SLR November 2019 by 55 North

NOVEMBER 2019 | ISSUE 199

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NICKING FROM NACS

SLR Rewards winners visit US trade show

NOVEMBER 2019 | ISSUE 199

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THE NEXT GENERATION

SGF Conference review

ARE WE BLOWING IT?

Why is convenience losing market share in the vaping category, and what can be done to turn things around? SLR November 2019.indd 3

CJ LANG BACK ON TRACK Top team talks to SLR

CHRISTMAS TOP-UP

Cashing in on top-up festive opportunities

DEPOSIT RETURN SCHEME

Sturgeon confirms RVM rates relief 13/11/2019 12:00:34

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November 2019

Contents

Contents ISSUE 199

NEWS p6 p7 p8 p9 p10 p12 p24 p26 p27

Business Costs MSPs back a Bill proposing the first major reform of business rates in decades. Deposit Return Scheme In-store trial exposes the problems bottles will cause for smaller stores. Legislation Scottish Government launches a consultation on restricting the sale of energy drinks. Retail Crime A law to give shopworkers the same legal protection as police officers moves a step closer to fruition. Awards Wishaw store takes top prize at Bestway’s Retail Development Awards. News Extra Deposit Return Scheme First Minister announces rates relief for reverse vending machines. Product News Mondelez rolls out a considerable number of new eggs for Easter 2020. Off-Trade News A new premium cider brand aims to restore the lost orchards of Scotland. Newstrade The Daily and Sunday Telegraph are both to go up for sale after parent company’s profits plunge.

INSIDE BUSINESS p28 NACS Exhibition Review SLR Rewards winners Walter Bryson and Dan Brown visit the world’s biggest convenience trade show. p33 Research Digest Latest findings show consumers want retailers to be more adventurous with their vegan ranges. p36 CJ Lang Interview The Dundee-based wholesaler’s management team aren’t getting ahead of themselves in the wake of some positive financial results. p38 SGF Conference Last month’s SGF annual conference, held under the theme of ‘next generation’, was a lively affair. p42 Hotlines Barr Soft Drinks dusts off a vintage Irn-Bru recipe, giving Scotland’s sugar addicts something to shout about. p62 Under The Counter The launch of a Lynx car air freshener opens up new horizons for the auld boy. FEATURES p45 Fascia Guide SLR weighs up the options for retailers consider joining a – or switching their – symbol group. p50 Tobacco Despite a continued drop in sales, tobacco remains a vitally important category for local retailers. p56 Christmas Confectionery Shoppers stocking up for the festive period offer a great chance for retailers to cash in.

ON THE COVER p16 Vaping Does a shrinking share of the market mean that convenience has blown its chance in this lucrative category?

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NOVEMBER 2019 | SLR

13/11/2019 12:00:37

News BUSINESS COSTS Long-overdue move towards a fairer system

Lewis to leave Tesco Tesco boss Dave Lewis, who oversaw the supermarket chain’s £3.7bn takeover of Booker, is to step down next summer. In his five-year tenure, “the bloke that saved Tesco,” steered the multiple back into profit after it posted a £6.4bn loss – the largest ever in the history of British retail. Ken Murphy, Chief Commercial Officer at Walgreens Boots Alliance, will step into Lewis’s considerable shoes on a starting salary of £1.35m.

Suzohapp’s UK Managing Director widens remit Cash handling automation company Suzohapp has named Simon James as its new Executive Vice President of Retail & Transportation for EuropeMiddle East-Africa. James joined Suzohapp as UK & I MD last September and has since made “a very positive impact” on the business. The appointment will see him support Suzohapp’s

MSPs back overhaul of business rates Holyrood’s Local Government and Communities Committee has supported a Bill which proposes the first major reform of business rates in Scotland for decades. The Bill was introduced this March following the Barclay review, which made a series of recommendations seeking to enhance and reform business rates north of the border. In its Stage 1 Report on the NonDomestic Rates Bill, the Committee said a clear majority of organisations from local government, business and the non-profit sector supported the Bill, describing it as a move towards a “more modern and fair ratings system”. The report also welcomed the moves to change revaluations from every five to three years and to reform a ‘clogged’ revaluation appeals system.

James Dornan MSP Image © Scottish Parliamentary Corporate Body

There was also support for the introduction of the ‘Business Growth Accelerator’, which would reduce the rates bills of growing firms. The report also highlighted the need for practical steps to reverse town centre decline and revive Scotland’s high streets. Committee Convener James Dornan MSP said: “This is the first Bill for many years to make large

scale changes to the rates system in Scotland and there is no doubt that it will help provide a more modern and equitable ratings system. “We welcome much needed proposals to bring revaluations up to date with current market conditions and to reform an appeals system that has become almost an automatic part of the process for some ratepayers. “Despite our support for the general principles of the Bill, it should not be considered a silver bullet. More must be done to tackle the issue of town centre decline, and work must be ongoing to ensure the rates system does not block organic business growth and encourages the wider societal benefits we all want to see.” The Bill will now be debated in the Scottish Parliament.

international initiatives in the cashless payments area.

Cumbernauld store moves to EDGEPoS Spar Cumbernauld has become the latest store to install Henderson Technology’s EDGEPoS system. Store owner Surinder Bhogal said: “I contacted EDGEPoS as I knew it could be integrated with my CJ Lang/Spar wholesaler link.” The installation came as Henderson announced it had appointed Petroassist UK as an authorised EDGEPoS reseller in Scotland, England and Wales.

Bestway website updated Bestway Wholesale has

BUSINESS COSTS Living wage increase on horizon

WHOLESALERS

Conservatives and Labour both pledge wage rises for low-paid workers

Unitas unveils 2020 vision

The Government has revealed it plans to raise the living wage, which currently sits at £8.21 per hour, to £10.50 within the next five years. Speaking at the Conservative Party Conference in Manchester, Chancellor Sajid Javid also vowed to lower the age threshold for those who qualify from 25 to 21. The announcements follow the recent Labour party conference, where Shadow Chancellor John

improved the search functionality of its website by introducing auto-complete, a clear button, and ensuring products still appear if customers mistype words. Bestway’s Head of Digital and Marketing Salih Sheikh said: “We’ve ensured our e-commerce website carries the same usability as consumer shopping websites, so that customers get

Sajid Javid

McDonnell unveiled plans to raise the minimum wage to £10 per hour by 2020 for all workers over the age of 18. He also touted the introduction of a four-day (32 hour) working week within a decade, although Labour has deemed the idea of a Frenchstyle blanket cap unworkable. NFRN National President Stuart Reddish condemned the Government’s plans as a “step too far” and called for concessions for small retailers. “Besides having to pay our staff more in wages, every rate rise means we have to pay more in national insurance and pension costs,” he said. “Neither the Conservative nor Labour parties are considering the considerable financial burden and the implications on both staff hours and jobs that such moves will place on independent retailers.”

More than 320 delegates attended the ﬁrst Unitas Wholesale conference in Portugal to hear the wholesale services group set out its plans for the coming year. “For 2020, our plans are ambitious,” said Darren Goldney, the Unitas Managing Director. “We’re expanding the scale of Plan for Proﬁt and introducing new initiatives, such as Picture Portal, which are dramatically improving promotional execution.” Other retail plans include continuing with the Day-Today, Today’s and Lifestyle Express fascias, which equate to more than 1,000 UK stores, with plans to recruit an additional 120 stores per year. A new retailer magazine will launch in January 2020 to support retailers.

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13/11/2019 12:00:37

News DEPOSIT RETURN SCHEME Glass ‘a step too far’ for retailers

DRS: in-store trial lays out the problem with glass The Scottish Grocers’ Federation has renewed calls for glass to be excluded from Scotland’s forthcoming Deposit Return Scheme (DRS) following an in-store trial. Staff at the Keystore-Clydebank Co-op in Knightswood, Glasgow collected and bagged up 300 glass bottles, alongside the same number of aluminium and PET containers. As the picture shows, the store’s back shop was covered with 18 clear refuse sacks containing bottles; the cans and plastic containers were placed in same-sized blue sacks. These fitted into only three sacks each, taking up one-sixth of the space that glass did – and that was without any compacting. On the shop floor, the presence of only a few sacks behind the till soon hampered staff as they tried to serve customers.

Temporary change at top of PayPoint PayPoint boss Patrick Headon has taken a temporary leave of absence from the company to receive treatment for a medical condition. Headon is expected to be away from the business for around three months. The company’s Chairman Nick Wiles will act as Executive Chairman to support the Executive team during this period.

Thornton’s Budgens has peanut butter on tap Award-winning Budgens retailer and sustainability champion Andrew Thornton has started selling milk, orange juice and

Staff also voiced concerns about the weight of the bags and the extremely loud noise they made. The danger posed was also revealed when a sack was dropped, breaking one of the bottles inside it. SGF’s Head of Policy and Public Affairs John Lee commented: “The Scottish Parliament must say no to

glass. Retailers want to make this work: convenience stores are flexible enough to adapt to PET and cans, but glass is a step too far. “Frankly given the lack of space in modern convenience stores and the growing number of stores who offer food, having customers return glass to stores is simply wrong.”

peanut butter on tap in a bid to further reduce plastic pollution. Shoppers can buy reusable glass jars to ﬁll them with the everyday essentials. The move came as the store launched its new plastic-free Unpackaged range of 200 products in collaboration with environmental campaign group A Plastic Planet.

CO-OPERATIVES ‘Famous for food’ strategy pays off

‘Strong’ six months for Scotmid

Confex boss steps down

Scotmid Co-operative delivered “another strong half year performance” in the face of challenging cost pressures and Brexit uncertainty, according to boss John Brodie. Brodie was commenting on the publication of Scotmid’s interim report for the 26 weeks ended 27 July 2019. The Society made an H1 trading profit of £2.5m, up 8% on the equivalent period in 2018. Turnover also increased, up £3m to £190m. “The performance of our food stores was particularly encouraging with the continued work on our ‘famous for

buying group. Tom Gittins,

food’ strategy helping to drive growth in a summer period which did not compare with the record-breaking summer the previous year,” said Brodie. The Society’s recent charity partnership with the Scottish SPCA, RSPCA and USPCA, raised £325,000 to help teach primary schoolchildren about animal welfare. Despite the impressive first half numbers, Brodie expected the next six months to be more challenging. “The position on Brexit remains unclear,” he said. “The Society will therefore continue to focus on matters within our control.”

WHOLESALERS Spar Scotland wholesaler increases turnover for first time in four years

CJ Lang & Son grows sales Scottish Spar wholesaler and retailer CJ Lang & Son Limited saw a growth in sales and underlying profits last year, according to its latest financial statement. Figures released by the Dundeebased company for the year ending 30 April 2019 show a rise in turnover for the first time in four years, up 2.6%, to £187.9m. Margins also improved to 24.3%, from 23.9%

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the year before. Underlying profits, before exceptional costs, increased by 56% to £764,000. However, the booking of a £1.6m one-off cost, primarily to cover asset write-downs and lease charges resulting from the closure of several long-term loss-making stores, resulted in the posting of a net loss. Colin McLean, CJ Lang’s Chief Executive, said the numbers

confirmed the company’s strategy for growth was driving “positive change”. He added: “We will continue to follow our strategic path, focusing initially on a back to basics programme, coupled with initiatives to improve our offer, attract more independent retailers to Spar Scotland and to improve the profitability of our business.”

Nicky White has stood down as Managing Director of the Confex who was appointed as Director last year, has taken over with immediate effect. “After 25 years, I’m happy to hand over the reins to Tom and the brilliant team we now in place have at Confex,” said White. “I’m also looking forward to spending more time with my grandchildren.”

Meatless Farm Co hires Coke strategist British plant-based company The Meatless Farm Co has appointed Lone Thomsen to the role of Chief Marketing Ofﬁcer. Thomsen ﬁlled a strategic marketing for The Coca-Cola Company, including launching many of its recent NPDs like Fuze, Honest, Coca-Cola Energy and Signature Mixers. Prior to this, she held global strategy roles in leading media and advertising agencies.

NOVEMBER 2019 | SLR

13/11/2019 12:00:38

News LEGISLATION Voluntary approach from responsible retailers may not be enough for Holyrood

Camelot bikes a lot to say thanks a lot A 19-strong team from Camelot has completed a nine day 980mile ride from Land’s End to John O’Groats. The team visited a number of National Lottery retail partners and Good Cause projects during the challenge, to celebrate a quarter of a century of Camelot as National Lottery operator and raise money for charity. They gave out ﬂeeces and pin badges as a thank you for the last 25 years.

Asda to launch Costcostyle cash & carrys Asda is reportedly planning a chain of Costco-style warehouses offering shoppers bulk and own-label products at low cost – but with no membership fee. According to a leaked supplier brieﬁng note, the ﬁrst of these will open in

ScotGov ponders energy drink sales restrictions The Scottish Government has launched a consultation on banning sales of energy drinks to young people under the age of 16. The consultation, launched by Minister for Public Health Joe Fitzpatrick, welcomes the leadership shown by many retailers in controlling the sale of energy drinks to children. It aims to ask whether this is enough and, whether mandatory measures are now needed. And if so, how they might best be framed. This includes asking what the most appropriate age for any restrictions would be. Scottish Grocers Federation said it will take a “constructive and open-minded approach” to the consultation. Head of Public Affairs John Lee commented: “In our view

a voluntary approach to the sale of energy drinks has worked well. There is an ever-growing list of age restricted products and a mandatory approach will place more pressure on retailers and add to the overall compliance burden. Additionally,

effective enforcement would be a huge issue given the lack of resource available to Trading Standards.” SGF will fully consult its members as part of the process to submit a response to the consultation, which closes on 4 February 2020.

Bristol at the end of the month, with more to follow if it proves

CHARITY Event raises £920 and more than a few laughs

CASH

a winner. Asda owner Walmart

GroceryAid’s Scottish branch raises awareness with fun-ﬁlled quiz night

Bank rolls out new £20 note

already runs a similar operation called Sam’s Club in the US.

Shopworker a-voids prison after stealing thousands A Cambridgeshire c-store employee has escaped jail after stealing £12,000 by voiding transactions and pocketing the cash once customers had left the shop. Kerry Mowl was given an eight-month prison sentence, suspended for a year. She stole between £30 to £50 per day over an 18-month period by hiding the money under a notebook to transfer it to somewhere in the store uncovered by CCTV.

New-look Scotmid Inverkeithing reopens Scotmid’s Inverkeithing store reopened mid-October after it was forced to close in August when heavy rainfall caused considerable damage. The store has been completely transformed and Scotmid’s Head of Food Kevin Plant believes the local community will enjoy “the new ultra-modern lay-out and expanded range of products

Eighty colleagues from various sectors within the Scottish grocery industry attended The Admiral bar in Glasgow on 10 October for a quiz night in support of GroceryAid. The quiz raised £920 and increased awareness of the charity’s work. It was the brainchild of GroceryAid’s Scottish branch, which is entirely made up of volunteers from the grocery industry. Warburton’s Stephen Wilkes organised the event, which saw teams representing 14 different companies come together for an evening of quizzing, pies, beers and – most importantly – awareness. It was the team from Camelot that emerged victorious, winning a bottle of spirits for each member, while making great connections in the industry to continue GroceryAid’s Scottish support. Scottish Local Retailer’s team felt confident going into the final round sitting in third place. However,

Camelot: a spirited performance. despite getting only one of the last 10 questions wrong, it inexplicably slumped to finish fifth overall. The Scottish branch extended its thanks to sponsors who included Heineken, Bell’s Food Group and Ian McLeod Distillers. Co-chair of GroceryAid’s Scottish branch Peter Steel said: “This was a fun night which reflects the progress we are making as a charity in Scotland. While it was great to raise some funds, our focus remains on growing awareness. Events like this make that happen.”

