nickshanagher

Making shoppers feel special requires some careful calculation by local retailers as to the value that offers provide to their customers. In a recent Retail Newsagent magazine it suggested that local retailers think about providing loyalty cards to encourage regular coffee purchases, for example a "buy 10 cups and get one free" offer. Is this generous enough for most shoppers to appreciate the value that you are offering them enough so that they change their behaviour? Doing the maths, if the cost of each hot coffee to go is 50p and you sell them for £1, then on a deal where someone buys 10 to get the 11th cup free, the discount is worth 10% to the shopper and it costs you 50p to give this value to him or her (the sales tax does not apply). The impact on your cash profit is that it falls by 14.2% from £3.50 to £3. If you do the offer at "buy six cups and get the seventh free", then the potential cost to you is 23.7% from £2.11 to £1.61. However, you also need to f...

Walkers Max are promoting their grab bags with a 2 for £1 flash in corner shops and I wonder how many retailers have done the maths? My local Best-One is selling these singly at 55p and if he is buying from Bestway he is making a 16p net margin on every bag he sells. However, if he sells two bags together, he makes a net margin of 23p and his profit on return has fallen from 34% to 27.4%. On the Booker web site it lists both the price marked 2 for £1 and the standard 50g products. The recommended retail price for the promotional packs is 57p and for the standard pack is 54p. In the absence of any commentary about possible overriders that are available to local retailers, it does not seem to make much sense to take part in this promotion. Perhaps someone could let me know how it could?