick operation gives members longer shelf life on over 1,500 chilled and fresh products, with up to three deliveries per week.
COMPETITIVE OWN LABEL best-one own label gives retailers the reassurance of award-winning, quality products for a value price, while delivering increased value to shoppers through price marked packs. With over 400 products in the range covering all major categories, sales of best-one own label continue to grow and the range continues to increase to meet shopper needs. The best-one inspired range also offers a smaller range of premium own label products and is the first premium own-label range available to independent retailers.
For more information, contact our Scottish Customer Contact Centre in Perth on 01738 646 666, your local Batleys depot manager or log onto best-one.co.uk 52
SLR | JANUARY 2019 www.slrmag.co.uk
Join the
UK’s fastest growing
Symbol Group!
362 retailers already made the switch to best-one this year
No
surcharges
Earn up to 5%
‘My Rewards’ discount*
Store investment available*
There’s a reason we’re called best-one Act now and join today! Call us on
01738 646 666 Or visit our website
www.bestwaywholesale.co.uk
Fascia Focus - Xtra Local
Feature
XTRA LOCAL RETAIL CLUB PROMOTION NUMBER XL12
NOW
NOW
12x300ml
NOW
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£10.60
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£5
£3.50 HALF PRICE NOW ONLY
NOW
£4
£1.75
4x330ml
NOW
PM £8.39 - 8x440ml
360g
£3
157g
500ml
PM £1.99 or 2 for £3.30 - 1.5 litre
NOW
£2.50 PM £2.99 - 70cl
£1
NOW
£12
70cl
NOW
PM £1.59-2/£2
620ml XL12 offers
available
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from 1st
December
to 31st
December
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OFFERS DECEMBER
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Xtra Local is the retail club opportunity from Bestway Wholesale, which offers independent retailers’ monthly promotions, competitive pricing and expert advice, whilst allowing flexibility and for retailers to keep their own fascia.
79p
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£2.29 BELOW HALF PRICE NOW ONLY
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PROMOTION NUMBER XL12
£1
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The promotional programme has been tailored for forward thinking retailers who want to entice their convenience store customers with a clear focus on the categories and pack sizes that are driving their business.
PM £2.49 - 200g
EACH
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PM £1 300g
NOW
£16
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£1
ONLY
NOW
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PM £18.99 - 70cl
PM £1 - 95g
NOW
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DECEMB ER OFFE RS
Offers available in store from 1st December to 31st December 2018
Xtra Deals at your local store!
290g
NOW
PM £4.25 4x440ml
NOW
NOW
10x440ml
NOW
£3.55
NOW
£2
In today’s increasingly competitive convenience market, Bestway can offer independent retailers’ solutions to suit their business needs through the Bestway Retail and Bestway Wholesale businesses; be that a Franchise such as Bargain Booze, a Symbol-Group such as best-one, special support for multiple-account customers, or through a retail club.
Stand out from the crowd and keep your own fascia while also benefitting from the scale and expertise of one of the country’s largest wholesale-run retail clubs.
£8.25
ANY 2 FOR
The Xtra Local retail club enables retailers to shop from 62 Bestway and Batleys depots within the Bestway Wholesale network, seven of which are in Scotland.
150g All items are subject to availability, errors and other omissions. While stocks last. Licensed products only available in Licensed stores.