The Bank of England has unveiled the design of its new £20 note, which will enter circulation on 20 February 2020. The polymer £20 note features the artist JMW Turner. It contains a raft of sophisticated security features that make it the most secure Bank of England banknote yet. For the first time, the note incorporates two windows and a two-colour foil, making it very difficult to counterfeit. The Bank’s Chief Cashier Sarah John said: “Being our most common note, the transition to the new £20 is the most significant, but I am confident that retailers and businesses will adapt to the change.”

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13/11/2019 12:00:39

News RETAIL CRIME Much called-for legislation lodged with Scottish Parliament

Law to protect retail staff one step closer to fruition Daniel Johnson MSP has formally lodged his Protection of Workers Bill to the Scottish Parliament, marking the beginning of a three-stage scrutiny process before it can pass into law. The Bill would create a separate offence and a statutory aggravation for the assault and impediment of a retail worker carrying out agerestricted sales. The Bill would be similar in scope and rationale to the Emergency Workers (Scotland) Bill that safeguards staff of the emergency services in their duties. Currently, workers dealing with age-restricted sales are personally liable for upholding the law, but do not receive the same level of protection as other professions,

Daniel Johnson MSP such as police officers, border staff and tax collectors. The bill as drafted would also extend to nonretail staff such as delivery drivers and those working in hotels. After a lengthy consultation and with crossparty support, the Bill will now be scrutinised by a Holyrood committee before a final vote by MSPs.

Johnson commented: “Abuse and threatening behaviour should not be part of the job, and with the busy Christmas shopping season fast approaching it is now more important than ever that this is recognised. “I believe this bill will secure the rights of all those who feel threatened at their place of work and will make it clear that such behaviour will not and should not be tolerated. Everyone has a right to feel safe at work wherever they work. SGF Chief Executive Pete Cheema thanked Johnson on behalf of Scotland’s 5,000 c-stores. He said: “This represents a oncein-a-generation opportunity to create a safer environment for retailers, customers and communities.”

Retailers spending more at cash and carry, says HIM Retailer spend per visit at cash and carrys has increased 40% since 2018, according to the HIM Wholesale Market Report 2019. HIM said the increase – an average rise of £358 year-onyear – was driven by a reduction in the number of distress top-up missions and a rise in the number of main restock missions.

Patricia nets two grand Patricia Sutherland, founder of Highland District Netball, has been named as the Scotland winner of Spar’s People’s Podium competition. Spar staff presented her with an award and a cheque for £2,000 for her contribution to sport in the Highland region. Over 4,000 people across the UK were nominated for the positive impact they had on their community.

SYMBOL GROUPS Successful trial results in ‘much better availability’

Nisa unveils next day twilight deliveries

Co-op gets personal with new member app

Nisa retailers are being offered a new ambient next day delivery service following a five-month trial. The next day twilight deliveries were successfully piloted on certain routes. They enabled Nisa partners to receive orders on the evening of day two, having placed them on day one. The additional delivery slots are between 5pm and store closing time. Retailers will get a phone call on the delivery day to advise on an estimated time of arrival. Retailer Siva Pandian, who took part in the trial, said

new app that lets its members

Scotland’s Speciality Food Show

evening deliveries led to much better availability for customers and increased sales. “We are essentially getting our deliveries a day early and so we always have the stock in our shop,” he commented. Jess Graves, Nisa’s Operational Improvement and Implementation Manager, said: “The service has been working well for partners, so the next step is to roll it out across the country and then in the future we will look at the possibility of adding chill into the offer as well.”

The Co-op has launched a download weekly personalised offers. Members can choose two offers every week and use them on top of any in-store promotions. The app also allows members to track their reward balance and removes the need for paper coupons.

19-21 January 2020 SEC Glasgow

Taste & Discover Something New

Over 175 suppliers with hundreds of great food and drink products for the speciality retailer.

For further details please visit www.scotlandsspecialityfoodshow.com

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NOVEMBER 2019 | SLR

13/11/2019 12:00:40

News AWARDS Scottish store picks up top prize

PayPoint unveils predictive text for parcel barcodes PayPoint has launched a service improvement to “signiﬁcantly reduce” the time needed to key in barcodes or the ECP numbers found on eBay parcels. If a barcode/ECP code won’t scan, the terminal autocompletes it once enough digits have been entered to trigger recognition. Codes are between 11 and 16 characters long but the system can complete them after as few as three digits have been keyed.

Costcutter teams up with Uber Eats Costcutter has partnered with Uber Eats, offering retailers discounted sign-up costs and superior margins with the home delivery platform. Costcutter retailers can sign up now and a series of regional demonstrations will be held in the coming weeks. The Uber Eats app will offer a wide range of products,

Wishaw winner at Bestway Retail Development Awards There was Scottish success at Bestway Wholesale’s Retail Development Awards 2019 when Asif Sardar of best-one Coltness, Wishaw was named as National Winner. The event, held on 17 October at London’s Marriott Hotel, saw a 400-strong audience of independent retailers, members of the bestone symbol group and Bestway Wholesale’s Xtra Local retail club, as well as key industry suppliers, gather to recognise the outstanding achievements and business successes of retailers from up and down the country. Asif also triumphed in the Beer & Cider category, while there was also success for Donna and Bruce Morgan, of Brownlies, Biggar, who walked away with both the Scottish and Wines & Spirits awards.

The annual Retail Development programme is exclusive to Bestway Wholesale customers and best-one Symbol Group members. It gives independent retailers the opportunity to attend a seminar offering advice and guidance on how to best meet their customers’ needs and a trade

show where they see new products from suppliers first hand. Retailers are then given six months to implement the learnings in their store to help drive sales before they have the chance to enter the Awards and potentially win a share of a total prize fund worth over £50,000.

including everyday essentials and “meal for tonight” options,

WHOLESALERS UWG doubles pre-tax profits

WHOLESALERS

along with drinks and sweets.

Record results for United Wholesale Grocers

Mann wins Women in Wholesale gong

Find virtual elf to win real prizes with One Stop One Stop has launched a Facebook Augmented Reality app for Christmas that gives customers an interactive instore experience and the chance to win prizes including an allinclusive holiday to Lapland. The ‘Find Eddy the Elf’ app works like a game of hide and seek, with virtual presents ﬂoating around One Stop stores for customers to click on and hopefully reveal a prizewinning elf.

Lidl lifts-off at Eurocentral Lidl has started operations at

Glasgow-based United Wholesale Grocers has announced record growth. The family-owned wholesaler reported a 19.6% rise in turnover to £148m for the year ending December 2018 while profit before tax increased to £2m from £900,000. Like-for-like sales excluding the company’s Gateshead depot – which was acquired in June 2018 – increased by £9.4m. “These are absolutely fantastic results and we couldn’t be more delighted,” the company’s

its new £70m distribution centre in Eurocentral. The 58,500m2 warehouse, Lidl’s largest in Great Britain, is a base for 600 existing Lidl employees, who relocated from Livingston. The site will support the discounter’s growing Scottish estate, set to hit the 100 mark in the New Year. A further 12 new stores are planned over the next three years in locations

Amaan Ramzan: “delighted”.

Managing Director Amaan Ramzan commented. “The industry is extremely competitive, and we continue to keep our core prices at marketleading levels to provide the best possible margin for our customers. We focus on actively engaging with our customers to fully understand their needs and this is leading to excellent sales.” UWG pounced on an opportunity to move into the north-east of England last year when AF Blakemore offloaded its 12 depots, including the Gateshead site. “Opening our new Gateshead depot has obviously played an integral part in the overall growth of the business, although both Glasgow depots have performed strongly too,” said Ramzan. “In the past year we have invested heavily in our depots and our team, and we will continue to do so as we plan for the future.”

Sue Mann, JW Filshill’s Group Marketing Manager has won the Best Newcomer of the Year category in the ﬁrst Women in Wholesale Star Awards. Mann’s video campaign for National Women’s Day was described by judges as a “brilliant initiative”. The awards ceremony rounded-off the fourth conference for the Women In Wholesale initiative. The event, themed around boosting personal and business performance, saw a diverse range of speakers and panel discussions.

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13/11/2019 12:00:41

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13/11/2019 12:00:49

News Extra

Reverse Vending Machines | Rates relief announced

NewsExtra NICKING THE BEST FROM NACS – P28 BUSINESS RATES Industry lobbying gets results

Convenience Matters with the SGF Recent reports from respected retail organisations such as British Retail Consortium suggest the retail sector has shed almost 60,000 jobs in the past year, while a constant stream of bad news about big name retailers folding means the High Street’s stock has never been lower. But scratch beneath the surface and a more positive picture appears. SGF has just launched the annual Scottish Local Shop Report 2019. Some of the key data is surprising and encouraging. For the first time since 2015 the number of stores has actually increased; about 600 stores went out of business between 2015 and 2018. Also, the number of people employed in the industry has jumped by about 4,000. The underlying reasons behind these welcome figures surely lie in the popularity of convenience stores with customers. On average customers visit their local store four times per week. Almost three-quarters (72%) of customers say they know the store owner and most live less than a quarter of a mile from their local c-store. Looking at the bigger picture we can see more macro-level data which lends weight to these numbers: IGD has estimated that the convenience channel will grow by 16% over the next five years to reach sales in excess of £50bn by 2024. There are real challenges, however. In Scotland the level of investment made by retailers in their business has fallen from about £80m to £64m. Increasing staff costs are undoubtedly a factor in this, as is an overall squeeze on margins. Convenience clearly has a future. It’s possible that it could be THE future of retail.

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FIRST MINISTER REVEALS REVERSE VENDING MACHINE RATES RELIEF

Retailers required to accept the return of single-use drinks containers could qualify for rates relief, First Minister Nicola Sturgeon has said. As a result of the First Minister’s announcement, shops have been guaranteed that their rates will not rise should they choose to install a reverse vending machine (RVM) to allow automated returns. Speaking at the Scottish Grocers’ Federation annual conference in Glasgow (25 October), the First Minister said: “The consequences of our throwaway culture can be seen in our streets, our countryside and our waters. But as well as being a depressing eyesore, the damage it causes our environment is irreversible. “We recognise the global climate emergency and the need for everyone to work together to improve the lives of current and future generations. Retailers will be critical to the success of our planned Deposit Return Scheme and by introducing rates relief, we are supporting them to play their part. “I look forward to the introduction of the scheme and the positive change in behaviour it will lead to.” The announcement was perfectly timed; a number of retailers at the conference had already given voice

to fears that their rates bills might actually increase if they installed a reverse vending machine. After the unwanted and unexpected news that glass bottles are to be included in Scotland’s forthcoming Deposit Return Scheme – in the face of widespread opposition from wholesalers and retailers alike – the announcement is a further sign the Scottish Government is finally listening to industry voices about the Deposit Return Scheme; exemptions for small stores were secured in the wake of concerted lobbying by SGF, which also pushed heavily over rates relief. The Federation’s Chief Executive Pete Cheema commented: “We have made a very strong case for this rates relief and we are proud to say that the Scottish Government has listened and delivered something of real benefit to the industry.” A new 100% non-domestic rates relief for reverse vending machines will take effect from 1 April 2020 in preparation for the scheme’s anticipated launch in April 2021. The relief will run indefinitely, ensuring nondomestic rates do not rise for retailers as a result of the installation of RVMs. www.slrmag.co.uk

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Comment

WE NEED TO TALK ABOUT SUSTAINABILITY It doesn’t take a rocket scientist to figure out that sustainability is going to be one of the key issues in the local retailing sector in 2020. We have a perfect green storm brewing with the Deposit Return Scheme finally beginning to take shape in Scotland, the likelihood that the Scottish Government will take some form of action on coffee cups, the manufacturers falling over themselves to reduce their impact on the environment and the great British public ensuring that sustainability is higher up the national agenda than it’s ever been. The one group still conspicuous by its absence from this great shift is the local retailing sector. Yes, some retailers are working hard to reduce their carbon footprint but, as a general rule, it’s very rare to see any sort of environmental messaging in most stores or even on their social media feeds. It still just doesn’t seem to be a thing for retailers yet. And that’s a dangerous position to be in. As local retailers, it should be clear that our unique relationships with our customers and the communities we serve across Scotland mean that we have a responsibility to proactively dre the sustainability agenda. Our customers care about the environment and the next generation coming through care about it even more. It’s already becoming clear that the green credentials of the brands they buy and the stores they buy from are impacting upon their purchasing decisions. They will choose another brand if yours isn’t doing its environmental bit. They will choose another store if yours seems to be shirking its responsibilities. The odd thing of course is that all local retailing outlets in Scotland already do a huge amount of sustainability work. They all recycle their cardboard packaging and they all recycle their food waste, for instance. But when was the last time you saw these facts communicated to customers? How much time and effort would it take to stick up of a sign in-store, or knock together a social media post explaining to customers that our industry already does these things? The fact that we typically don’t communicate issues like this suggests it’s more of a mindset challenge than anything else. That’s why we need to talk about sustainability. In our stores. On our Facebook and Instagram pages. Face to face with customers. They are all easy things to do and could transform your relationships with customers and perhaps even help attract new faces through the door, new customers who want to buy from a store that takes its sustainability issues seriously. When is the last time too that you communicated to customers around all the great sustainability work being done by many of the major suppliers? It would be easy enough to leverage that work for the benefit of your own store by simply adding a social media post highlighting how this supplier has changed the plastic they use, or that supplier has reduced the weight of its packaging by a certain percentage? We need joined-up thinking to ensure our customers know we are leading from the front to put the interests of their world and ours at the top of the agenda.

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 Kirsty McDowall 0141 222 5383 | kmcdowall@55north.com

CIRCULATION & SUBSCRIPTIONS Scottish Local Retailer is distributed free to qualifying readers. For a registration card, call 0141 222 5381. Other readers can 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 may 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.

