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SPORTS NUTRITION:

Create a winning category

SLICE OF SUCCESS Pomme Natural Market Port Coquitlam, B.C.

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DECEMBER 2014

Choosing the right POS system for your store

CONTENTS

46

VOLUME 14 | ISSUE 10

36 “Our aisles are wide and we wanted that open environment to give customers the space to look at products without feeling like they’re being pushed along.”

26 U P F RON T

F E AT U R E S

06 PUBLISHER’S LETTER

26 COVER STORY: SLICE OF SUCCESS

42 INGREDIENT REVIEW: PHASE 2 CARB CONTROLLER

18 STAR WATCH

32 GALLERY: CHFA EAST 2014

46 STRONG BONES

20 SKU REVIEW

36 SEEKING BETTER PERFORMANCE: HOW TO CREATE A WINNING SPORTS NUTRITION SECTION

50 POINT OF SALE SYSTEMS 101

14 INDUSTRY NEWS

By Bonnie Siegler

24 TOP SELLERS

By Kavita Sabharwal

By Mitch Skop

By Stephanie Rubino

By Liza Marley

By Allison Tannis

FIND US ON

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COVER STORY

SLICE SUCCESS Pomme Natural Market uses the expertise of its co-owners to thrive in a challenging marketplace.

BY KAVITA SABHARWAL PHOTOGRAPHY BY KATIE HUISMAN

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Opposite page, clockwise from top-left: Ed Low, Dave Arnsdorf, Rasool Rayani, Craig Hermanson

OF

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Opposite page, clockwise from top-left: Ed Low, Dave Arnsdorf, Rasool Rayani, Craig Hermanson

COVER STORY

raig Hermanson had his sights set on running his own natural health market for quite sometime. Although things did not immediately go his way for his first foray into the natural grocery business, he decided to regroup and come back with a stronger plan.

Hermanson started out with Save on Foods, where he spent 20 years, before he moved to Planet Organic as a store manager for one year. He met Dave Arnsdorf and Ed Low through Rasool Rayani, and they discovered they shared the same vision of starting an organic grocery store with a unique concept.

Although they were initially looking to open the store in Victoria, British Columbia, when a space opened up in Port Coquitlam, the group decided to move forward with it.

Hermanson had worked with the rest of the initial core team,Terrance Morris, Graham Clarke, Heather Prins and Zachary Haigh, at Planet Organic. Once the concept was in the works he recruited them to join the team and with an investment of $3 million, Pomme Natural Market was born.

CATERING TO DEMAND Port Coquitlam, B.C. is a growing region that is home to fewer than 60,000 people, with the largest population group being 45 to 64 years across both genders, according to the City of Port Coquitlam 2013 census. However, the city experienced over $63 million in new construction during 2013, most of which was spent on dwellings, indicating people are putting down more roots in the region. The store space was chosen because it is a growing area that was served by another health store that recently closed, providing a roadblock for customers who want healthier foods.

“As you spread out in this area, there are a lot of opportunities out here because there aren’t a lot of places like us in the area,” says Hermanson, director of operations.

The store’s clients are mostly women ages 20 to 55 of all nationalities, although the store’s concept also attracts people with higher income levels and people with college or university educations.

“Although Port Coquitlam has quite a wide range of people, I think that’s our primary customer,” says Hermanson. The area has a lot of younger families compared to the cheaper housing around the downtown area, according to Clarke, grocery merchandiser.

The owners say the store typically serves an informed clientele, especially in the supplements department, where customers tend to research items beforehand to make informed choices.

“We do get a lot of shoppers that will be in the store for an hour and a half,” says Morris, healthy living merchandiser.“Our aisles are wide and we wanted that open environment to give customers the space to look at products without feeling like they’re being pushed along.”

Hermanson says the company will expand outside of its one 16,000 square-foot location as soon as the opportunity presents itself.

That includes a possible e-commerce presence and growth outside of British Columbia.

“I think for us, anything is on the table as long as it makes sense.

We would have to have a solid foundation here, and the resources and infrastructure in place to be able to run it whatever the location as well,” says Hermanson.