Just some of the benefits of joining Xtra Local include: Q It makes commercial sense: there is no joining fee and the minimum spend is £1,000 per week excluding tobacco. Xtra Local members also get access to special deals, over and above those offered to unaffiliated retailers shopping with Bestway Wholesale through cash & carry. Q Promotions: The monthly cycle of consumer ‘Wow’ and ‘Must Feature’ promotions are supported with POS and leaflets for retailers to send to the consumer. These competitive deals allow Xtra Local customers to drive sales and footfall from the promotions whilst still delivering a healthy margin Q Own label: Xtra Local retailers have access to the best-one own label range which offers premium, award winning products for value prices on over 400 products across all categories Q Availability: Bestway Wholesale has also launched pre-sell on the core range relevant to Xtra Local customers, which ensures availability for retailers as stock is allocated when you order it a month ahead. This ensures you’ll be guaranteed the stock you need at the best possible promotional price – ahead of competitor prices for two weeks (and thus you’ll make more profit within the two week period) Q Support: Xtra Local provides independent retailers who meet the spend threshold, extra support including monthly visits from sales personnel and best-practise sharing from other retailers
CONTACT DETAILS POST: Xtra Local, 2 Abbey Road London NW10 7BW EMAIL: enquiries@ xtralocal.co.uk WEB: xtralocal.co.uk
54
Q Category management: Representatives from Bestway Wholesale can help Xtra Local members with category advise, store layout advise and merchandising plans Q Scotland: The Xtra Local product range is adapted for Scotland with special monthly promotions and a Scottish product range of approximately 400 products
SLR | JANUARY 2019 www.slrmag.co.uk
GIVE YOUR STORE
THE
FACTOR
Xtra Local Retail Club
The retail club that helps you grow your food and drinks business XCLUSIVE PROMOTIONS
PRO MOT
Fantastic promotional deals, promotions schedule and monthly magazine exclusive to members’, to help drive footfall. This includes deals on popular Scottish favourites
NOW
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75p
3 FOR
£1.20
ANY 2 FOR
PM £1 - 122g
Xtra Deals
£8
at your
£8
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Free point-of-sale and Scottish-specific consumer leaflets available to advertise the strong ‘Wow’ and ‘Must Feature’ shopper offers each month
PM £1 - 6
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JANUARY OFF ERS
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IMPACT
ISSUE 01/2019
Instor e 01/01/ dates 19 - 31/1/1
9
XPERT ADVICE Free advise and category planograms, and a dedicated local team to help and advise on building a successful business Promotion _Cadbur will bey WCE E19prici Bestwayng cont charged PLOF ained Front Page on invo within Advert_V 3.indd ices date 1 this d betw brochure een 17/1 2/18
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Email web@xtralocal.co.uk to arrange a visit or for more information go to www.xtralocal.co.uk or visit one of our depots for details Terms and conditions apply
– 31/1 /19 26/11/20
18 11:56
Feature
Fascia Focus - Post Office
DELIVERING GROWTH
With over 11,500 branches, of which 1,403 are in Scotland, Post Office is at the heart of UK life, and millions of people rely on essential services like pensions, bill payments, travel money and cash.
HIM RESEARCH SHOWS THAT ONE IN THREE POST OFFICE CUSTOMERS WILL BUY THREE OR MORE ITEMS IN THE SHOP WHEN THEY VISIT, AND 93 PER CENT OF SHOPPERS SAID THEY WERE MORE LIKELY TO CHOOSE A STORE BECAUSE IT HAD A POST OFFICE.
Traditional products and services remain core: working with partner Royal Mail, Post Office remains market leader for parcels and letters.
Post Office is opening more branches in retail outlets, especially in towns and cities, with more than 130 new post office outlets this financial year and more than 270 over the last three years. Thirty one of the new branches opened so far are in Scotland.
And as more bank branches close, the convenience of doing day to day banking at a local post office is popular with customers. Convenience is the key. Customers today want easy access to Post Office services so they can quickly return their home shopping, access their bank accounts and post items. A Post Office brings in footfall so there’s an opportunity to cross sell, and retailers who take on a Post Office find their sales increase.
Visit www.runapostoffice.co.uk to view existing opportunities or express interest in adding a franchise to your store. Payzone Bill Payments Limited now operate as a subsidiary of Post Office Limited - although they remain Payzone outlets and retailers. This acquisition means that Post Office and Payzone together now have around 25,000 locations for customers to pay their bills across the UK.
In a Post Office Local you’ll sell simpler and quicker services like mails, stamps, bill payment and e top ups from a small combi counter alongside your retail, meaning trained retail staff can serve all customers. The average Post Office transaction takes less than 30 seconds, and you’ll be able to sell these services during shop opening hours attracting busy customers earlier and later. Post Office pay a fee per transaction. Your premises need to be conveniently located for local customers, have easy access and enough space for the Local counter. Convenience stores, CTNs and forecourts are the most usual partners although Post Office will consider any suitable retailer. As part of the offer stores are kitted out free of charge with everything required to run the service including a Post Office terminal, cash, stock and marketing materials.
56
SLR | JANUARY 2019 www.slrmag.co.uk
Bringing you more customers with money to spend “Our shop benefited from the migration of the Post Office customers, and being open later brings in new people, so we’re really busy all the time. We stock a huge variety of food and deli products, so Post Office is a perfect addition.” Donna Morgan Biggar Post Office, Brownlies of Biggar, South Lanarkshire
runapostoffice.co.uk
“WE BELIEVE ONE STOP FRANCHISE IS THE FUTURE” The Hussain family have been in the convenience sector for over 32 years trading as an independent and under different symbol groups, before making the decision in 2017 to become a One Stop Franchise. It became clear to the Hussain family that with the ever more competitive environment they were operating in, they needed crucially to have the right range and offers to keep existing and more importantly attract new customers to their store.