ANTONY BEGLEY, PUBLISHING DIRECTOR

SLR | NOVEMBER 2019

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Cover Story

Vaping

VAPING: IS CONVENIENCE BLOWING ITS CHANCE? Somewhat alarmingly, the convenience retail marketâ&#x20AC;&#x2122;s share of the vaping market appears to be shrinking rather than growing. Does this represent one of the biggest missed opportunities of all time? And what can the sector do to start reclaiming its fair share? BY ANTONY BEGLEY

SLR | NOVEMBER 2019

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Vaping

Cover Story

£1.6BN Scale of the lost opportunity

n paper, the vaping market is tailormade for convenience stores. Long opening hours and convenient locations alone should have been enough to make the local retailing sector the channel of choice for the UK’s 3.2 million vapers. With such a dominant share of the tobacco category (45% of the market), convenience retailers should have been in pole position to capitalise on the phenomenal growth of the vaping category over the last four or five years. But that’s not what happened. As highlighted at SLR’s inaugural Cloud Chasing event around this time last year, the convenience sector only owned around 17% of what was a billion-pound market. The rest went to specialist vapeshops, online retailers and, to a much lesser extent, supermarkets. There was clearly a lot of work to be done if convenience was to reclaim its fair share of this massive category. So has progress been made over the last year? The massively disappointing answer to that has to be a resounding ‘no’. Figures presented by JUUL Labs at SLR’s recent #ThinkSmart3 event suggest strongly that not only is the convenience sector not growing its share, it’s actually losing share at an alarming rate and now accounts for only around 10% of the market. Even more concerningly, it’s losing share not to vapeshops or online retailers but to the supermarkets. The figures quoted by JUUL Labs showed that the UK market is set to more than double over the next four years from the current level of what they believe is a £2bn market to a massive £4.3bn – but the biggest benefactors of that growth unless things change dramatically will be the major multiples. The JUUL Labs data clearly shows that convenience is losing share rapidly to the multiples and the scale of that lost opportunity is enormous. At current rates, by 2022 the convenience channel will account for just £344m of that £4.3bn market, or 8%. If convenience was to get its ‘fair share’ of the market – 45% – that figure would be much closer to £2bn every year.

WHAT’S GOING WRONG? The key driver behind convenience losing www.slrmag.co.uk

SLR November 2019.indd 17

Convenience forecasted share in 2022

share to the multiples has undoubtedly been the rapid and efficient adoption of ‘pod’ based vaping systems by the supermarkets. JUUL Labs alone went from a standing start to be the number one pod player in the UK in well under a year; this growth was principally driven by securing listings in the supermarkets. Many of the other major players have also secured listings in the channel with the net effect that the supermarket share of vaping NOVEMBER 2019 | SLR

13/11/2019 12:00:56

Advertorial

THE LOGICAL CHOICE: CHOOSE COMPACT

he UK is the second largest e-cigarette market1 with over 3.2 million existing adult vapers2, and with the category worth £228 million in traditional retail3, growing 26.3% YoY4, it is an exciting sales opportunity for retailers nationwide. While new brands are constantly entering the market, JTI’s Logic portfolio has enjoyed continued success since its launch and was worth £23 million in the last year in traditional retail5, with growth of 21% yearon-year6.

TAP INTO TRENDS Nick Geens, Head of Logic and Reduced Risk Products at JTI UK, comments: “To best capitalise on the vaping opportunity, it is important retailers are aware of trends in the market such as the rise in popularity of closed tank devices, which is now the fastest growing vaping segment in the UK7. In line with this, Logic extended its portfolio in 2018, launching its premium pod device, Logic Compact. Following Compact’s successful introduction into the grocery channel, distribution has recently been currently running a limited time promotional offer on our Logic Compact device at just £4. The offer is proving hugely successful across some of our key accounts, with retailers reporting sales uplifts of 2.5%. We hope this great deal encourages retailers to grow their vaping range.” E-liquid pods for Logic Compact are available in a range of flavours and strengths, to help retailers stock a wide and varied range of products for a personalised vaping experience. Flavours include Tobacco, Menthol, Berry Mint, Cherry and Strawberry to cater to a range of customers, with demand for fruit flavoured e-liquids growing as it is the most popular vaping flavour within the category (41%), followed

expanded to include the independent and wholesale, with listings increasing across KMG and convenience accounts.” Logic Compact is a convenient and modern alternative to traditional vaping devices. It combines a user-friendly design with cutting-edge technology to deliver a combination of flavour, power and simplicity. The Compact range also includes magnetic refill pods for a hasslefree vaping experience. Geens, continues: “To help retailers profit from the thriving vaping market, we are by menthol (29%) and tobacco (19%).8 Geens concludes: “The vaping category is showing no signs of slowing down, and JTI is continuing to innovate to ensure we meet the needs of the ever-growing number of vaping consumers in the UK. We have a dedicated insights team that tracks market trends, so we can be sure to provide retailers with new Logic products that allow them to maximise the profit potential of the category.”

For more information, retailers should speak to their JTI rep or visit www. logicvapes.co.uk and JTI Advance.

Sources: 1 YouGov 2018 2 YouGov 2018 3 IRi Market Place, Value Sales, Total E-Vapour Category, Total UK, MAT September 2019 4 IRi Market Place, Value Sales, Total E-Vapour Category, Total UK, MAT September 2019 vs MAT September 2018 5 IRi Market Place, Value Sales, Total Logic Brand, Total UK, MAT June 2019 6 IRI Market Place, Value Sales, Total Logic Brand, Total UK, MAT June 2019 vs MAT June 2018 7 IRI Market Place, Value Sales, Total E-Vapour Category, Total UK, Latest 3 Months to June 2019 vs Latest 3 Months YA 8 KTNS Omnibus Q2-Q4 2018

SLR | NOVEMBER 2019 www.slrmag.co.uk

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Â£4 PER DEVICE

CLICK IT. VAPE IT. THE NEXT BIG THING IN VAPING.

*Subject to availability. Varieties as stocked. Participating retailers only.

SLR November 2019.indd 19

logicvapes.co.uk

13/11/2019 12:00:58

Cover Story

Vaping

is growing strongly – at the expense of convenience. Another major challenge is the elephant in the room, the scare stories from across the water in the United States. That issue became so significant that the UK Vaping Industry Association (UKVIA) was forced to produce a consumer media campaign calling for ‘facts not fiction’. UKVIA took full page ads in national newspapers including The Metro to target what it calls “misinformation and scarestories which threatened to push British vapers back to cigarettes”. At its heart, the cases of illness in the US have been linked to black market batches of THC, the psychoactive component of cannabis. The campaign set out to reassures the UK’s vapers that British vaping standards are robust, and products are highly regulated. Spokesperson for the UKVIA, John Dunne, said: “It may seem like a bold move, but we believe that the stakes are high enough to justify it. Vaping represents one of the most vital harm reduction opportunities for public health in decades. The UKVIA is determined to protect that potential, as well as protecting the vapers who have already made the lifechanging switch from cigarettes. To do this, the British public needs facts not fiction, and this is exactly what our campaign delivers.” In the wake of the US media storm, Public Health England once more reiterated that it views vaping as “95% safer than cigarettes”. UK vape firm VPZ, which has over 125 stores, backed the campaign. Director of Compliance and Manufacturing Doug Mutter said: “We need to call out these scare stories for what they are, as they run the risk of driving people back to smoking which would have a massive impact on public health. We’re already seeing people coming into our stores asking questions, and our staff are happy to take the time to correct the misinformation, but I’m very worried that not everyone will do that.”

17%

Convenience share of the vaping market in 2019

Steve Lintott, UK Head of Field Sales at JUUL Labs describes vaping as “the biggest public health and commercial opportunity of the last 50 years for convenience stores.” The harm reduction potential of vaping is widely recognised and JUUL Labs believes we need alternatives to smoking. Yet while smoking rates have been in terminal decline since 2011, there has been no discernible change in smoking prevalence among adults in Scotland. ONS figures show that around 14.7% of UK adults still smoke, equating to 7.2 million smokers in the UK spending £12bn a year. Consequently, if tobacco continues to decline with no alternative available, in 10 years’ time the tobacco market will be worth just 40% of its current value. To put that into context, that equates to a decrease in sales of £107m every month. And £107m is more than the total Retail Sales Value of brands like Mars Bars, M&Ms and Pot Noodle [The Grocer Britain’s Biggest Brands 2019].

WHY SHOULD WE CARE?

HOW DO WE FIX IT?

There are two key reasons why convenience retailers should be addressing the terrible performance of the channel in vaping: health and sales.

The good news is that the vaping market has plenty of room for growth and there remains a huge opportunity for local retailers to get back in the game.

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Vaping

The category is in 500% growth and, according to Public Health England figures, a whopping 60% of tobacco smokers want to switch. The key to beginning to unlock that growth comes down to a single challenge: retailers giving the category the time, effort, investment and space in-store that it deserves. A strong range of leading brands, well presented in-store coupled with a good staff training programme is all that’s required to start bringing new vaping shoppers to your door. That £1.6bn growth opportunity is a tantalising prize and once that no retailer can afford to ignore.

Cover Story

LOGIC COMPACT HITS WHOLESALE Launched in 2018, JTI’s premium pod device Logic Compact has now been introduced for the first time into the independent and wholesale channels. Logic Compact combines a userfriendly design with cutting-edge technology to deliver a combination of flavour, power and simplicity. The Compact range also includes magnetic refill pods for a hassle-free vaping experience. E-liquid pods for Logic Compact are available in a range of flavours and strengths including Tobacco, Menthol, Berry Mint, Cherry and Strawberry.

WHAT’S NEW?

MYBLU INTENSE STARTER KIT

Many of the key manufacturers continue to drive interest and excitement in the category with new product launches and brand extensions, as can be seen in the following panels.

Vaping brand blu extended its myblu portfolio with the launch of a new Intense Starter Kit featuring its Intense Liquidpods. The myblu Intense Starter Kit include the popular pod-mod vape device and USB charger, along with two Intense Liquidpods at an RSP of £19.99. myblu Intense Liquidpods feature nicotine salts (nicsalts) which allow nicotine to be absorbed into the body faster than normal e-liquids. This rapid absorption of nicotine allows myblu Intense to more closely replicate the experience of smoking a traditional cigarette, appealing to adult smokers looking to switch for the first time, or those who have tried vaping in the past and haven’t been completely convinced.

SMART VAPING JUUL Labs has launched its new C1 device that pairs with a smartphone to enable users to lock the device to prevent anyone but its owner using it. The app also allows vapers to monitor their usage in detail and includes a ‘locate your JUUL’ function to help users find a lost device. The C1 RSPs at £24.99.

DISPOSABLE VAPING PODS Blackburn-based Vape Dinner Lady has launched what it believes is the UK’s first disposable e-cigarette prefilled with premium quality e-liquid and pre-charged so it is ready to vape straight out of the box. Available in three flavours – Lemon Tart, Blue Menthol and Smooth Tobacco – each device is approximately equivalent to a pack of 20 cigarettes and retails for £5.99.

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NOVEMBER 2019 | SLR

13/11/2019 12:01:01

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SLR November 2019.indd 23

MODULAR CUBE

13/11/2019 12:01:08

Products

News

KP urges men to check their nuts this Movember KP Snacks has unveiled a

ProductNews

partnership with Movember which sees KP Nuts try to get more people talking about testicular cancer. A series of events and initiatives throughout November will raise awareness and break down taboos associated with the disease, including fundraisers in 150 pubs nationwide. KP will also support the partnership with an £850,000 out-of-home and print advertising campaign encouraging men to ‘Check Your Nuts’.

Border Biscuits in £3.5m sales boost bid Border Biscuits is investing £3.5m to boost sales in its hero product, the Dark Chocolate Ginger. A UK-wide campaign, ‘Famously Fiery’ includes advertising, TV sponsorship and online content. Border aims to increase its market share which is currently at 11% of all branded biscuits within the special treat category. The campaign follows the Lanarkshire-based company’s removal of over 90%

SGF CONFERENCE ROUNDUP – P38 CONFECTIONERY Category giant rolls out its Easter line-up

Mondelez puts eggs in severa Mondelez has unveiled its Easter line-up for next year, with a 24-strong range dominated by a basketful of egg-related NPD. Cadbury Creme Egg and Cadbury Mini Eggs Gifting Tins (409g and 319g respectively, RSP £5, 6 per case) are new for 2020. Mini Egg tins contain 10 Mini eggs bags, while Creme Egg tins contain eight Cadbury Creme Eggs and a bag of Cadbury Creme Egg Mini Filled. Easter 2020 will also see the introduction of the new Cadbury Dairy Milk Giant Hollow Bunny (175g, RSP £4, 8 per case), presented in a premium gift box. Staying with the bunny theme, Cadbury will partner with next year’s launch of the Peter Rabbit 2 movie. Characters from the film

will appear across more than 40 million Easter packs, including medium shell eggs, Dairy Milk Spring Edition tablets and a range of seasonal launches. CDM Vanilla Mousse Bunny will also feature Peter Rabbit 2 imagery on pack, as will the new

Caramel Shell Egg (125g, RSP £3.49, 4 per case), while Cadbury Dairy Milk Purple Eggs have been given a refresh. Available in shelfready cases of 12, the 77g product RSPs at £1.09. Easter will also see the launch of the Cadbury Darkmilk Easter

of plastic from its packaging earlier this year.

SNACKS ‘All I want for Christmas’ singer is face of crisp brand’s festive campaign

Two new ranges from Spar Spar Brand has launched a fully gluten-free range of sausages across both its standard and premium lines, and a range of Scottish-sourced fish. The sixstrong sausage range includes a selection of pork, Cumberland and Lincolnshire bangers with a luxury packaging design. The fish selection includes breaded, wet and smoked products. Dave Wright, Spar UK Assistant Brand Manager, said: “Provenance is really important, with a quarter of consumers being influenced by where the fish is caught.”

All Walkers wants for Christmas is Mariah Walkers has unveiled its biggest ever festive on-pack promotion and marketing campaign, featuring global superstar Mariah Carey. Not only will the 49-year-old singer be centre stage in a new Walkers Christmas TV advert, airing this month, but she will also be the suspiciously wrinkle-free face of an on-pack promo, which is live from now until the end of December. The promotion runs across the Walkers core range and gives shoppers the chance to instantly win prizes every hour. These range from game consoles and designer headphones to cash and festive socks. It is supported with a heavyweight marketing campaign, including TV, digital and in-store activity across November and December. Wayne Newton, Walkers Head of Marketing, commented: “The new on-pack promotion will help retailers cut-through during the largest sales period of the year and will attract shoppers with over 3,500 musthave prizes up for grabs, from a brand they can trust.”

“The vape category is at a critical development stage – driven by upcoming menthol bans on tobacco, retailers seeking better ways to sell product, a plethora of suppliers fighting over market share and incorrect negative publicity travelling across the pond from the US. At Liberty Flights we pride ourselves on providing high quality, objective advice to help retailers make well informed decisions on their best way forward. Now, more than ever, is the time to have good conversations so please come and visit us at the upcoming SLR event.” Matthew Moden, MD, Liberty Flights

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Products

News

BROUGHT TO YOU BY

Mountain Dew heeds the Call of Duty Mountain Dew has partnered with video game giant Activision on its latest release – Call of Duty: Modern Warfare.

veral baskets for Easter 2020 Egg (265g, RSP £8.15, 4 per case). Packs contain one large egg alongside one Darkmilk tablet. It is aimed at an older demographic, as is the Bournville Orange Easter Egg (280g, RSP £8.15, 4 per case). At the other end of the age range, Dairy Milk Treasures will launch two new SKUs:

Cadbury Dairy Milk Treasures with Freddo (150g, RSP £3.99, 9 per case) and Cadbury Dairy Milk Treasures with Buttons (143g, RSP £3.99, 9 per case). The winning ﬂavour from the 2019 Cadbury Inventor competition is featured in the

new Dairy Milk Choca-Latte Giant Egg (545g, RSP £9.99, 4 per case). Still with eggs, Mondelez will launch a new Heritage Collection. The four new products feature Fry’s Turkish Delight (161g, RSP £3.99, 9 per case), Fry’s Chocolate Cream (159g, RSP £3.99, 9 per case), Bournville (155g, RSP £3.99, 9 per case) and Maynards Bassetts Wine Gums (400g, RSP £3.99, 6 per case). Finally, Maynards Bassetts will introduce a Soft Jellies sharing novelty bag – Soft Jellies HappiNest (160g, RSP £1, 10 per case). For further enquiries, retailers can telephone Mondelez on 0870 600 0699, email retailer. services@mdlz.com or visit deliciousdisplay.co.uk.

