Coffee to go with your breakfast roll?

Starbucks provides a cheap place to meet or an expensive place to buy coffee, depending on the shopper's outlook. Aggresively expanding bakers chain Greggs says it plans to increase the number of its outlets selling lattes and cappucinos.

While the media says this is a threat to Starbucks, Greggs appears to be operating in the part of the market where McDonald's is operating and that is its natural competition. What is clear about its strategy is that it is tapping into the same "out of home" food and beverage opportunity that is available to local shops. Greggs says it sold 10 million breakfast rolls last year and 300,000 pots of porridge.

"Convenience is getting more crowded and everyone is our competitor," chief executive Ken McMeikan told independent retailers at an ACS summit earlier this month. Sandwiches and drinks are now 50 per cent of his sales and coffee is the biggest growth opportunity.

His focus is on delivering outstanding service, value for money and to follow the customer (what the shopper wants the shopper gets). It sounds like a strategy most local shops would say they believe in. With plans for 1,480 stores by the year end it should not take you too long to find a nearby Greggs. If you think you can beat it on execution, then give it a go. Don't stand still.

Comments

Three secrets of great merchandising

Look at the ceiling and top wall of this McDonalds restaurant. There is a picture of two good looking healthy people having fun and some bright primary colours. Ask yourself what is the purpose of this picture? In the latest issue of Retail Newsagent in a feature on merchandising, Andrew Knight of RI tells its independent readers that they need to think about using sharp pictures of non-packaged products linked to people consuming goods. Perhaps this has been taken to the next level by the fast food chain - that is selling the feeling of being happy and healthy rather than the products. A second, related tip from the same feature is made by most contributors - it is vital to keep windows clean and clear of clutter. "I believe that less is more," says Roli Ranger, a retailer from Ascot, Berkshire. He has posters for promotions in between the windows that are regularly updated and discreet signs in the windows. Third, a highly visible well-stocked promotion at the entranc

Overcoming a price disadvantage

Planning for his speech at the Independent Achievers Academy last week, Theo Paphitis asked an assistant to buy a basket of six essentials from a Tesco, a Londis (independent operator in a symbol group) and a One Stop (Tesco's CTN/convenience chain). Tesco was cheapest by a big margin. Second came Londis. The most expensive was One Stop. Mr Paphitis understands the power of the supermarkets and he says the way to counter them is to focus on how to make the experience of shopping with you more relevant to shoppers or more enjoyable for them. John Heynan, sales director of Molson Coors, told Retail Newsagent at about the same time that occasional beer buyers will pay 13 per cent more for their beer in an independent convenience store, provided the retailer targets them appropriately. Tesco has carved itself out this 13 per cent head start. Looking at pricing, if Tesco is 100, then Tesco Express is 108, One Stop is 112, a good symbol group is 115 and non-affiliated independents

A sign of retail stress perhaps

It must have been four months since this window was broken in the Tesco Express on Pentonville Road and I simply cannot believe that it has not been fixed. This is the sort of lack of focus that independent shops usually get criticised for. The only purpose in sharing this image is to encourage those independents with high standards who are finding the going tough that they can do better than this.

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