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How convenience store retailers are managing foodservice
How convenience store retailers are managing foodservice
How convenience store retailers are managing foodservice
How convenience store retailers are managing foodservice
How convenience store retailers are managing foodservice
How convenience store retailers are managing foodservice
How convenience store retailers are managing foodservice
How convenience store retailers are managing foodservice
How convenience store retailers are managing foodservice
How convenience store retailers are managing foodservice
How convenience store retailers are managing foodservice
How convenience store retailers are managing foodservice
How convenience store retailers are managing foodservice
How convenience store retailers are managing foodservice
How convenience store retailers are managing foodservice
How convenience store retailers are managing foodservice
How convenience store retailers are managing foodservice
How convenience store retailers are managing foodservice
How convenience store retailers are managing foodservice
How convenience store retailers are managing foodservice
How convenience store retailers are managing foodservice
How convenience store retailers are managing foodservice
How convenience store retailers are managing foodservice
How convenience store retailers are managing foodservice
How convenience store retailers are managing foodservice
How convenience store retailers are managing foodservice
How convenience store retailers are managing foodservice
How convenience store retailers are managing foodservice
How convenience store retailers are managing foodservice
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How convenience store retailers are managing foodservice

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  • 1. HOW CONVENIENCE RETAILERS ARE MANAGING FOODSERVICE TODAY June 30, 2010 Presented at: Foodservice Webcast Series Participant Summary 117 South Cook Street #339 Barrington, Illinois 60010 phone: 847.722.2732 fax: 847.382.1801 Copyright © 2010 Balvor LLC. All Rights Reserved. davidbishop@balvor.com
  • 2. Composition of Retailer Respondents (Retailers completed online survey between 5/12/10 and 5/31/10) Number of Stores Operated (Percent of Retailers) 500+ Stores, 3% 201 - 500 Top-Line Characteristics Stores, 6% • # of retailers: 97 11 - 50 • # of store represented: 21,914 Stores, • 1-10 store operator share: 69% 14% • Foodservice sales (APSM): $20,037 • Foodservice sales growth forecast: +2.6% 1- 10 Stores, 69% Q: How many stores do you operate currently? Source: CSD/Balvor Foodservice Survey, Balvor LLC, May 2010. Copyright © 2010 Balvor LLC. All Rights Reserved. 2
  • 3. PERFORMANCE METRICS Copyright © 2010 Balvor LLC. All Rights Reserved.
  • 4. Foodservice Dollar Sales – By Quartile (Average per Store Month*) $38,930 $25,163 $11,366 $7,552 Top Quartile 2nd Quartile 3rd Quartile Bottom Quartile Q: What are your approximate foodservice sales on an average per store day basis? (Includes all dispensed beverage, food prepared on-site, and commissary/packaged sandwiches) *Projected up to monthly figure based on weighted average response. Source: CSD/Balvor Foodservice Survey, Balvor LLC, May 2010. Copyright © 2010 Balvor LLC. All Rights Reserved. 4
  • 5. 2010 Dollar Sales Forecast (Percent Change vs. 2009) Total Foodservice Mean + 2.6% 3.0% 2.9% 2.6% 2.1% 1.7% Cold Dispensed Hot Dispensed Food Prepared On-Site Frozen Dispensed Commissary/Packaged Beverages Beverages Beverages Sandwiches Q: What is your company’s dollar sales’ forecast in 2010 versus last year for each foodservice category? Source: CSD/Balvor Foodservice Survey, Balvor LLC, May 2010. Copyright © 2010 Balvor LLC. All Rights Reserved. 5
  • 6. 2010 Dollar Sales Forecast (Top vs. Bottom Quartile) Total Foodservice* 6.1% Top Quartile + 5.0% Bottom Quartile - 1.2% 3.8% 3.5% 2.9% 2.5% 0.5% -1.0% -1.2% -1.2% -1.8% Food Prepared On-Site Hot Dispensed Cold Dispensed Commissary/Packaged Frozen Dispensed Beverages Beverages Sandwiches Beverages Top Quartile Bottom Quartile Q: What is your company’s dollar sales’ forecast in 2010 versus last year for each foodservice category? *Estimated projection. Source: CSD/Balvor Foodservice Survey, Balvor LLC, May 2010. Copyright © 2010 Balvor LLC. All Rights Reserved. 6
  • 7. SHOPPER PERSPECTIVES Copyright © 2010 Balvor LLC. All Rights Reserved.