The on-pack promotion gives customers 2XP with every purchase of selected Mountain Dew Citrus Blast and Mountain Dew No Sugar. Alongside competitions, the promo is supported with in-store, experiential, social media and out of home activity.

New look Nature Valley Nature Valley has given its Sweet & Salty Nut Bar range a new look that champions the product’s ingredients with improved taste and better-for-you cues. With a more premium feel, the revamped packaging also boasts new, distinctive font colours to help shoppers differentiate between the variants – Dark Chocolate with Nuts and Roasted Peanuts. New look four packs are available now with a £2.40 RSP.

Delice de France boss bakes up buyout Delice de France is no longer

SOFT DRINKS

Coke recycles ocean plastic into new bottles Coca-Cola has unveiled its first-ever sample bottle made using recovered and recycled marine plastics, to show that ocean debris can be used in recycled packaging for food or drinks. About 300 sample bottles were made using 25% recycled marine plastic retrieved from the Mediterranean sea and beaches. The bottles demonstrate the potential of new enhanced recycling technologies, which can recycle previously used PET plastics of any quality back to food-grade plastic – including material that would previously have been sent to incineration or landfill. The bottles are the first-ever made using marine plastic that has been successfully recycled for use in food and drink packaging. They were developed as proof of concept. In the immediate term, enhanced recycling will be introduced at commercial scale using waste streams from existing recyclers.

COMPETITIONS

Win Ferrero’s four grand store makeover Ferrero has brought back its Sparkling Store Makeover competition. As the name implies, retailers can win a sparkling store makeover worth £4,000, which will include bespoke festive decorations and a community event to bring local people together. Ferrero will also help the winner maximise Christmas sales by offering best practice tips and display materials. Entry is via Ferrero’s trade hub Your Perfect Store. Alternatively, retailers can tweet a video nomination of themselves, describing their perfect Christmas and nominating other retailers to share theirs, by using the hashtag #YourPerfectChristmas and @ FerreroYPS handle.

part of the Aryzta group of companies, following a management buyout led by Managing Director Thierry Cacaly. The new team has promised customers it will reach out to them to discuss any concerns or questions regarding the buyout. Cacaly said the move would allow Delice de France to focus on delivering innovation and quality within the UK market.

Skwishee promo saves a pile of plastic cups Skwishee has hailed its recent ‘Bring Your Own Cup Day’ initiative as a “great success”. Around 100 outlets took part in the campaign, which resulted in over 100,000 plastic cups being saved. Customers ﬁlled their own cup for £2.99. Despite a 25cm maximum diameter restriction, some enterprising punters still managed to stagger off with up to 10 litres of the frozen drink.

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News

Off-Trade

Tree surgery excuse fails to cut it A complaint about The Bearded

Off-TradeNews

Brewery’s ‘Suicyder’ has been upheld by the Portman Group. A member of the public was concerned the product’s name was a play on the word ‘suicide’ while packaging used noose imagery with a ‘juice from the noose’ strapline. The drinks watchdog didn’t buy an excuse the ﬁrm’s owner was a former tree surgeon who used a noose to remove unsafe branches.

‘Decadent’ gin launched Edinburgh Gin has unveiled what it’s calling “its most decadent ﬂavour combination yet”: Bramble & Honey Gin (70cl, ABV 40%, RSP £28). It joins the brand’s contemporary full-strength ﬂavour gin portfolio of Rhubarb & Ginger Gin and the recently launched Lemon & Jasmine Gin. In the past 12 months, Brits have bought almost 60 million bottles of gin, which now accounts for 68% of value growth in the spirits sector.

A spirited glimpse of 2020 William Grant & Sons has launched its annual report on the drinks industry, Trending 2020. The report offers insight on the

FIND THE RIGHT FASCIA – P45 CIDER Start-up looks to revitalise Scotland’s apple growing industry

New premium Scottish cider brand unveiled A Dundee-based farmer and his business partner have launched a new cider brand that aims to replant Scotland’s disappearing orchards. Lost Orchards is produced at a newly-installed cidery – funded by a £160,000 investment – on Andrew Husband’s farm, using Katy apples harvested from the farm’s orchard. Co-founder Angus Morrison said: “We have created first and foremost a Scottish premium brand original apple cider which we have developed further to include two fruit varieties.” The pair have also orchestrated the planting of 5,000 trees, as Husband explained: “We have formed a grower group who have already helped us plant thousands of trees over the past year and whose aim is to provide

Andrew Husband (left) and Angus Morrison.

us with home-grown apples for our cider for years to come. “Our brand ethos ‘For every sip we plant a pip’, means that every bottle sold will help us to re-plant the lost orchards of Scotland and return a long forgotten national industry to the heartlands of Scotland.”

Lost Orchards Pure Scottish Apple (ABV 4.5%), Scottish Dark Berries (ABV 4%) and Scottish Red Berries & Lime (ABV 4%) are all available now in 500ml glass bottles. For stock and other enquiries, retailers should email hello@thecrafters.co.uk.

UK drinks market, with a forward look on the key consumer trends shaping the industry, including premiumisation, innovation, and low/no alcohol. Visit trending2020.williamgrant.com to read the report in full.

Spar white takes gold Spar’s Regional Selection Breedekloof Chenin Blanc 2017 has been awarded Gold in the International Wine & Spirit Competition (IWSC). Judges described the wine as “an outstanding varietal example with great texture and a lengthy ﬁnish”. The Chenin Blanc is suitable for both vegetarians and vegans and retails at £6.50. This year Spar won a total of nine IWSC awards: one gold, two silver and six bronze.

BEER

Tennent’s pours out green T

New caps for Trooper

A £14m investment from Tennent’s will see the brewer cut single-use plastic from its packaging by 2021 and be entirely plastic-free by 2025. From next spring, the brand’s larger canned formats will use cardboard packaging as an alternative to plastic ring and shrink-wrap. Smaller packs will follow later in 2020. To further boost its sustainability credentials, the Wellpark brewery is now also generating biogas at an on-site water treatment plant, cutting its heating bills by 5%. Tennent’s said all the brewery’s energy will come from renewable sources by 2025. It also pledged to be a carbon neutral business by the same deadline, announcing a new carbon-capture facility that will break ground at Wellpark by the end of this year.

Robinsons Brewery and Iron Maiden have launched a series of collector bottlecaps, one for each of the heavy metal band’s 16 studio albums to date. Available while stocks last, fans will have to be quick off the mark to collect them all as some cap designs are more difﬁcult to ﬁnd than others. Rockers can also buy a special frame from Robinson’s Brewery to showcase their collection. The launch coincides with Iron Maiden’s ongoing tour and recently released studio collection. The new bottlecaps also appear on the Day of the Dead limited-edition bottle. Trooper is available from Booker and Makro.

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Newstrade

News& Magazines

News

Retailer margin cut on Record The NFRN has called on newspaper publisher Reach to

CASH IN THIS CHRISTMAS – P56

“properly reward” retailers after it was revealed that a cover price

NEWSPAPERS Poor circulation prompts sell-off

The Telegraph to be sold after proﬁts drop 94% The billionaire Barclay brothers who own the Daily Telegraph and the Sunday Telegraph are to put both newspapers up for sale after profits plunge.

rise on the Daily Record will be accompanied with a cut in the margin stockists receive to 20%. On 28 October the cover price of the weekday edition of the Daily Record was increased by 5p to 85p but, because the percentage margin is dropping down from 20.8%, retailers will receive only 17p per copy sold – instead of 17.68p.

It has been reported the owners of the Daily Telegraph and the Sunday Telegraph, Sir Frederick and Sir David Barclay, are reviewing all their key assets including the Telegraph Media Group (TMG) and that the group’s newspapers will be put up for sale. The latest figures published last month show that TMG’s profit for the last financial year was around £900,000, which represents a 94% drop on the previous year. The billionaire brothers acquired the papers in 2004 but

The following weekend the price of the Saturday paper increases by 10p to £1.30 which means retailers will receive 26p for every copy sold rather than the 26.78p they would have received had pro rata terms been maintained. NFRN National President Stuart Reddish said that at a time of declining newspaper sales, it was important for publishers to

recent years have seen sales fall through the ﬂoor. Average daily circulation of the Telegraph is now just 310,586 and 244,351 for the Sunday edition.

Reports suggest the papers could be formally put up for sale within the next 18 to 24 months, with the Telegraph itself the first asset to be sold.

incentivise retailers by properly rewarding those who are best placed to promote and sell their titles. He added: “This latest move by Reach gives retailers yet another reason to give greater

NEWSPAPERS Sun takes substantial sustainability step

The Sun removes 350 tonnes of single-use plastic Last month saw The Sun TV Mag remove its inner plastic polybagging across the UK and Irish editions, removing an enormous 350 tonnes of single-use plastic per year from the Saturday issue alone. Meanwhile The Sun on Sunday is also phasing out single-use plastic by the end of December. From January, this will be replaced by compostable film when bagging is necessary for the title. The move follows The Times and The Sunday Times removing all s i n g l e - u s e plastic outer polybagging in June. The Saturday and Sunday Times inner magazine polybagging will start to be replaced by paper-

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banding in early 2020 which, when complete, will finalise News UK’s plastics pledge to remove all single-use plastic used to wrap its titles and inner magazines by mid-2020. Retailers will continue to be paid the existing insert rate. News UK Retail Director Neil Spencer said: “This latest plastics move means News UK is now well on the way to removing 800 tonnes of plastic from the supply chain by 2020. We know readers and retailers have responded very positively to these changes on The Times and The Sunday Times and we are glad that The Sun is also now able to phase out its plastic inner polybagging.”

attention to higher margin categories and give these products more space in store to maintain or grow their bottom line. “We need the industry to promote print to our members and to their readers to ensure that newspapers are front of mind, loved and nurtured. The reality, otherwise, is that newsstands will be placed further back in our members’ stores and sales will fall yet further.”

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Inside Business

NACS Exhibition Review

WHAT CAN WE NICK FROM NACS?

SLR Rewards winners Walter Bryson and Dan Brown jetted off to NACS in Atlanta last month to see what they could learn from the world’s biggest convenience trade exhibition. Here’s what they discovered…

BY ANTONY BEGLEY

s convenience trade shows go, they don’t get any bigger than the annual NACS conference in America. Held in Atlanta this year, the show attracts more than 23,500 delegates from across the globe and this year that delegation included two of Scotland’s finest retailers, Scottish Local Retailer of the Year Walter Bryson and Scottish Young Local Retailer of the Year Dan Brown. The trip was the Reward that both won for taking the top prizes at this year’s SLR Rewards with Walter visiting courtesy of sponsor JUUL Labs and Dan visiting thanks to sponsorship from the Scottish Grocers’ Federation (SGF). I was lucky enough to join the touring party as was SGF Chief Executive Pete Cheema, keen to learn what we could so that we could share it with the wider retailing audience back in Scotland. 28

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NACS Exhibition Review

HUGE SCALE The show covers some 400,000sq ft of ﬂoor space and offered us a unique opportunity to gain critical insights into the latest developments in the huge US convenience market. Clearly, the trip also gave Walter and Dan the chance to discover some great ideas that they could take back home to implement in their own stores in Prestwick (Walter) and Musselburgh (Dan). Comprehending the sheer scale of NACS is no easy task. It runs over four days and features a mind-boggling array of presentations, demonstrations, education sessions, case studies, exhibitions and working groups as well as a few social events where the tens of thousands of delegates have the chance to get to know one another a little better. One of the key challenges facing our little group was to decide what the best use of our time would be. This was complicated by the fact that the event is tailored for the US market which differs from the UK market in some very fundamental ways. For example, the US convenience market is roughly 80% forecourts and 20% c-stores. In the UK that picture is more or less reversed. Similarly, the US has very different regulations when it comes to categories like alcohol and tobacco; it was a shock to see huge exhibition stands dedicated to cigarette brands – something we haven’t seen in the UK for a long time. But we did our best to make sense of the 160-page event guide and chose an agenda that exposed us to a little of everything including a handful of presentations on topics including food waste management, innovation

in retail, technology in retail and foodservice optimisation. We also managed several lengthy tours of the various exhibition halls with literally thousands of exhibitors.

KEY LEARNINGS The big learning? The US market isn’t so different from ours after all. Walter said: “I think the thing that maybe surprised me a little was the fact that a lot of what we saw in Atlanta was really quite similar to what we’re doing over here. There were one or two things that they perhaps do a little better than us like foodservice, but the bulk of it is very recognisable and I wouldn’t say that we’re lagging behind in many respects.” Dan agrees: “It was actually quite reassuring because while I learned a lot and really enjoyed getting a look at the US market in that amount of detail, I didn’t come away with the impression that we’re miles behind the US any longer. If anything, I think we’re probably slightly ahead of them in lots of areas like healthier eating, sustainability, in-store innovation and, dare I say it, customer service.” SGF Chief Executive Pete Cheema is similarly reassured by his experiences at NACS: “It’s a hugely impressive show and it’s hard to get around the whole thing in just a few days, but I came away with the firm belief that in Scotland the convenience sector is leading the way on many fronts. Yes, there was a lot to learn from the Atlanta trip but perhaps the biggest learning is that we’re no longer way behind the US, and in many ways we’re significantly ahead of the curve.”

Inside Business

WHAT’S BIG? FLAVOURED CIGARS There was a lot to see at NACS in terms of new product and service offerings but many simply won’t make their way over here. One big trend was ﬂavoured cigars with huge interest and dozens of stands offering mango, chilli, raspberry and vanilla ﬂavoured cigars, often in small 2-packs. Not something likely to trouble many local retailers in Scotland.

CHANCES OF MAKING IT BIG IN SCOTLAND? 0/10

HARD SODAS A big trend that might make its way over to these parts, however, was so-called ‘hard sodas’. Basically, flavoured spirit RTDs. Effectively these are repackaged and relaunched versions of what we once referred to as ‘alcopops’. They appear to be cashing in on the growth in craft beers with funky designed cans, bright colours and weird and wonderful flavours like grape, tangerine, cherry and elderflower.