Are you happy with your decision?
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We are a truly local family business where everyone has and continues to live, work and play in the local community
“Yes our like for like sales are up 25%. We have moved from a discount format which has increased our margin by 6%. Average Customer Basket spend is now over £6.50. The business is now promoted heavily but also profitably is bringing new customers to the store every day.” “One Stop Franchise and the model they offer speaks for itself.”
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Development “Our offer has been vastly improved by changing to a full franchise business model. We have managed to retain our independence whilst utilising the best attributes of a modern, successful convenience store business. Contactless and Apple Pay ensures our offer is kept right up to date. We support local suppliers and products, stocking local butcher’s meat and local cakes. We have introduced a Slush Puppie machine which is a massive hit with our customers. We have also introduced a “Free From” range.”
What’s been the customer reaction? “Customers are loving the refreshed, tidier store look and feel and commenting on the vastly improved choice within the range and the fantastic price, including the best ever promotions across their choice of local convenience stores”
Has One Stop made a difference to your life? “By utilising One Stop’s Franchise business model, our store has been transformed into a modern “multiple style” convenience store with ranges, pricing and promotions not previously available to us in the traditional independent sector. With support from One Stop we can look to the future with confidence and take our business to a different level.”
Join the multi-award winning One Stop family and see your business grow. MAKE IT HAPPEN. CONTACT US TODAY. Call: 01543 363 003 Visit: www.openaonestop.co.uk Twitter: @1StopFranchise Facebook: 1StopFranchise One Stop - the multi-award winning franchise
Fascia Focus - Costcutter Supermarkets Group
Feature
DEVELOP AND THRIVE
Committed to helping Scotland’s independent retailers thrive, Costcutter Supermarkets Group (CSG) is leveraging its new supply agreement with the Coop to offer retailers an exceptional range and simplified commercial terms.
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ur mission is to help independent retailers thrive, giving them the support they need to grow their business by meeting the changing needs of their local shoppers. “Following our new wholesale supply agreement with the Co-op, which went live in May, our retailers are even better placed to meet the needs of their local shoppers with an improved range, offer and delivery service with over 13,000 lines available. We’ve also rolled out over 800 Co-op lines with circa 1,000 more set to be launched in Q1 of 2019. “To coincide with our new supply deal going live, we’ve also introduced new, simplified commercial terms. Our retailers now benefit from the most transparent and easy to understand terms in the market, boosted by a rebate scheme that cannot be bettered. We’ve returned to our no levy, no surcharge model, backed by competitive bench-marked pricing, so our retailers can clearly understand the costs to their business. And our new rebate scheme rewards their purchasing, offering up to 6% rebate every 6 weeks. “Last year, following the most in-depth study of shoppers in our 30-year history, we launched our unique Shopper First Programme; a transformation programme that brings together shopper insights and sales driving range initiatives. “Every retailer has now been provided with detailed shopper
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profile information for their store, including details of our five core shopper personas. Armed with this detailed insight, our retailers can better understand their potential local shoppers and use this to develop a truly local offer that attracts new shoppers into their store. Combined with the new Co-op relationship, our retailers will be better placed to respond to key shopper missions, especially when it comes to the all-important fresh food and food-to-go categories. “Our new Costcutter brand and store design, which has been created to connect with today’s shoppers, stand out from the crowd and transform the in-store experience, has already been rolled out to dozens of stores. The fully flexible modular approach allows retailers to invest at a pace that suits their individual needs and focus on the key shopper missions. Along with the new Costcutter store design, participating retailers have enjoyed significant double-digit uplift to their sales and incredibly positive feedback from both existing and new shoppers. This new look Costcutter sits alongside the Mace fascia, so retailers can select the right brand for their store; all underpinned by shopper insights. “By putting the needs of shoppers first, we are providing our retailers with the ability to meet changing shopper expectations and buying habits, delivered through fresh, modern store brands that engage with shoppers and help them to continue to grow their business.”
