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Stocking Smart

Carrying products that customers crave can boost sales and loyalty.

No self-respecting c-store retailer wants to be in the dust-busting business. But the truth is that many convenience retailers carry products that go overlooked and ignored by customers and sit unmoved on shelves, counters and displays. That’s why it’s important to stock your store with in-demand items that meet the needs of your neighborhood’s market, say the experts.

David Brewster, president, David Brewster Design, Wadsworth, Ohio, said that most c-stores make the mistake of conforming to the old "80/20 rule," which means that only 20 percent of the things you try to sell will provide 80 percent of your success, and 80 percent of the items you stock will generate only 20 percent of your success.

The more ideal ratio Brewster recommends is devoting:

  • 50 percent of space and SKUs to products that sell best;
  • 20 percent to innovative new products;
  • 20 percent to marginal products (c-store items of limited brand variety, such as engine oil and cat food, that yield marginal sales to shoppers with a more immediate need); and
  • 10 percent to items you believe help move top sellers. These "movers" can include immediate consumables like salty snacks that can be bundled with a sweet beverage or wholesome products that can be bundled with a hot beverage.

"The idea is to reduce the number of fill-in items you carry by stocking only the best-selling items and brands in each category," said Gerald Lewis, an industry expert from the Gerald Lewis Team, in New York City.

You can identify your top sellers by analyzing brand, category and segment trends and scrutinizing sales data. Within your sales reports, Brewster recommends paying particular attention to unit turns: the number of individual SKUs that turn sales. "Imagine, for example, two items—one priced at 10 dollars and one priced at two dollars," he said. "If you sell only one of the former but 20 of the latter, it’s pretty obvious which unit turner you should have more of in your store."

If you do not have access to sales reports, reach out to your wholesaler or manufacturer partner, like Kellogg’s®, who can provide national purchase data in their respective categories. "To garner additional insight, ask your experienced employees what’s ringing up most at the cash register and review video surveillance footage for shopper traffic patterns", Brewster said. This will ensure that you’re carrying the items that will turn the greatest profit for your store.

Consider that 25 percent of salty snack shoppers left a store without making a salty snack purchase when they could not locate the brand they were looking for, and that percentage rises to 33 percent when the product is a brand like Cheez-It®*. To safeguard against disgruntled consumers who will take their business elsewhere, it’s important to consistently stock high-quality selections of what your customers want, said Brewster. This will drive both sales and repeat purchases, as your customers know they can count on your store for the brands they’re looking for.



*Source: Management Science Associates, Inc. and Paradigm Sample and the American Wholesale Marketers Association Salty Snacks Shopper Study, 09/2011

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