CHANCES OF MAKING IT BIG IN SCOTLAND? 7/10

NICOTINE POUCHES One big US trend that has already started making it’s mark in Scotland is nicotine pouches. JTI has already launched Nordic Spirit over here but at NACS at least half a dozen companies had similar offerings, again often in quirky fruit ﬂavours. They’re effectively the latest versions of the once infamous Skoal Bandits but this time around they are tobaccofree and simply offer smokers and vapers more discrete, easier to use ways of getting their nicotine hit.

CHANCES OF MAKING IT BIG IN SCOTLAND? 8/10

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Inside Business

NACS Exhibition Review

COOL NEW PRODUCTS... The NACS show featured a modestly titled ‘cool new products’ room highlighting some of the latest NPD to hit stores across the US. Here’s a small selection of some of the most interesting.

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Inside Business

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Inside Business

NACS Exhibition Review

COKE WORLD As part of the trip, our little delegation was offered the chance by SLR Rewards sponsors Coca-ColaEuropean Partners to have a tour of Coke World, the immersive Coca-Cola experience in the hometown of the worldâ&#x20AC;&#x2122;s favourite soft drink. The entertaining tour looked back at the full history of the company and its most famous brand with plenty to get excited about, including the chance to see the vault (left) where the original recipe for CocaCola is (allegedly) stored.

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Research Digest

Inside Business

Retailers ‘not adventurous enough’ in plant-based offerings The latest research from IGD shows that consumer interest in vegan and vegetarian products continues be enormous, with consumers stating the retailers should be more adventurous with their ranges.

he recent plant-based diet megatrend shows few signs of waning, according to a survey of 2,103 UK shoppers at the end of September. Most shoppers interviewed (55%) are now actively reducing, or considering reducing, their meat intake. This is up from 52% last year. Some 21% currently follow or would consider veganism (up 4% year-on-year) while 36% currently follow or would consider vegetarianism (up 3% year-on-year) and 38% currently follow or would consider ﬂexitarianism i.e. reducing their meat intake but not giving it up altogether (up 6% yearon-year). Health remains the biggest driver of a plant-based diet overall (46%) but concerns around the environment has moved up the agenda (38% in 2019 vs 30% in 2018) and

is now the top consideration for younger shoppers (58%). Even among older shoppers there is considerable interest, with 40% of 45- to 64-year-olds stating they are either already, or considering following, a ﬂexitarian diet. Year-on-year, 11% of 45- to 54-year-olds and 14% of 55- to 64-year-olds have changed their positions to now say they’re either interested in following, or are already following, a ﬂexitarian diet. The opportunity for retailers is highlighted by the finding that 55% of shoppers think that retailers are not adventurous enough in their vegan and vegetarian offerings and would like more menu choices. Interestingly, 44% of shoppers also say it is confusing to determine which products are vegan when in-store, suggesting more extensive use of POS would be beneficial.

GROWTH OF ORGANIC FOOD ‘TWICE THAT OF NON-ORGANIC’

ast month’s Organic Trade Conference in London organised by the Soil Association saw 200 delegates attend and hear how growth in organic sales is now double that of non-organic sales, a trend the organisation believes is set to continue as demand for organic increases and shopping demographics change. Mike Watkins, Head of Retail and Business insight at Nielsen, spoke at the conference and revealed that organic sales are up 3.8% so far in 2019. Watkins described the level of growth as “impressive” considering the rate of inﬂation in 2019 has been low. He commented: “There’s growing interest in organic as it’s perceived as good for both individual and planet health. The mood of the nation is changing and there is a willingness to make sustainable changes that wasn’t there a few years ago – I think we’re at a tipping point. I expect to see a continued increase in demand for more

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products that are fresh, less processed and better for the planet and I do believe organic food and drink can lead the way.” This view was echoed by David Preston from brand agency The Crow Flies, who presented consumer research on changing shopper behaviours conducted for Soil Association Certification in Summer 2019. The findings suggest that consumer choice is moving from ‘individual centric’ to ‘planet centric’ decision making, as shoppers are increasingly considering the impacts they can have on the planet, rather than purely what a product can do for them as an individual. Preston said this presented a good opportunity for growth in sales of organic food. Clare McDermott, Business Development Director at Soil Association Certification, sees this as a major opportunity for retailers who can clearly communicate the proven sustainable benefits of organic. She said: “The latest sales figures and our research both prove that shoppers are increasingly concerned about where their food comes from and how it is produced. If everyone involved in the organic movement, from retailers to producers, consistently and clearly reinforces the sustainable benefits of organic farming to both people and planet, then we can convert a desire for change into actions that support organic.

QUARTERLY RETAIL SALES ‘IN DECLINE’ The latest Quarterly Trends analysis from the British Retail Consortium highlights how retail sales fell into decline in Q3 – a worrying performance that dragged the 12-month average down to a record low. This shows the plight of retailers, as increasing political and economic uncertainty have dampened consumer spending. Shop prices also fell into deﬂation in the quarter, following increases over the past year. Wages kept growing in real terms throughout Q3, extending the period of sustained real wage growth that began in Q1 2018. While the shift in consumer spend from in-store to online continued through Q3, meagre spending levels affected retail websites as well as store footfall. Both metricsw were in decline for the period, which contributed to the slowing of online sales to their lowest ever recorded. NOVEMBER 2019 | SLR

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The SLR Rewards will be back in 2020 for its 17th year and, once again, every winner on the night will be rewarded with a valuable personal prize. And the only way to win is to enter!

There really is nothing else quite like the SLR Rewards in the local retailing industry. Unique among a host of other awards ceremonies where the winners receive another nice trophy for their collection, the SLR Rewards stands out by giving retailers a valuable – indeed a sometimes money-can’t-buy – prize to recognise and reward all of the effort it takes to become the best in the business. Trophy hunters needn’t worry though; every winner also receives a stylish something for the mantelpiece. Previous years have seen our worthy winners jet off to Atlanta, Las Vegas and Chicago; we’ve sent retailers to Amsterdam, Belgium, Lille and London; they’ve cheered on at Champions League matches in Paris and Commonwealth Games events in Glasgow. We’ve had them tearing up racetracks in Ferraris, dining in Michelin-starred restaurants and watching global superstars from the best seats in the house. At SLR, we appreciate the hard work and commitment that goes into running a convenience store. We know that retailers work long unsociable hours, week in, week out. That’s why the SLR Rewards is a chance for Scotland’s local retailing community to collectively let its hair down and be wined, dined and entertained before finding out just who our winners are – and what amazing prizes they’ve won. The awards ceremony will once again be held in Glasgow’s Radisson blu hotel. It will take place on 11 June 2020. Of course, you don’t stand a chance of winning unless you take part. This year, the Rewards opens for entry on 2 December 2019 and will close on 14 February 2020. So be a sweetheart and enter before Valentine’s Day: it’s the first step on the road to Glasgow next June – and maybe even further!

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Inside Business

CJ Lang Financial Results

CJ LANG BACK ON TRACK

Dundee-based Spar Scotland wholesaler and retailer CJ Lang has been rejuvenated under the stewardship of Colin McLean with the latest set of financial results making for some very positive reading, not least that the company’s turnover has increased for the first time in four years. BY FINDLAY STEIN

“I think it demonstrates what we’ve said before, the sleeping giant has awakened.” COLIN MCLEAN, CHIEF EXECUTIVE

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t’s been a year since the new CJ Lang & Son management team broke with tradition and invited SLR up to their offices in Dundee to share their new strategy and open up about the new route they intended to take after a prolonged period in the financial doldrums. Prior to that, talking to the trade press – and indeed the wider world – had been something of a necessary evil to the Scottish Spar wholesaler and retailer so the new, more open approach appeared to show things had indeed changed in Dundee. At the time of that meeting Chief Executive Colin McLean was just six months into his tenure, and the line then from

Dundee was very much a “back to basics” approach. So what have 12 months of “doing the simple things well” delivered for the company? An increase in turnover for the first time in four years for one thing, up 2.6% to £187.9m. Margins also crept up to 24.3%, from 23.9% last year. Underlying profits grew by 56% to £764,000 before exceptional costs. It hasn’t all been plain-sailing, however, as McLean was content to admit last month, highlighting that the company nonetheless posted a net loss in its latest set of accounts, mainly due to one-off costs resulting from the closure of several loss-making stores.

“We’re moving very much in the right direction, but it’s an early start with a long way to go,” says McLean, who also accepted that his turnaround plan was given a considerable helping hand by 2018’s exceptionally long, hot summer. “We had record sales and record results,” he says. “The interesting thing was, as we came into this new financial year, we were on the back of some very strong like-for-like company store growth. It’s fair to say that settled back down a bit, but we’re still growing our like-for-like sales.” Finance Director Craig Tedford describes this 1.5% rise in likefor-likes from May to July as “a solid performance,” which is perhaps understating it, given this summer’s weather was indifferent at best and trading conditions haven’t been easy for the entire local retailing sector. “What we’ve seen coming out of the cycle, into August and September, are like-for-likes averaging 5 to 6%, which is above the level we saw outside of the summer last year,” continues Telford. “I think it demonstrates what we’ve said before, the sleeping giant has awakened,” adds McLean. “That’s us doing some decent growth on the back of decent growth last year.” That growth was given a considerable boost in June with the opening of Spar Havannah St, a stunning newbuild store in Glasgow’s east end that is firmly www.slrmag.co.uk

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CJ Lang Financial Results

focused on ‘transient’ food-to-go that has helped redefine what a modern foodservice-focused store looks like. McLean is justifiably proud of the store, describing it as “a great advert” for Spar Scotland. “It’s a good indicator of just how far the brand has come over a relatively short period of time as we get our act together and showcase best in class stores,” he says. Not one to rest on his laurels, McLean is keen to “take the best bits” from Havannah St and “rapidly roll them out across the business”. When he says rapidly, he’s not joking: “Our plan is to have a Costa Express in every company-owned store by the end of November.” He also hints that F’real milkshakes and Dots donuts will have a role to play in future store openings. “But we’re also going back into our existing company store estate and really taking the learnings from Havannah St.” One thing McLean has learned from the store is that “actually, we can do food-to-go” but that there must be a clear vision of what the proposition for companyowned stores will be. He explains: “Historically, we had about 113 stores potentially making their own decisions on ranging and pricing. I think where we’re going is a move towards central control.” Havannah St, with its pared down grocery range, has also showed food-to-go delivers a very different margin mix. “With some of the margins that we’ve historically been running our business, you’re not going to make a lot of profit,” says McLean. “This is about recognising, how do we get the right ranges, the right proposition, the right deal, and the right standards in stores that customers can see consistently across the estate. That’s what Spar Scotland stands for.” While he says the Havannah St ranging isn’t right for every location, McLean is keen to stress that CJ Lang is running its 113 company owned stores in “a very different way”. He is talking directly to retailers when he says: www.slrmag.co.uk

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“We’ve got some great ideas, great products and great opportunities, so come and join us.” And it appears that’s a message retailers are starting to listen to. “For the last four or five years, maybe even longer, the business has hovered around about 180 independent customers,” says Tedford. “That number is now 212. We’re also seeing independent retailers coming to us wanting to understand what it is that we’re doing.” Aside from quietly growing its customer base, CJ Lang is currently developing a new business strategy in which foodto-go will play a major part. To that end, the company is casting its net far and for inspiration. “We’ve been out in Belfast with Hendersons, working very closely with the best of their foodto-go proposition,” says McLean. There have also been several trips to Dublin, learning from cuttingedge retailer Thomas Ennis’s portfolio of innovative stores. “It’s taking the best pieces from around the world,” explains McLean. “With Spar in 48 countries worldwide, why wouldn’t we take the best bits? There are some great ideas at Spar International and I think that’s the difference. Hooking up the best from Spar International and Spar UK, and recognising the convenience retail model has got to change. There are challenges, but we’ve got a business that understands retail very clearly.” This less insular, more cosmopolitan approach is something company Chairman Jim Hepburn is at pains to highlight: “18 months on Spar Scotland is a much more outwardlooking business, and that’s proving to be very successful in terms of the levels of interest that people have now got in CJ Lang. “Whether it’s retailers attracting new retailers, whether it’s engaging with suppliers, or just engaging with the community, the changes in the last 18 months have been quite, quite significant. The business has a much more outward focus and we can look forward to the future with much more confidence.”

McLean agrees: “Who would have thought that 18 months ago you would have seen Spar Scotland sponsoring the European Championships in Glasgow? You would have never thought we’d be sponsoring the Scottish Ladies football team but there we were at the World Cup.” The company also recently announced a tie-up with the grassroots ladies football across Scotland. Its other big community initiative – a £1,000 donation to a local good cause for every company-owned store – is also generating a “huge response” and raising the company’s profile. With 300 stores across the nation, “Spar Scotland has got a clear role to play,” says McLean. “We’ve got the people and a business that’s starting to move in the right direction, but a there’s long way to go. It’s just the start of the journey.” Where that journey will take the business over the next five years will be unveiled at next year’s trade conference on 26 March in Aviemore; the sleeping giant may well be up and on its feet but it’s in no rush to stumble.

Inside Business

“For the last four or five years the business has hovered around about 180 independent customers – that number is now 212.” CRAIG TEDFORD, FINANCE DIRECTOR

NOVEMBER 2019 | SLR

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Inside Business

SGF Conference 2019 Review

SGF CONFERENCE FOCUSES ON ‘NEXT GENERATION’

The SGF Conference 2019 saw a packed audience gather in Glasgow to consider this year’s ‘next generation’ theme as the sector gears up for what promises to be a busy and challenging 2020.

ast month’s Scottish Grocers’ Federation (SGF) Annual Conference saw the annual event grow once more as the Federation continues its rebirth, bringing the industry closer together than it has arguably been for many years. Chief Executive Pete Cheema launched the conference, held at Glasgow’s Crowne Plaza hotel on 24 and 25 October 2019, under the theme of ‘next generation’. He opened the event by telling the audience that “what is extraordinary today will be ordinary in 10 38

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years’ time” and urged retailers to “challenge yourselves for today and strive for tomorrow”. That set the scene for a busy and often challenging two days of presentations, workshops, exhibition, dinners and networking opportunities as the industry prepares for a 2020 that is certain to include its fair share of challenges. The conference’s opening session kicked off in robust style with an in-depth examination of the forthcoming and highly controversial Deposit Return Scheme (DRS).