  • 8. Demographics – By Quartile (Percent of Retailers Perceiving Increases) 46% 33% 31% 29% 29% 25% 23% 20% 16% 17% 16% 12% 13% 12% 4% Teenagers* Females White Collar Males Moms with Kids** Kids** Top Quartile Mid Quartiles Bottom Quartile Q: How have your demographics been changing over the last 12 months relative to the following shopper segments? *13-19 years old **Under 13 years old Source: CSD/Balvor Foodservice Survey, Balvor LLC, May 2010. Copyright © 2010 Balvor LLC. All Rights Reserved. 8
  • 9. Shopper Interest In Healthier Products – By Quartile (Percent of Retailers Indicating “Yes”) 73% 61% 37% Top Quartile Mid Quartiles Bottom Quartile Q: Are your customers asking for your store(s) to sell healthier product offerings? Source: CSD/Balvor Foodservice Survey, Balvor LLC, May 2010. Copyright © 2010 Balvor LLC. All Rights Reserved. 9
  • 10. GENERAL STRATEGIES Copyright © 2010 Balvor LLC. All Rights Reserved.
  • 11. Strategic Focus – By Quartile (Index) 106 105 105 104 104 104 103 102 101 100 101 99 100 100 100 98 99 98 98 97 97 95 95 94 Lowering product Investing more in Improving in-store Upgrading in-store Expanding the Evaluating supply- Using more Offering more supply costs off-site practices and fixtures & product range side alternatives limited-time-only value-priced deals communications standards equipment offered items Top Quartile Mid Quartiles Bottom Quartile Q: How important are the following strategies in achieving your objectives in 2010? Source: CSD/Balvor Foodservice Survey, Balvor LLC, May 2010. Copyright © 2010 Balvor LLC. All Rights Reserved. 11
  • 12. Core Foodservice Equipment – By Quartile (Percent of Retailers Indicating “Yes”) 79% 75% 73% 69% 69% 67% 67% 65% 64% 64% 59% 50% 39% 33% 30% Hot Cases Fryers Convection Ovens Open Cooler Fixtures Roller Grills Top Quartile Mid Quartiles Bottom Quartile Q: What kind of equipment is driving your foodservice operations these days? Source: CSD/Balvor Foodservice Survey, Balvor LLC, May 2010. Copyright © 2010 Balvor LLC. All Rights Reserved. 12
  • 13. PROMOTIONAL TACTICS Copyright © 2010 Balvor LLC. All Rights Reserved.
  • 14. Off-Site Communication Usage – By Quartile (Percent of Retailers Indicating “More” or “About the Same”) 77% 67% 64% 60% 50% 48% 45% 41% 39% 41% 42% 35% 36% 35% 36% 27% 27% 25% 20% 15% 10% Local event Website Radio spots Newspaper Social media Billboards Text messaging marketing inserts Top Quartile Mid Quartiles Bottom Quartile Q: How are you using off-site communications compared to last year to promote your foodservice offering? Source: CSD/Balvor Foodservice Survey, Balvor LLC, May 2010. Copyright © 2010 Balvor LLC. All Rights Reserved. 14
  • 15. Pump Signage Frequency – By Quartile (Percent of Retailers Indicating “Monthly”) 50% 42% 41% 39% 32% 30% 30% 27% 25% 25% 23% 21% 21% 20% 15% Food Prepared On-Site Commissary/Packaged Cold Dispensed Frozen Dispensed Hot Dispensed Sandwiches Beverages Beverages Beverages Top Quartile Mid Quartiles Bottom Quartile Q: How frequently do you leverage signage at the fuel pump to promote special deals or products available in-store? Source: CSD/Balvor Foodservice Survey, Balvor LLC, May 2010. Copyright © 2010 Balvor LLC. All Rights Reserved. 15
  • 16. New Product Introduction Tactics – By Quartile (Percent of Retailers Indicating “Always”) 73% 58% 50% 50% 36% 36% 33% 27% 23% 15% 6% 0% In-store signage Suggestive selling by store In-store special deal Coupon for discounted or free team item via coupon Top Quartile Mid Quartiles Bottom Quartile Q: How often do you promote a new foodservice product using the following tactics? Source: CSD/Balvor Foodservice Survey, Balvor LLC, May 2010. Copyright © 2010 Balvor LLC. All Rights Reserved. 16
  • 17. Combo Deal Duration – By Quartile (Percent of Retailers) 23% 12% Quarterly 30% Monthly 50% 45% 20% Top Quartile Mid Quartiles Bottom Quartile Q: How frequently do you change foodservice-related combo deals in your store(s), e.g., buy a beverage and a food item and save $$? Source: CSD/Balvor Foodservice Survey, Balvor LLC, May 2010. Copyright © 2010 Balvor LLC. All Rights Reserved. 17
  • 18. Club Programs – By Quartile (Percent of Retailers Offering) 59% 58% 45% 41% 30% 32% 25% 24% 23% 18% 15% 14% 6% 0% 0% Hot Dispensed Cold Dispensed Food Prepared On-Site Frozen Dispensed Commissary/Packaged Beverages Beverages Beverages Sandwiches Top Quartile Mid Quartiles Bottom Quartile Q: Do you offer a club program in any of the following categories, e.g., buy 5 and get your 6 th free? Source: CSD/Balvor Foodservice Survey, Balvor LLC, May 2010. Copyright © 2010 Balvor LLC. All Rights Reserved. 18
  • 19. ASSORTMENT TACTICS Copyright © 2010 Balvor LLC. All Rights Reserved.