POSITIVE INTERACTIONS The store’s marketing approach involves its strong online presence on social media, where Pomme employs Piko Marketing to regularly post specials, recipes and contests on Facebook and Twitter. It also sends out a monthly e-newsletter that contains relevant articles, recipes, and product features, and has even had two television commercials featuring wellness expert Tammy-Lynn McNabb that aired for one month each on local channels.

“We do a regular flyer and we do a lot of stuff with the community.We’re setting up and launching a program to offer school tours so it’s kind of a two-part program. We have someone go to schools and talk to classes about healthy eating, and schools can also bring classes to the store to see how it works, healthy eating and see behind the scenes as well,” says Hermanson.

Pomme has also held events in partnership with its vendors, donated money to Port Coquitlam Public School and hosted guest speakers who are well known in the natural health industry, including Brad King and Terry Willard.

BEHIND THE SCENES The retailer employs about 65 people – 55 at store level and another 10 in head office. While they look for associates with prior experience, especially for the healthy living department where they will be counseling customers, new employees are often hired if they have a good attitude and can provide exemplary customer service.

Morris says several staff members are from the Canadian School of Natural Nutrition, and one of Pomme’s employees was even an instructor at the school. Since Pomme moved into the vacated space of another retailer, that also allowed them to offer employment to people who previously worked at the old store.

Most store associates take part in ongoing training, since the natural health industry often introduces new products and formulations, providing a lot of new material to learn.

“In Healthy Living, we get training from certain vendors. They do in-store training or breakfast trainings,” says Morris. “We like to have

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[training sessions] at least once a month, depending on the product.

Whenever they launch new products, they do a training session with us.”

The impact of regulations has touched the store in a different way than usual. While Pomme has not lost sales due to the enforcement of the rule that every natural health product must feature a Natural Product Number (NPN) on the label, it has lost products to this rule.

“There are other [products] out there obviously, but if people are die-hard fans of products we’ve lost, then yeah, we’ve lost sales.

Especially with NPN regulations, they have pretty much hurt the industry as a whole,” says Morris.

In addition, the Canadian Food Inspection Agency (CFIA) visits the store regularly to check up on the store’s stock of organic foods.

It also checks labels to ensure rules are upheld.

Clarke notes that the fluctuating Canadian dollar has had an impact on prices, yet not on sales. “We’ve seen at least a 10 per cent increase in cost of product over the last year, and that passes on to the consumer, though we haven’t seen a reduction in basket size,” he says. “For people who choose to eat healthy, unfortunately it can be costly, but we haven’t seen a slump in that way.”

Morris continues, “In supplements, we see the odd product that goes up in price, but that has more to do with the availability of raw products rather than the economy. I try to use Canadian and local products first. We are going to see the market not supporting the demand. Sometimes the trickle effect takes three to six months hitting the consumer side.”

In terms of his Healthy Living department, Morris does not limit the number of vendors allowed in each category. Instead, he bases his shelves on the space available. “I have the department brand blocked. I will always look at new lines or brands, though they do need to fall within our standards for clean products,” he says.

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COVER STORY

“In the end, a product still has to show it can sell. There is no use having an item on the shelf that doesn’t sell. As I tell my vendors, every bottle has to make its rent for shelf space.”

Pomme does not do live inventories at the moment, instead preferring to stick with conventional ordering from the shelf. Since storage is at a premium in the back rooms of the store, the owners choose to keep inventory tight, thereby keeping products fresher.

According to Clarke, nearly every season is the busiest time of year, as sales only really slow down during the summer. Consumers are not looking to purchase heavier food items, instead choosing snacks and lighter foods, as well as pop. Morris agrees, saying Christmas is the busiest time of the year for immune products, while in January, sales tend to balloon due to people going back to the gym and aiming to get in shape.

Hermanson estimates that the deli and kitchen accounts for 15 per cent of total floor space. Produce also takes up that much square footage, while the Healthy Living department accounts for 20 per cent and the Grocery section takes up 40 per cent. The remaining 10 per cent of floor space is used for the tills and customer seating.