Session chair Antony Begley of SLR magazine described DRS as “probably one of the biggest changes to affect the convenience sector in living memory”. The prospect of glass being included in the legislation adds another layer of complexity to an already dense topic for retailers. Truls Haug, Managing Director of reverse vending machine (RVM) manufacturer TOMRA Collection UK, pointed out the benefits an RVM offers over a manual takeback system. He said a machine would www.slrmag.co.uk

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SGF Conference 2019 Review

increase footfall, reduce handling time and – thanks to compaction – cut down on storage space for returned bottles and cans. He also highlighted the larger handling fee (3.1p vs. 1.5p per item) that RVMs will attract. Haug added that there were benefits for customers too, who found the machines “fast and easy” to use. The other big player in the Scottish RVM market is Envipco UK. Managing Director Spencer Roberts reassured retailers worried about taking back large numbers of bottles they hadn’t sold. “You can’t be out of pocket,” he said, adding that unclaimed deposits will fund the scheme’s administration. He called on retailers to prepare for the April 2021 launch of DRS, suggesting they

Inside Business

FOLLOWING THE DRS SESSION, THE AUDIENCE SPLIT UP TO ATTEND A SET OF SEPARATE WORKSHOPS: CAMELOT Celebrating 25 years of running The National Lottery, the Camelot team thanked retailers for helping to raise £40bn for good causes. The lottery operator has been running ‘Operation Child’, which – as you might have guessed from the name – is an under-16 test purchase scheme. Scotland is ahead of the national curve in this respect, with a 91.7% pass rate. The Lottery’s new ‘Dream Big, Play Small’ campaign that looks to get “lots of people playing a little, rather than a few playing a lot” was also discussed, as was the Lottery’s forthcoming 25th birthday celebrations. With a £5.5m media spend for the event, retailers were advised to be on the lookout for new POS material. Mention was also made of a £15m must-be-won Christmas Day jackpot, a “great opportunity” for c-stores given that the mults will be shut.

CATAX Catax is a specialist ﬁrm that ﬁnds qualifying tax claims in businesses and is on target to save its customers £5m in 2019. It’s not a tax avoidance scheme, as the company’s Richard Armstrong was at pains to point out. He said HMRC has £1.9bn to give back to business, as every one of these pounds then generates a further £2.30 in revenues. Tax relief can be claimed for research and development costs – money spent on a new project, product or process. A somewhat pleased Asim Sarwar was on hand to say United Wholesale Scotland got £381,000 spent on a new bespoke IT system back. Limited companies can claim for the current tax year and the two years before that. Armstrong said the process was “too niche” for most accountants and that clients claimed back an average of £56,000 “for three hours of your time”.

ENVIPCO Envipco’s breakout session took a quickfire question-and-answer format, with Spencer Roberts fielding retailers’ queries. Is an RVM better sited inside or outside a store? Roberts said there was no right or wrong answer. It’s all about customer flow, he said, adding that people might just use the RVM then go away again if it was outside. When asked about the working capital impact, he said it would take 30 days for retailers to get reimbursed by the scheme’s administrator; he urged retailers to engage with the consultation process and ask for weekly payments. He also addressed hygiene concerns, saying machines were designed to be easily cleaned while freely admitting their conveyor belts needed regular attention. Roberts said it was unlikely retailers would need to buy an RVM, and that handling fees should cover the cost of leasing.

HEALTHY HEMP The Healthy Hemp Company is a “seed to sale” business that markets a range of products containing CBD, a compound extracted from cannabis plants that doesn’t get you high but is thought by some to help manage inﬂammatory-based illnesses like arthritis. Suppliers can’t make any medical claims for CBD, which makes promoting the stuff a tricky business for people like Tim Henley, Healthy Hemp’s UK Business Development Executive. Henley, however, clearly believes in his product range – which includes oils, seeds, tinctures and cosmetics – and the wider market. This, he said, is currently worth £1bn and will more than double in 2020, with uptake in the next generation, millennials, particularly high. No pun intended.

use a figure of 90% of their sales volume as a rough indicator to what they might expect to collect. In what could perhaps best be described as a lively panel discussion, Ian Lovie – Licensing and Compliance Manager for Scotmid – shared his learnings from a year-long trial of a TOMRA machine in Scotmid’s South Queensferry store. This was “a largely positive experience” he said, although he admitted the machine had be cleaned regularly and had a few issues with wasps. With previous www.slrmag.co.uk

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TOMRA Zac Miller, TOMRA UK’s Senior Account Manager laid out what he hoped was “a very strong business case” for RVMs. Citing the public consultation, he said threequarters of customers want to recycle, and warned retailers that the cost of not having a good DRS solution in-store would be £1,150 per year for every customer who went elsewhere with their drinks containers. He said the cost of an RVM had to be balanced against the costs of manual take-back, which included staff and operational costs, a cost in space and the cost of wrongly paying out deposits on items not in the scheme. Miller also pointed out that DRS was an upselling opportunity, and that the vouchers dispensed by machines, as well as their touchscreens were a great way to engage with consumers.

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Inside Business

SGF Conference 2019 Review

experience of manually handling empty glass bottles, Lovie said a machine was his preferred option. Retailer Dennis Williams, owner of the Premier Broadway store in Edinburgh, has also trialled an RVM, raising £1,700 for local charities in the process. Dennis said the store saw additional footfall during the trial. Based on the results of a recent manual handling experiment, Craig Brown, Retail Sales Director for JW Filshill, said glass was “18 times less efficient” for retailers compared to plastic and aluminium. Dennis agreed, saying that weight was a particular concern. He was worried members of staff might struggle with bags that stronger colleagues could comfortably handle. Brown also highlighted the serious cashﬂow impact of DRS – Filshill will have to find somewhere between an additional £1m to £1.6m on day one of the scheme. There are already issues around multipacks, Brown added, using the example of an 18-pack of Irn-Bru that KeyStore has on sale for £5. DRS will push the price of this up by 20p per can to a total pack price of a staggering £8.60. This might drive consumers back towards 3-litre bottles and could potentially “totally change the landscape of convenience stores.” When asked if it would be possible to postpone the inclusion of glass in the DRS to allow the infrastructure to deal with it to be put in place, Jill Farrell, Chief Operating Officer for Zero Waste Scotland, said the cost of retrofitting would be more expensive that including it from the outset. She also said current models, that see recycling rates of 60%, aren’t good enough. SGF’s Head of Policy and Public Affairs John Lee said Scotland could have a worldleading DRS if the system was built around local retailers rather than supermarkets due to the sector’s ability to connect with local communities. He said convenience stores were in a unique position to grab the next generation of consumers, the generation most concerned about the environment. Based on the evidence of the several trials conducted in Scotland to date, Lee said a machine-based solution was best for local retailers. “If you were trying to come up with something to destroy the business model of a convenience store, it would probably be manual take-back,” he concluded. The day’s sessions concluded, the focus shifted to the annual dinner hosted by comedian Des Clarke. The lively evening included a rafﬂe that raised over £2,500 for the SGF Benevolent Fund and gave attendees the opportunity to let their hair down. Bright and breezy the next day the business sessions recommenced under the chairmanship of CJ Lang’s Jamie Buchanan. 40

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SGF Conference 2019 Review

Inside Business

Mike Watkins, Head of Retailer & Business Insight at Nielsen, kicked proceedings off with a fast-paced, insight-packed rattle through the latest trends in convenience retailing before Scott Cooper, Sales Director at Tayto, offered a look inside the business and in particular the Golden Wonder brand that has a starting affinity with Scotland. Trystan Farnworth, Sustainability Director at Britvic, then offered details of his company’s huge commitment to sustainability issues and how he believes this will impact upon both retailers and consumers in the near future. Steve Leach, Sales Director at Nisa Retail then delivered a presentation on how Nisa is tackling the ‘next generation’ challenge before United Wholesale Scotland MD Chris Gallacher gave attendees a fascinating view inside the company’s ‘depot of the future’ – a highly tech-enabled depot that is redefining what a cash and carry looks like these days. Jenny Blogg, Retail Director of Camelot UK, then looked back at the first 25 years of the National Lottery under Camelot, and a look forward to the future. Michael McDougall, Licensing Solicitor at TLT concluded the morning session with a look at the impacts so far of Minimum Unit Pricing. The star turn, of course, was First Minister Nicola Sturgeon who reaffirmed her Government’s commitment to the Scottish local retailing sector. She also took many of the audience by surprise by announcing that business rates would not be levied on DRS machines, a welcome announcement for all in attendance. The Conference is regaining much of the lustre of its former years and, judging by the attendance, more retailers than ever have positively re-engaged with SGF, which can only be a good thing for this vital sector.

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Hotlines

Product News & Media Watch

Jambalaya Tilda The rice brand’s latest ready-toheat limited-edition is available now in cases of 6 x 250g packs with an RSP of £1.59. Jambalaya is vegetarian- and vegan-friendly, gluten-free and contains no artificial colours, preservatives or flavourings. It combines celery, onions, bell peppers, long grain rice and spices, and can be prepared in as little as two minutes. For further information visit Tilda.com or call 01708 717777.

Protein Brunch Bars Mondelez Cadbury has strengthened its Brunch Bar range with two new protein-packed products – Cranberry and Nuts Protein and Peanut Protein. Both are available now in multipacks of 5 x 32g bars (RSP £2, outers of 6). For further enquiries, retailers can telephone Mondelez on 0870 600 0699, email retailer.services@mdlz. com or visit deliciousdisplay.co.uk.

‘Cook in Box’ burgers Kepak Kepak’s new ‘Cook in Box’ format that lets consumers heat fully assembled burgers without having to open the pack first. Two Rustlers products are available in the new format: the All-Day Breakfast Double Sausage Muffin and the Classic Cheeseburger. Both RSP at £2.50. The range has launched in selected Co-op, Nisa and One Stop stores; it will roll out nationwide later.

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Life is sweet as Barr dusts off old recipe Barr Soft Drinks has unveiled limited edition ‘Irn-Bru 1901’, a new tipple made from an ‘old and unimproved’ Irn-Bru recipe pulled from a handwritten book that has been gathering dust in the company’s archives for over 100 years. While Irn-Bru’s secret flavour essence remains unchanged, the 1901 recipe doesn’t have any caffeine, but it does have a frothy head on its gingery fizz and is sweetened with sugar. Robin Barr, who unearthed the recipe, said: “The 1901 recipe has aged beautifully over the last 118 years. For a limited time, we’ll be producing a premium ‘old and unimproved’ IrnBru 1901 just as it was enjoyed by our first fans. “This is Irn-Bru as you’ve never tasted it. It’s a chance to enjoy a unique and authentic piece of Scottish history – but don’t hang about, we don’t think it will be around for long.” Taking cues directly from the 1901 bottle, the new packaging features the Irn-Bru strongman and authentication from inventor Andrew Greig Barr in homage to its Victorian-era advertising. Irn-Bru 1901 will be sold in 75cl glass bottles in shops across Scotland from 2 December 2019 and is expected to retail at around £2 per bottle. For trade enquiries, retailers should call 01204 664 295.

Cadbury Mini Bars Mondelez Dairy Milk Mini Bars are now available as 18g singles (RSP 35p) in counter-top units of 42. Pouches of eight individually wrapped bars are also available (144g, RSP £2.49) in cases of six. The 96 calorie format was launched in response to consumer demand for healthier choices. To find out more, call Mondelez on 0870 600 0699, email retailer.services@mdlz. com or visit deliciousdisplay.co.uk.

Millions Mineral Water Golden Casket This new sugar-free still flavoured water is based on Golden Casket’s Millions tiny chewy sweets. The result of a “huge research investment,” the new mineral water will launch this month. It will be available in outers of 12 x 500ml PET bottles (RSP 39p) in three flavours: Strawberry; Bubblegum; and Apple & Blackcurrant. To stock email either nadia@nqcandy.com or debbie@nqcandy. com.

Crimbo Juice Barr Soft Drinks Available in outers of 12 x 500ml and 6 x 2-litre plain and price-marked packs (99p and £1.39 respectively) in Scotland only, Irn-Bru Crimbo Juice offers a ‘Spiced Ginger’ festive flavour – regular Irn-Bru with hints of ginger, clove and cinnamon. The launch is supported with a consumer PR and social media programme. POS kits are available. For trade enquiries, retailers should call 01204 664 295.

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Product News & Media Watch Barista Coffee Co Frieslandcampina

Haribo Advent Calendar Haribo

This new on-the-go cold coffee drink launches in two flavours – Caffe Latte and Caramel Latte – with plans for more variants before the end of the year. Exclusive to the wholesale and convenience channels, both flavours are available in outers of 12 x 250ml cans with an RSP of £1. To find out more call 1403 273273, email hello@ frieslandcampina. com or visit frieslandcampina. com.

Cupcake cases Dr. Oetker

The Haribo advent calendar (300g, RSP £5, outers of 13) offers an alternative to chocolate with a selection of sweets from around the world. It features Maoam Bloxx and Pinballs alongside Tropifrutti and Goldbears. Themed gums and jellies include Winterland and Merry Christmas Mix. For stock enquiries, retailers can call Haribo on 01977 600266, email salesuk@haribo. com or visit haribo. com.

Reign Total Body Fuel Coca-Cola

Unicorn Baking Cases and Dinosaur Baking Cases (50 cases, RSP £1.35, 6 units per case) tie in with Dr. Oetker’s current range of kids’ baking products and Rainbow Cupcake Cases (72 cases, RSP £1.79, 6 units per case) are designed for bakers who want to add brightness to their cupcakes or pick and choose colours. For more information, call 0113 823 1400 or visit oetker. co.uk.

Designed to be consumed pre- and post-workout, this new performance energy drink from Monster Energy is available in four flavoured variants – Melon Mania, Razzle Berry, Lemon Hdz and Sour Apple – in outers of 12 x 500ml cans (plain and price-marked at £1.49). The launch is supported by digital content and in-store POS. For more information, call 0808 1 000 000 or email connect@ ccep.com.

MEDIAwatch

Hotlines



Tetley gets pets talking The well-known tea brand has launched a £3m marketing campaign to “get the nation talking over a tasty cup of Tetley”. It centres around a TV ad featuring some light-hearted banter between a cat and dog as they relax with a cup of tea. The ad is supported by video-on-demand, social media, digital and in-depot activity.

Get out more with Nature Valley Cereal bar brand Nature Valley is back on TV screens with a 30-second ad that highlights the snack as “the perfect accompaniment for an outdoor adventure”. Part of the brand’s new £1.5m ‘Get Out More’ campaign, the TV ad is supported with video-on-demand, radio and Spotify advertising, social content and in-store marketing activity.

Is it a bird? Is it a plane? Kingsmill is supporting its 50/50 Vitamin Boost loaf with two new ads showcasing it as the ‘Bread With Super Baked In’ and highlighting the seven vitamins and minerals in every slice. The ads feature a caped slice of toast who, like every good superhero, has mastered the art of unpowered flight. The £2m campaign runs across TV and digital.

Squidgy adventure anyone? Disposable Vaping Pod Vape Dinner Lady

Lambert & Butler RYO Imperial Tobacco

This disposable e-cigarette is prefilled with Vape Dinner Lady e-liquid and pre-charged, and ready to vape straight out of the box. Available in three flavours – Lemon Tart, Blue Menthol and Smooth Tobacco – each device (RSP £5.99, cases of 10 single flavour) is approximately equivalent to a pack of 20 cigarettes. To stock email fmcgsales@ vapedinnerlady.com or phone 01254 972 041.

Imperial Tobacco has launched new Lambert & Butler Rolling Tobacco, the first in the brand’s 181-year history. It is available now in both 30g and 50g formats, priced at £11 RSP and £18 RSP respectively. The new blend offers reduced moisture levels to make it easier to roll.

Soreen has launched a new national marketing campaign, which aims to drive awareness of the malt loaf brand’s energy and nutritional credentials. ‘Deliciously Squidgy Adventures’ is targeted at a wide variety of ages and includes YouTube ads, videoon-demand and a variety of out-of-home advertising activity.