SLR | JANUARY 2019 www.slrmag.co.uk
Helping you grow your business by putting shoppers first
Are you looking for a partner that will work with you to grow your business to its full potential? Look at what Costcutter can offer you! Fresh, new store brand Right range for your store Support from a team of experts Great promotional package Cutting edge technology solutions Great rebates - earn up to 6%
Our UNIQUE shopper insights drive new footfall AND increase sales with existing shoppers
Give us a call:
01904 232 505 l Come and meet the team l Let us show you our stores www.costcuttersupermarketsgroup.com
UTC
FESTIVE TV? IT’S LIKE WATCHING A TURKEY DEFROST Being firmly of the bah humbug persuasion, UTC never tires of complaining about the quality of festive entertainment on the telly. He nearly swallowed his Barlinnie-thinnie rollup however when he heard about a special programme that Food Standards Scotland was doing on Facebook in the run up to Christmas: they were doing a live feed of a turkey being defrosted. Yes, that’s right: two full days of watching a frozen turkey defrost on Facebook. Words cannot describe the mirth on the auld yin’s face as he invited everyone at SLR Towers to join him, loudly stating that it had to be better than repeats of Ben Hur, Home Alone and Love Actually. Food Standards Scotland’s next blockbuster Facebook shows may or may not include “watching a skip rust” and “watching paint dry”. [For any readers wondering what the point was, it was to illustrate “the potential health risks of failing to defrost your turkey properly.” An admirably serious Dr Jacqui McElhiney of Food Standards Scotland rightly commented that “nothing spoils Christmas like food poisoning”, unless of course, you are UTC, in which case a good dose of food poisoning is apparently much preferable to days upon days of enforced time with the wife and family pretending to be happy.]
FOR SALE: ONE SLIGHTLY DAMAGED IRONING BOARD Lacking a classified section, SLR has been forced to use this fine page to offer for sale one brand new and only slightly damaged ironing board with a premium quality Minky DripGuard Non-Drip Ironing Board Cover thrown in for good measure. One careful owner. It appears that the auld boy’s best attempts to choose a thoughtful, attractive and yet useful and practical Christmas gift for Mrs UTC went badly awry this year. UTC concluded from all the ironing that Mrs UTC seems to do, that she could do with a new ironing board and cover. And not just any old cover, no siree. This was a Minky DripGuard Non-Drip Ironing Board Cover “specifically designed for use with steam generator irons and high-performance steam irons to prevent drips while keeping the cover dry.” 62
His smugness on Christmas morning at having found the perfect gift after all these years quickly turned to shock and then fear as Mrs UTC realised it wasn’t a surfboard under all that sellotape and wrapping paper. What happened next remains a bit of a blur for the auld yin, but he definitely recalls coming back to consciousness some time later with a lump the size of a tennis ball on his noggin and a blinding headache. Which, to be fair, is what happens after most Christmas days at his house. But when he saw the ironing board with a sizeable dent in it he put two and two together and realised that his good lady hadn’t in fact appreciated the gift as much as he’d hoped. Apparently “ye cannae win”, he says.
HIGH RISK OF UTC BEING HIGH RISK
UTC maintains a strong interest in tracking all the various surveys that come out discussing Scotland’s alleged ‘unhealthy relationship with alcohol’, purely for professional purposes obviously. So he was black affronted when a junior member of the team at SLR Towers laughed at how UTC might be getting a wee phonecall shortly, after reading that drinks watchdog The Portman Group announced that “targeted help was needed to tackle the heaviest drinkers in the UK”. The latest analysis of drinking habits shows that drinking at harmful levels becomes “most prevalent in middle-aged people and in the most deprived areas.” [UTC middle-aged? He wishes! – Ed] Digging deeper into the story, it turns out that ‘higher risk’ drinkers consume over 50 units of alcohol. When UTC highlighted that even at the Christmas party he only consumed about 40 units, it was quietly pointed out that high risk meant 50 units a week, not a night. UTC promptly disappeared with a calculator and next appeared about an hour later having spent the time constructively in the The Rhoddie Dhu pub downstairs totting up his weekly intake on the back of a bookie’s slip. Unfortunately, said slip ended up being passed over the counter at the nearest one of William Hill’s fine establishments, so the findings will never be known.
SLR | JANUARY 2019 www.slrmag.co.uk
AN EXCEPTIONAL OPPORTUNITY TO ACQUIRE COMPANY OWNED SPAR CONVENIENCE STORES IN SCOTLAND
AVAILABLE INDIVIDUALLY OR AS SUB GROUPS
FOR ALL ENQUIRIES CONTACT: DANIEL ARRANDALE Director T: +44 131 524 3403 E: Daniel.Arrandale@christie.com
MARK LAVERY Business Agent - Retail T: +44 141 352 7309 E: Mark.Lavery@christie.com
www.cjlang.christie.com
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bluŽ e-cigarettes Š 2018 Fontem. 18+ only. This product contains nicotine which is a highly addictive substance. Not a smoking cessation product.