“We’re a full-service store that offers everything a conventional retailer would.We don’t cut our own meat but we have a good selection. We have health and beauty aids, grocery, dairy, frozen and bulk.

We also have an eco-store that has eco-friendly products like clothing, water bottles, toys and more,” says Hermanson.

CREATING A UNIQUE IMPRESSION It is rare to find a competitor that employs the same concept as Pomme – while other stores may share some aspects on a larger scale, they may not have an all-natural deli or the same product selection. The eco-store is another unique component offered, along with having a large all-natural organic bulk food section and an aisle exclusively dedicated to gluten-free goods.

“The focus on knowledge in the healthy living department, that makes the difference. Everyone likes to say they have knowledgeable staff. It really comes down to it when you see people there for an hour talking to the staff,” says Clarke. “They’re so much more appreciative and you get that return shopper.”

“There’s one thing our customers can be confident of coming into our store. Everything is either all-natural or organic,” adds Morris.

Morris believes the entire concept of the store, as well as the feelings it evokes, are completely unique. “A lot of the customers and vendors say it’s very inviting and welcoming. Compared to other stores they’ve been to, it’s constantly neat and tidy, and they can find things easily.That’s one thing I hear a lot about our concept and how it looks,” he says. “I like how we’re all organic produce – I’m a big fan of that.The eco department was something I tried for years to bring into [my old workplace] and they wouldn’t go for it, so when Craig approached me and said he wanted that for his store, I was so happy because there’s so much new product coming out on that front.”

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Graham Clarke, grocery merchandiser at Pomme Natural Market

At a Glance

BECOMING A POPULAR DESTINATION The owners are extremely proud of how quickly they managed to open the store.The previous tenant closed its doors in late December, and in less than one month, Pomme managed to stage a soft opening for January 24th of this year.

“Our soft launch went really well.The one thing I would have liked would have been if we were more ready to open, however sometimes you just have to open,” says Hermanson.

“We had customers circling the parking lot and knocking on the door to see if they could get something. People might buy smaller amounts, however they come by regularly,” says Clarke. “There wasn’t another health food location around here.They were literally pounding on the door to get in.”

Morris says the response from vendors was great when they opened their doors, allowing them to jump on board right away. “I liked seeing how fast this took off and how well it has been received by everyone. I really liked our concept, our name, everything,” he says.

“It was good to see the relationships that were built over the last 20 years until now. The manufacturers, distributors and brokers, they really went to bat to get the store open,” adds Clarke. “The support was there and there was no way to do that without them.”

Clarke also notes that at CHFA West in Vancouver, Pomme Natural Market was a successful hit, as everyone brought vendors to meet the team.That confidence in Pomme Natural Market is what is driving the store to a successful present and a promising future.

Name: Pomme Natural Market Owners: Craig Hermanson, Terrance Morris, Graham Clarke, Heather Prins, Rasool Rayani, Dave Arnsdorf and Ed Low Location: 2755 Lougheed Hwy, Port Coquitlam, BC, V3B 5Y9 Website: pommenaturalmarket.com Store size: 16,000 sq. ft.

Staff: 65 Top Selling Products

Food: Santa Cruz Organic Apple Juice 2.84L, Blue Monkey Coconut Water – no pulp 520ml, GT’s Kombucha Gingerade 480ml, Maple Hill Farms and Rabbit River Organic Eggs, Stahlbush Island Farms Blueberries Vitamins: EnerC, Prairie Naturals Vitamin D3, Mega Food Herb Free Baby & Me Supplements: New Roots Wild Oregano C93, New Roots Chill Pills, Prairie Naturals Organic Aqua Greens Personal care products: Soap Works bar soap, Jason PowerSmile Toothpaste, Nature’s Aid Skin Gel (all sizes) Miscellaneous: Nutracleanse, Swell Water Bottles, Santevia Alkaline Filter Stick, organic walnuts (bulk), organic raw almonds (bulk), organic whole cashews (bulk)

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