Butterkist gets things popping Butterkist is back on TV screens and billboards in a £2m bid to drive sales during the final quarter of the year, a crunch period for Big Night In occasions. A TV advert features animated corn kernels shaping their destiny to become Butterkist popcorn. It is supported by out-of-home advertising with the strapline ‘get things popping’.

for all the latest product news, head to www.slrmag.co.uk/category/product-news/ www.slrmag.co.uk

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GroceryAid is the trading name of the National Grocers Benevolent Fund. A registered Charity Reg. No 1095897 (England & Wales) & SC039255 (Scotland). A company limited by guarantee, registered in England & Wales no 04620683

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Fascia Focus

Feature

CHOOSING THE RIGHT PARTNER FOR GROWTH There’s never been a more urgent need for all of Scotland’s local retailers to ensure that they have the right partners behind them to deliver the profits and growth they need to ensure a bright future in a tough market.

et’s be honest: running a profitable local retailing outlet has never been more difficult. The minimum wage adds thousands to the overhead every year, the cost of utilities is rising, sales in traditionally key categories are being routinely squeezed with new legislation, margins are falling across the board – we could go on. Finding new ways of reducing costs and driving up footfall, sales and profits has never been more pressing and has never been more challenging. Evolving your business to embrace vital trends like coffee, food-to-go, fresh and chilled and such like is one way that retailers can drive bigger margin sales, but possibly the most effective quick fix that any store can implement is by joining a symbol group to gain access to the huge array of benefits that they can bring. Or, if you are already part of a symbol group, perhaps it’s time to consider if a different one might be more appropriate for your model? 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 www.slrmag.co.uk

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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 symbol group offers all the benefits of being part of a nationwide collective of like-minded retailers with access to big buying power and the many invaluable support mechanisms that membership brings. The number of stores that now belong to one symbol group or another is fast approaching the 50% mark today, and that’s for a reason. 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 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. The pros for retailers considering joining or switching symbol groups are numerous and the cons are few. 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, do your research before determining which group is right for you – then when you do commit, make sure you commit fully to give your refreshed business the best possible chance of building longterm sustainable growth. NOVEMBER 2019 | SLR

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Fascia Guide

Feature

THERE’S NEVER BEEN A BETTER TIME TO JOIN NISA

With multi award-winning stores including Ardeer Services, Greens of Markinch, Pinkie Farm and Giacopazzi’s Milnathort, to name a few, Nisa is the proven partner of choice for many market-leading, independently minded retailers in Scotland.

ith a current offer that sees retailers able to join Nisa with no membership fee and then get rewarded with £2,000 if open and trading before the end of the year, there has never been a better time to join the group. Nisa was acquired by the Co-op last May. The new structure brings enhanced buying capability, allowing Nisa partners to trade their businesses in the way they choose, backed by competitive prices and promotions. Retailers have the option to operate under a symbol fascia; Nisa Local or Nisa Extra, or dual branded, whereby a Nisa partner can maintain their own local identity whilst also benefiting from the strength of the Nisa brand. Alternatively, a retailer can choose to trade under their own independent fascia. Through its latest Evolution store format, Nisa offers ﬂexibility to retailers with a more modular development format which

accommodates the individual demographic and shopping missions of each store. The Evolution format has seen great success, with retailers on average achieving a 12 per cent uplift in sales since conversion. Nisa provides a complete retail support package which comprises a strong retail focused team, an enhanced category management system, a bespoke staff training facility and a comprehensive marketing package. Nisa’s ﬂexible model provides its retailers with an unbeatable breadth of range of more than 13,000 SKUs. This includes access to in excess of 2,000 Co-op own brand products. Nisa’s award winning own label range, Heritage, is also available, providing even more choice. 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.

A strong focus on availability for the past 12 months has given the best service to Nisa partners for more than five years, generating an additional £40million in annualised sales. With its own insight team Nisa is able to help retailers truly understand their customers and their marketplace, enabling them to modify their offer to match the ‘local’ demographic. Retailers can then use this in conjunction with Nisa’s category management service to create bespoke planograms, layouts and propositions within their individual sites. A comprehensive support structure is provided to ensure retailers continue to push their business forward. Finally, Nisa recognises the importance of community involvement, and as such its retailers can support good causes in their local area through Nisa’s Making a Difference Locally charity, which has donated more than £8.8 million to charities and good causes throughout the UK since 2008.

TO JOIN NISA COMPLETE THE FORM ON WWW.JOIN-NISA.CO.UK/CONTACT-US OR CONTACT OUR DEVELOPMENT TEAM ON 0800 542 7490 46

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www.slrmag.co.uk

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Working with Nisa enables us to compete at a higher level. Dan Brown, Pinkie Farm, Musselburgh Young Scottish Local Retailer of the Year – SLR Rewards 2019

For even more reasons, visit join-nisa.co.uk #JoinNisa | 0800 542 7490 SLR November 2019.indd 47 17451_NISA_TradePress_Dan Brown advert_2018_A4_AW01.indd 1

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Feature

Tobacco

HELLO DARKNESS, MY OLD FRIEND

Tobacco remains a vitally important category for all local retailers in Scotland and, despite continuing falls in sales is still a key driver of footfall, sales and profits thanks to continued innovation and development by the major players.

t may be in slow decline but tobacco is, by any definition, a key category in convenience and it looks set to remain that way long into the future. In terms of driving footfall, sales and profits the category remains among the most important of any in a typical convenience store. It may be in slow decline but tobacco is, by any definition, a key category in convenience and it looks set to remain that way long into the future. In terms of driving footfall, sales and profits the category remains among the most important of any in a typical c-store. The category may be under relentless pressure from all angles, but it remains almost as resilient as ever – and the major manufacturers continue to invest in supporting Scotland’s retailers with new products and innovation.

to help retailers locate the information they need more quickly and efficiently. By optimising the website, JTI aims to further support retailers in an ever-changing

INNOVATION CONTINUES A good recent example of this is the full relaunch of the JTI Advance retailer website with a fresh new look and a raft of smart new features, including for the first time a ‘chatbot’. Found at JTIAdvance. co.uk the site has been given an overhaul with the retailer in mind, resulting in a substantially enhanced browsing experience. Originally launched in 2014, the site has over 23,000 users and is now fully mobile optimised to ensure retailers can take advantage of the insight offered whether at home, on the go, or in-store. It features both pre- and post- log-in content to ensure key information is more accessible than ever. It also sees the introduction of the JTI Advance Bot, an interactive chatbot designed 50

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looking at how we can improve JTI Advance to ensure it continues to support retailers in staying up-to-date on the latest trends, NPD, industry and legislative information,

accessible in the most efficient way possible. “We’ve worked closely with retailers from the beginning to create a user-friendly site capable of communicating relevant information essential to the category. Our newly improved site has been enhanced to improve the user experience across all devices and extend the level of information available to upskill retailers and their staff.” The website is frequently visited by retailers to access an online tool that enables them to create their own compliant customer-facing price list. JTI has also been instrumental in communicating key legislative changes on the website through publishing information on pertinent industry news including Track & Trace and details on illicit trade.

RYO FOCUS market, both with legislative changes and introductions of new categories, while still including all the important previous features such as the mapping tool, price lists and category information. Adam Perry, Digital Trade Marketing Executive, comments: “We’re constantly

JTI has also given retailers something to get excited about with the recent expansion of its popular American Spirit brand. The range now includes American Spirit Essential Blue rolling tobacco, which comes in a 30g format and a brand-new paper pouch pack, unique to the JTI portfolio. www.slrmag.co.uk

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GET CONNECTED STOCK UP

MAKE SALES

CONNECT & MAKE SALES TODAY For Tobacco Trades Only.

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Feature

Tobacco

The Roll Your Own (RYO) category shows no signs of slowing down, growing 7.6% year-on-year and generating annual sales of £2.7bn [IRI, Jul 2019], making it a must-stock for retailers. Ross Hennessy, Head of Sales at JTI UK, comments: “We’ve responded to the market by introducing a unique offering for loyal customers. American Spirit Essential Blue provides a great opportunity for retailers to profit from this category, especially with the unique paper pouch format which is completely new to the JTI portfolio and the market.” American Spirit Essential Blue has an RSP of £14. Imperial Tobacco is also broadening its RYO offering with the launch of a new Lambert & Butler Roll RYO variant to help retailers take

advantage of the growing value for money trend and rising demand for economy RYO products from trusted cigarette brands. Available in both 30g and 50g formats and priced at £11 RSP and £18.15 RSP respectively, the new Lambert & Butler RYO blend offers premium quality at an economy price point. The unique blend benefits from reduced moisture levels to make it easier to roll. This has proved exceptionally popular with consumers during testing, outperforming competitor brands. The Lambert & Butler brand was first launched in 1838 and brand awareness of Lambert & Butler is at an impressive 51% [HBT, Oct 2019], highlighting the popularity of the range within the UK. Imperial believes brand recognition and quality are of paramount importance for any new tobacco product launches to succeed in today’s plain packaging market environment. While the move into Roll Your Own will be a first for the brand, the high consumer awareness of Lambert & Butler as a trusted, reliable brand, combined with the premium 52

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www.slrmag.co.uk

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VALUE RYO FROM THE FASTEST GROWING CIGARETTE BRAND IN SCOTLAND

3x50g

SIZE OPTION 3 POUCH OUTER FOR A LIMITED TIME ONLY

WE RECOMMEND PRICING COMPETITIVELY AT RRP OR BELOW 2

1 2

IRi Market Place, Volume Share, Total RMC, North Scotland, Central Scotland & Border Regions Combined, over the last 12 months to June 2019 (based on slope calculation). You are free to sell JTI products at whatever price you choose.

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Feature

Tobacco opportunities. He says: “The UK Cigar market is worth around £200m in annual sales and the products within it typically offer three times better profit margins than cigarettes, so it’s absolutely one that is worth getting right.” As the biggest player in the category by a country mile, STG takes its category champion status seriously and with the biggest brand of them all, Signature, it has consciously attempted to lead from the front. “Signature (formerly known as Café Crème) is easily the biggest player in the category and Scotland’s bestselling cigar,” comments Williams. In the independent channel in Scotland, Signature has three of the top four places making it a key must-stock brand. In addition to Signature, STG is also seeing huge success with its Moments Blue brand, something Williams sees continuing: “Moments Blue is the UK’s fastest-growing cigar and second best-selling Miniature cigar. And we also have our Henri Wintermans Half Corona which holds the position as the UK’s favourite Medium to Large cigar.” His advice to local retailers? Stock these three core brands and you’ll be able to meet the needs of each and every one of your cigar customers.

quality product and economy price point, makes this new RYO variant a must stock for retailers. Chris Street, Market Manager UK at Imperial Tobacco, comments: “Demand for value for money is a dominant trend within the Tobacco category. As more consumers seek out the lowest out of pocket spend, we’re seeing an increasing shift away from Factory Made Cigarettes and into Roll Your Own. While offering great value for money is crucial, many consumers making the move into RYO are looking for reassurance on quality by buying products from well-known brands they can trust. With its strong tobacco heritage and brand recognition, Lambert & Butler is well placed to respond to this trend with its new RYO variant.”

So there undoubtedly a profitable opportunity there for local retailers prepared to devote a little time and energy to the category. Alastair Williams, the UK Country Director for Scandinavian Tobacco Group (STG) believes that the category offers retailers some unique

CIGARS Somewhat remarkably, there is one tobacco category that is getting bigger: cigars. IRI data shows that the total UK cigar market is actually in growth by value. It may not be growing by much – just 0.9% – but it’s growth all the same. The Miniatures segment is growing by 4.6% while the Medium/Large segment is up 2.7%. 54

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ADVERTORIAL

HEATED CONVERSATION. WITH THE NEW HEETS PACK LAUNCHING THIS MONTH, WE THOUGHT IT WOULD BE A GREAT TIME TO SPEAK TO RETAILERS ABOUT THE HEATED TOBACCO CATEGORY. This month Shahid Hussain, United Supermarket, Bristol. Q) Tell us your opinion of the tobacco market in recent years A) Well I have noticed less people buying cigarettes from me over the last few years. It used to be one of the main things I sold but not as much anymore. I guess people are quitting or switching to alternatives. Q) What alternatives to cigarettes do you stock? A) I have e-cigs and Vape products and also Heated Tobacco Q) How is Heated Tobacco different from other alternatives like vape products? A) Well at first, I didn’t know much about it and I just thought it was another type of vape. But when I looked into it I realised that it’s tobacco, not liquid. I sell it the same way as cigarettes – it comes in packs of 20 and my regulars come in a couple of times a week to grab a pack. It’s actually helping with footfall.

Q) What advice can you give to other retailers who want to get involved with this new category? A) I’d say just grab some when you’re in the Cash and Carry next time and give it a try. To start selling, I explained what it was to my staff - I used the website (IQOS.com) to help them understand it – it’s simple enough. You can also get more information about heated tobacco at the local Cash & Carry. To find out more log onto iqos.com

uk.iqos.com

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13/11/2019 12:02:30 05/11/2019 16:18

Feature

Christmas Top Up

TOP-UP YOUR PROFITS FOR CHRISTMAS! With Christmas fast approaching, shoppers are increasingly thinking about stocking up for the hectic festive period and that means a great chance for retailers to cash in on top-up shopping in the final few weeks.

hristmas is looming bigger and bigger on the horizon for shoppers and that means fresh new opportunities for retailers to cash in on top-up shopping as the big day approaches. Many organised customers will no doubt already have begun preparing for the busy festive period, stocking up on all those key products that make Christmas and New Year get-togethers so special – but there will always be things that they forgot, or things that they had already bought but have been tempted to tuck into early. For retailers, that means ensuring the basics are all in place over the vital next month or so: full availability in key categories and a good range of well-merchandised, easy to find products that will drive footfall, sales and profits this festive period.

IRN-BRU 1901 It wouldn’t be Christmas without some IrnBru NPD and the company has unveiled two new lines for the festive period. The launch of Crimbo Juice aside, Irn-Bru fans across Scotland are in for a treat as limited-edition ‘Irn-Bru 1901’ hits shelves. The top-end tipple is made to an ‘old and unimproved’ Irn-Bru recipe first used when Bru was born in 1901. Faithful to an authentic recipe from a handwritten book stored deep in the company archives for over 100 years, Irn-Bru 1901 contains that same famous flavour essence but doesn’t have any caffeine. It will also only be available in glass bottles – just as it was back in the day. Robin Barr, who unearthed the recipe, said: “The 1901 recipe has aged beautifully over the last 118 years. For a limited time, we’ll be producing a premium ‘old and unimproved’ Irn-Bru 1901 just as it was enjoyed by our first fans. “This is Irn-Bru as you’ve never tasted it. It’s a chance to enjoy a unique and authentic piece of Scottish history – but don’t hang about, we don’t think it will be around for long.” The new line will be sold in 75cl glass bottles in shops across Scotland from 2 December with an RSP of £2 per bottle.