  • 20. Commissary / Packaged Sandwiches – By Quartile (Percent of Retailers Offering Products in Store) 95% 97% 91% 91% 84% 85% 82% 82% 77% 74% 74% 47% Sandwiches Salads & Sides Thaw, Heat & Eat Ready to Eat Top Quartile Mid Quartiles Bottom Quartile Q: In Commissary/Packaged Sandwiches, what is the dominant branding strategy associated with your core offering in each sub-category? Source: CSD/Balvor Foodservice Survey, Balvor LLC, May 2010. Copyright © 2010 Balvor LLC. All Rights Reserved. 20
  • 21. Commissary / Packaged Sandwiches – By Quartile (Branding Strategies Based on Percent of Retailers Offering in Store) Sandwiches Salads & Sides 63% 63% 53% 55% 48% 48% 44% 38% 37% 33% 30% 25% 22% 15% 13% 9% 5% 0% Proprietary/Self National/Manufacturer Wholesaler/Control Proprietary/Self National/Manufacturer Wholesaler/Control Branded Brand Branded Branded Brand Branded Top Quartile Mid Quartiles Bottom Quartile Top Quartile Mid Quartiles Bottom Quartile Q: In Commissary/Packaged Sandwiches, what is the dominant branding strategy associated with your core offering in each sub-category? Source: CSD/Balvor Foodservice Survey, Balvor LLC, May 2010. Copyright © 2010 Balvor LLC. All Rights Reserved. 21
  • 22. Commissary / Packaged Sandwiches – By Quartile (Branding Strategies Based on Percent of Retailers Offering in Store) Thaw, Heat & Eat Ready to Eat 82% 71% 71% 61% 56% 43% 44% 47% 29% 18% 14% 14% 14% 14% 11% 10% 0% 0% Proprietary/Self National/Manufacturer Wholesaler/Control Proprietary/Self National/Manufacturer Wholesaler/Control Branded Brand Branded Branded Brand Branded Top Quartile Mid Quartiles Bottom Quartile Top Quartile Mid Quartiles Bottom Quartile Q: In Commissary/Packaged Sandwiches, what is the dominant branding strategy associated with your core offering in each sub-category? Source: CSD/Balvor Foodservice Survey, Balvor LLC, May 2010. Copyright © 2010 Balvor LLC. All Rights Reserved. 22
  • 23. Food Prepared On-Site – By Quartile (Percent of Retailers Offering Products in Store) 100% 97% 95% 85% 86% 84% 82% 77% 79% 64% 63% 47% Pizza Hot Dogs/Roller Grill Sandwiches/Wraps Bakery Top Quartile Mid Quartiles Bottom Quartile Q: In Food Prepared On-Site, what is the dominant branding strategy associated with your core offering in each sub-category? Source: CSD/Balvor Foodservice Survey, Balvor LLC, May 2010. Copyright © 2010 Balvor LLC. All Rights Reserved. 23
  • 24. Food Prepared On-Site – By Quartile (Branding Strategies Based on Percent of Retailers Offering in Store) Hot Dogs/Roller Grill Sandwiches/Wraps 57% 59% 56% 50% 50% 47% 39% 39% 41% 36% 36% 25% 19% 11% 13% 11% 7% 5% Proprietary/Self National/Manufacturer Wholesaler/Control Proprietary/Self National/Manufacturer Wholesaler/Control Branded Brand Branded Branded Brand Branded Top Quartile Mid Quartiles Bottom Quartile Top Quartile Mid Quartiles Bottom Quartile Q: In Food Prepared On-Site, what is the dominant branding strategy associated with your core offering in each sub-category? Source: CSD/Balvor Foodservice Survey, Balvor LLC, May 2010. Copyright © 2010 Balvor LLC. All Rights Reserved. 24
  • 25. Food Prepared On-Site – By Quartile (Branding Strategies Based on Percent of Retailers Offering in Store) Pizza Bakery 65% 58% 46% 46% 47% 44% 42% 41% 44% 35% 33% 25% 22% 15% 17% 11% 8% 0% Proprietary/Self National/Manufacturer Wholesaler/Control Proprietary/Self National/Manufacturer Wholesaler/Control Branded Brand Branded Branded Brand Branded Top Quartile Mid Quartiles Bottom Quartile Top Quartile Mid Quartiles Bottom Quartile Q: In Food Prepared On-Site, what is the dominant branding strategy associated with your core offering in each sub-category? Source: CSD/Balvor Foodservice Survey, Balvor LLC, May 2010. Copyright © 2010 Balvor LLC. All Rights Reserved. 25