SOFT OPTIONS One of the most important categories of all at Christmas is soft drinks and the major manufacturers have all been busy launching festive packs and new products that will drive sales this year. Note that soft drinks generate double the value of spirits and seven times that of Christmas cakes over the festive period [IRI 2018], further highlighting the importance that retailers should place on the category. The key to optimising profits, says Barr Soft Drinks, is to stock up on bestselling soft drinks brands and make the most of impactful seasonal POS. “Soft drinks are increasingly important to retailers in the run up to and during Christmas, showing continuous year-on-year growth for the last three years and adding a huge £150m to the category [IRI, Christmas 2018],” says Adrian Troy, Marketing Director at Barr Soft Drinks. Shoppers are typically willing to spend more over the festive period as a treat, with over a third preferring to shop brands and premium adult drinks, so there is an opportunity to increase sales by widening the choice available to shoppers. 56

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“It’s crucial to get your range right and stock up on those bestselling brands that shoppers will be looking for, in both multipack and larger pack formats, to cater to those preparing for family get-togethers and parties,” adds Troy. Barr Soft Drinks offers a wide-ranging portfolio of different ﬂavours and pack formats, meaning there’s something to meet

the needs of a range of consumers, including the number one Scottish grocery brand IrnBru [Kantar, Sep 2019], the Barr Family Range and Bundaberg, a Australian range of craftbrewed, premium non-alcoholic beverages.

CRIMBO JUICE Besides Irn-Bru 1901 (see panel), also new this Christmas is Irn-Bru Crimbo Juice, a www.slrmag.co.uk

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Feature

Christmas Top Up

SNACK LIKE A PRO Walkers’ top tips to help boost your festive snacking sales: Q Concentrate your range to on better selling flavours Q Place best sellers in prime locations on the fixture Q Up-weight space of sharing bags Q Focus on the best-selling products Q Group crisps and snacks separately Q Position premium & Better for You ranges at top of your fixtures Q Aim for tortilla and tubes to be placed next to each other Q Place value snacks on base shelves

limited-edition flavour available in 500ml and 2-ltr plain and PMP packs in Scotland only. The ‘Spiced Ginger’ festive flavour features regular Irn-Bru with warming ginger, clove and cinnamon notes. “Timely NPD of this kind delivers premium value, creates a feelgood factor and opens up profitable new consumption occasions,” says Troy. “In the last year, limited-edition flavours have added almost £190m to the soft drinks category [IRI, Jul 2019] and we are confident that Irn-Bru Crimbo Juice will add excitement to the soft drinks fixture and incremental retailers sales during the festive period.”

COLA, MIXERS AND ADULT For Coca-Cola European Partners, Christmas will be all about colas, mixers and adult soft drinks. Amy Burgess, Senior Trade Communications Manager at CCEP, says: “Christmas is a magical time of year for families and friends to get together and celebrate at home with delicious food and drink. Grocery sales increased over the festive period in 2018 with more people buying soft drinks than the previous five years, highlighting that there is growing opportunity for retailers to tap into the Christmas spirit and boost their sales.” Burgess believes cola, mixers and adult soft drinks offer a huge opportunity as they perform particularly well on the lead up to Christmas. “Cola was the largest contributor to soft drinks growth in Christmas 2018, adding £34m in value. Sales of the Coca-Cola brand grew by 14% during Christmas 2018, delivering more than double the sales of the nearest branded cola competitor. “This year Coca-Cola will once again be helping drive excitement with festive on-pack graphics featuring the iconic image of the Sunbloom Father Christmas enjoying a bottle of Coca-Cola. These will run across large PET bottles and multi-packs of cans which are perfect for the at home sharing occasion. “The festive packs will be supported by a multi-million-pound consumer marketing campaign that includes advertising, experiential, digital and PR and of course the return of Coca-Cola’s iconic ‘Holidays are Coming’ advert.”

favourite mixed drinks at home. Schweppes continues to be the nation’s favourite mixer brand. With this in mind, Schweppes Tonic and Schweppes Slimline Tonic 1-litre PET bottles should be considered as must-stocks on the lead up to Christmas alongside alcohol ranges. “With one in five consumers now saying they don’t drink alcohol, and half of those that do are making an effort to cut down, Adult Soft Drinks are a must, especially during the Christmas period,” says Burgess. “Appletiser helps retailers to offer a sophisticated alternative to alcohol that the growing number of teetotal consumers are happy to drink while others may be enjoying beer, wine or cocktails over the festive period.” Burgess also highlights a growing trend among consumers to experiment with new variants of their favourite soft drinks. “It is increasingly important to keep an eye out for the latest flavour innovations across a range of different soft drinks formats over the Christmas period,” she says. “Our Light Cola flavours have also proven extremely popular, and earlier this year we expanded our range further with the launch of two new flavours – Coca-Cola zero sugar Raspberry and Diet Coke Twisted Strawberry, which are now worth £7m.”

SNACKING SALES Another key category at Christmas is snacking with savoury snacks in particular growing by an impressive 6% over the last year and the sharing segment in particular is booming with double digit growth of 12%. Will Kerr, Head of Impulse Category at PepsiCo, says: “As the nation’s favourite crisp brand it’s important that we at Walkers don’t stand still. With insight-driven NPD, we’re tapping into consumer demand to drive long-term savoury snacks category growth and expand our portfolio of popular brands.

MIXERS & ADULT SOFT DRINKS In addition to cola, consumers are also looking for ‘special’ drinks that capture the excitement of the holiday season like cocktails and non-alcoholic mocktails. Mixers grew by more than a fifth last Christmas as more people looked to recreate their 58

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Christmas Top Up

Feature

“As a business, we remain agile and Nick Day, Brand Manager, at PepsiCo, responsive, a great example of this was comments: ‘‘The return of the Walkers the launch of Walkers Max Strong, the top Christmas flavours comes in response to the innovation of 2018 in the savoury snacks buzz and talkability generated last year, and category , a product developed in response to the huge demand from consumers. This the rise in sharing occasions and to answer the year, we are also excited to launch two new £1 demand for a perfect snack to complement a PMPs in our most popular festive flavours. pint of beer.” We hope to spread the festivity and continue While Walkers’ range of family favourites to invite customers to decide whether they’re maintain their popularity, shoppers are a #SproutLover or #SproutHater.” getting more adventurous, looking for bold Finally, Walkers is also launching its and exciting flavours when choosing snacks. biggest-ever festive on-pack promotion and Kerr comments: “Off the back of insights marketing campaign with global superstar such as 45% of UK shoppers are likely to Mariah Carey, who is the perfect Christmas experiment with new flavours, we have icon to be the face of the brand. expanded our offering across Doritos, This festive season marks 25 years after Sensations and more. The popularity of the the first release of her song All I Want BBQ Pulled Pork and Spicy For Christmas and therefore Sriracha flavours in the Walkers it couldn’t be a better time to core range has also demonstrated launch the partnership with her, the rewards of listening to as well as the new packs. consumers, retailers and the Carey will be centre stage wider market trends.” in the new Walkers Christmas Due to popular demand, TV advert for 2019 and the onWalkers is also bringing back its pack promotion will run across Christmas dinner flavours that the nation fell the Walkers core range, giving shoppers the in love with last year. New for 2019, £1 PMP chance to win prizes every hour. formats join the line-up, available in two of SWEET THINGS the nation’s favourite festive flavours: Pigs in IRN-BRU Energy has Confectionery, of course, is another category Blankets and Turkey & Stuffing. outperformed its closest Christmas is the biggest sales opportunity that delivers for retailers at Christmas. Levi competitors since launching in July, establishing itself as the Boorer, Customer Development Director of the year, particularly for the savoury snacks year’s fastest selling soft drink in at Ferrero, comments: “Christmas is a key category, worth £645m and growing at 6.5% convenience*1 with 70% who tried seasonal trading spike for the confectionery year on year. Therefore, it’s important for the product purchasing it more category, and it’s important that retailers retailers to fill the shelves with the best-selling than once and 80% saying they stock the right range of quality products to festive favourites of 2018 from the category intend to buy it again.*2 cover every shopper’s needs. That’s why leading brand. The return of this range means Consumers are increasingly we are providing customers with the right they can continue to bring some festive magic opting for flavoured variants support for them to grow their sales through to retailers’ sales this Christmas. when choosing an energy drink Everyone loves a Christmas dinner, so a winning core range and exciting new and IRN-BRU Energy offers an products reinforced by a £6.8m investment the flavours will continue to spark debate exciting additional choice. Available in sugar and no in consumer support.” surrounding that most contentious of festive sugar options, retailers should NPD from the company this year is accompaniments: the Brussels sprout. Two merchandise both variants of new multipacks will be available again this year, extensive once more with a raft of products IRN-BRU Energy next to other under the Thorntons, Ferrero, Raffaello, one for the sprout lovers, and the other, for energy products to offer shopper Kinder and Nutella brands. the sprout haters. choice and drive incremental Boorer advises: “Christmas Christmas dinner for sprout sales. is a critical sales period for lovers includes Brussels Sprouts, retailers and despite a year-onTurkey & Stuffing and Pigs in Sources: year slowdown in performance Blankets, while Christmas dinner *1: IRI Marketplace, Units/store/week – mainstream brands only, w/e 14.07.19, in 2018, spend remained up at for sprout haters includes Glazed Scotland Convenience *2: AG Barr Research. Aug 19 +1.6%, alongside basket size Ham, Turkey & Stuffing and and frequency increases. Food is Cheese & Cranberry.

IRN-BRU ENERGISES SCOTLAND’S SOFT DRINKS MARKET

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Feature

Christmas Top Up

an important part of Christmas Mr Kipling will be launching Day, with quality taking centre a Mini Mince Pie Selection pack stage, so retailers should focus to add more variety to the lineon stocking a good range of the up. The pack features nine mini bestselling brands that shoppers mince pies, containing three each will be looking out for. Twentyof: Mr Kipling Deep Filled Mince nine per cent of shoppers are Pies, Iced Topped Mince Pies willing to spend more money on and, a new addition especially for chocolates to get better quality the selection pack, Frangipane for the occasion. The pursuit for Mince Pies. quality is reflected in the overall Following the success of Stem performance of the confectionery Ginger Slices and Candy Cane FERRERO MUST-STOCKS category too, which grew +4%, Slices last Christmas, Mr Kipling Ferrero’s top five selling lines last driven largely by branded is bringing both products back Christmas were…. products at +2.6%.” with the addition of Mince Pie Q Rocher T24 (300g) = £2.8m In practice this means promoting a range of advent Flavour Slices and Reindeer Q Rocher T16 (200g) = £2.3m calendars throughout November to capitalise on demand Slices. The Mr Kipling Mince Q Collection T15 (172g) = £1.9m for those items being very time sensitive leading into Pie Flavour Slices transform the Q Classic Collection (248g) = £1.7m December. November is also an important time to drive tastes of the classic mince pie, Q Kinder Joy = £1.5m sales of stocking fillers – everything from selection packs a Christmas favourite, into an to novelty figures and shapes. Retailers should start to easy-to-eat slice format while promote stocking fillers from mid-November through the Reindeer Slices provide a until the end of December to take advantage of when seasonal combination of chocolate and caramel flavours. purchases are at their highest. Lastly, Ferrero advises retailers to start In addition to the new Slices SKUs, Mr Kipling is launching two promoting larger, premium boxed chocolates in December to make new small cakes that deliver strong festive flavours, Chocolate Orange the most of those shoppers looking for the perfect gift. Whirls and Irish Crème Fancies. Chocolate Orange Whirls bring a festive favourite into a new format, whilst Irish Crème Fancies look to CAKE MIX drive penetration amongst new shoppers and give adults the perfect What would Christmas be without cake? Premier Foods is extending Christmas treat. its festive cake range with delicious seasonal additions from its Mr Cadbury is introducing two new Mini Roll flavours – Kipling and Cadbury brands. The new products will be Caramel and Orange – with seasonal packaging to joining the line-up of popular SKUs to help drive excitement over Christmas. Having retailers capitalise throughout been the most popular flavours during the Christmas period. The variety testing, the products are set to drive of flavours and formats make it penetration and bring incremental the ideal selection for friends and growth to the category. Premier Foods family of all ages. is also launching festive Cadbury Caramel Cakes, capitalising on the popularity of Cadbury Caramel – which is worth £60m RSV – using a popular format and helping to increase retailers’ sales at Christmas further. Chocolate is a leading flavour over the Christmas period, and the new Cadbury cake products sit alongside returning favourites to cater to a wide range of occasions and needs. The returning range has undergone a packaging refresh in line with the confectionary redesign to maximise the brand standout in store. 60

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UTC

THE LYNX EFFECT HITS THE ROAD If you’ve ever seen any of those Lynx adverts where hapless young men end up getting chased down the street by hordes of scantily clad attractive young women thanks to the alluring appeal of their choice of deodorant, you’ll have a fair idea of what life is like for the long-suffering lady magnet that is UTC. A loyal fan of Lynx Africa, the auld boy swears by it as it not only manages to just about drown out the odour of rolling tobacco, stale whisky and congealed chip fat, it also ensures that he’s the hottest octogenarian in the room at the Mecca Bingo Hall every week when he picks Mrs UTC up after she’s blown that week’s housekeeping. The launch of a Lynx car air freshener, however, has opened up some brand-new horizons for the auld boy. His 1973 Ford Escort has apparently never smelt so good.

SHOPLIFTING THROUGH THE ROOF Thank you to a keen UTC reader who alerted the old boy to the case of enterprising shoplifter Kristina Perkins of Florida who had a novel idea for escaping arrest after her latest bout of light-fingered criminal activity. The resourceful Perkins, 37, allegedly climbed into the roof of a Big Lots store by removing some tiles in the ‘rest rooms’ so she could get into the ceiling space. Somewhat bizarrely, it took the (presumably heavily armed) police an astonishing five hours to get the perp out of the roofspace before she was promptly huckled on charges of criminal mischief, petty theft and resisting law enforcement. God loves a trier. 62

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IT’S MEAT JIM, BUT NOT AS WE KNOW IT While UTC admittedly has a tough time getting to grips with the whole vegan thing, he nevertheless still has a deep and heartfelt interest in all things environmental. Or so he keeps telling us. So he was fascinated and slightly bafﬂed by a strange press release from a company called Aleph Farms that claims to have successfully grown a steak in space. Or something along those lines. The experiment took place on the International Space Station and was “the first slaughter-free meat experiment in space”. Getting slaughtered is a thing of the past for the auld boy so this was right up his street. Apparently, Aleph “grows cultivated beef steaks” and has a mission to “to provide sustainable food security on earth, and beyond, by producing meat regardless to availability of land and local water resources”. Keeping up so far? So the company has just managed to “produce meat” in space by “mimicking a natural process of muscle-tissue regeneration

occurring inside the cow’s body, but under controlled conditions”. In other words, it has ‘bioprinted’ muscle tissue which could, allegedly, be the first step towards “sustainable food production methods that don’t exacerbate land waste, water waste, and pollution.” UTC apologises in advance for the fact that reading this article has taken a minute of your life that you’re not getting back. But remember where you read it first when Gregg’s launches its first bioprinted steak slice. Which cannae be any worse than its veggie sausage rolls, to be fair. www.slrmag.co.uk

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