  • 26. Frequency of Limited-Time-Only Items – By Quartile (Percent of Retailer Indicating “Quarterly” or “Monthly”) 55% 52% 52% 45% 42% 36% 32% 32% 30% 27% 27% 21% 16% 16% 16% Food Prepared On-Site Commissary/Packaged Hot Dispensed Cold Dispensed Frozen Dispensed Sandwiches Beverages Beverages Beverages Top Quartile Mid Quartiles Bottom Quartile Q: How frequently do you introduce limited-time-only items onto the menu in the following categories? Source: CSD/Balvor Foodservice Survey, Balvor LLC, May 2010. Copyright © 2010 Balvor LLC. All Rights Reserved. 26
  • 27. Introduction of New, Value-Driven Products (Percent of Retailers Indicating “Yes”) 55% 50% 45% 45% 41% 42% 37% 33% 26% Food Prepared On-Site Hot Dispensed Beverages Commissary/Packaged Sandwiches Top Quartile Mid Quartiles Bottom Quartile Q: Have you introduced any new products in the past 12 months that enable your store(s) to offer lower retail prices? Source: CSD/Balvor Foodservice Survey, Balvor LLC, May 2010. Copyright © 2010 Balvor LLC. All Rights Reserved. 27
  • 28. Putting it all into context (What does this all mean?) • Work continually on improving core products and practices • Expand ways value is delivered to the consumer • Focus on reaching a broader set of your target consumer • Increase visibility of food-related promotions at the fuel pump • Motivate store visits and product trial via special deals • Leverage new products to maintain interests in offering • Drive demand for new products by removing barriers to trial • Remember it takes time, commitment, and resources to become a top performer Copyright © 2010 Balvor LLC. All Rights Reserved. 28
  • 29. David Bishop Managing Partner, Balvor LLC Biography David is the managing partner of Balvor LLC, which is a sales and marketing firm that provides consulting, sales support, research, and P: 847.722.2732 analytic services to retailers, product suppliers, financial analyst and other organizations. davidbishop@balvor.com Balvor’s services support various food channels, covering both foodservice and retail classes of trade. David has helped many leading retailers evaluate new retail concepts, Notable Public Accomplishments enhance annual category planning processes, and develop new White Papers business support methods related to assortment rationalization, space allocations, or branding strategies. • Are Retailers Doing Enough? Preventing Underage Access to Tobacco at Retail, Center for Responsible Tobacco Retailing, Inc., 2009. David leverages his experience to help product suppliers improve their competitive positioning, trade programs, and category management • Accelerating Cigar Profits Through an Increased Strategic Focus, John capabilities by better understanding what retailers’ value while also Middleton Inc., 2008. benchmarking versus peer companies. • How to Succeed in Convenience Retaill:A Practical Guide for Product He’s also has broad experience with activity-based costing, channel Suppliers, NACS, 2007. sales strategy, merchandising assessments, trade communication, and Industry Research custom analytical support for both consumer packaged goods and • SKU Rationalization Survey, NACS/Balvor, March 2010. foodservice industries. • Motor Fuels Retailer Survey, Balvor/NACS, January 2010. Prior to founding Balvor in 2008, David spent 12 years at Willard Bishop in various positions, including most recently as partner. David began his • State of Foodservice, Convenience Store Decisions, 2008-2010. career with The Levy Restaurants in operations for new store concepts • Private Label Trends in Convenience, NACS, 2008. where he focused on beverage and financial programs. Current Industry Affiliations • Convention and Events Committee, NACS, 2007 - present • Supplier Advisory Board, Convenience Store Decisions, 2006 - present • NACSPAC Member, 2008 - present Copyright © 2010 Balvor LLC. All Rights Reserved. 29

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