Home' FMCG Business : FMCG AUG 2015 Contents FRESH APPROACH
he rapid growth of fresh food as a convenience store
category has been one of the most visible signs of the
ongoing evolution of Australian convenience stores, and
it looks set to continue for a while yet. There are lessons
to be learned from this trend across the Tasman.
Faced with the decline of a number of traditional
categories and a cluster of other trading challenges, stores have
increasingly decided to put fresh food front and centre in their drive to
attract new customers and to make themselves a destination.
In recent years, major groups such as 7-Eleven, Caltex and BP in
Australia have invested a lot of time, money and energy into updating
their food offer, indicating that they see an even brighter future ahead
for the category.
Convenience stores are reacting quickly and effectively to changing
consumer demand. In the past few years, the health and wellness trend
has collided with a surge in awareness of the benefits of fresh food.
In an era in which farmers’ markets are thriving, TV cooking shows
are flourishing, and supermarkets are placing an ever greater emphasis
on the freshness of both their produce and their food offering as a
whole, convenience has responded.
Whether it be fresh fruit, wraps, sandwiches, or even premium
sausage rolls and pies, convenience retailers are intensely aware that
today’s customer is demanding the highest standards of product and
presentation. The image of convenience stores offering little in the way of
food other than perhaps a cheap pie have been swept away in Australia
by well-maintained bakery-style food areas, and a strong focus on quality.
Leading business-to-business market research company, The
Advantage Group, says fresh food is the number one category for
shoppers wanting quality, and the number one category for shoppers
who are browsing for a healthy diet. Interestingly, it says convenience
shoppers only rate the range currently available as ‘average’, suggesting
there is room for further improvement and further growth.
While some convenience stores and particularly small supermarkets
have enjoyed success selling fresh fruit to snack-seeking customers and
have even developed their own relationships with local growers, much
of the attention has been focussed on the food to go area.
Convenience stores are a natural fit with on-the-go consumers who
may have been too busy to have a proper breakfast or to sit down for
lunch, and who don’t want to take time out to seek out a supermarket.
Supply chain challenges
Much has been made in the past of the fresh food supply chain
challenges that Australia faces in comparison to more compact, more
populous countries such as the UK. However, an innovative approach
from suppliers and renewed determination to give customers what
they want from convenience stores is slowly changing the landscape.
While there have been attempts by some smaller operators to make up
sandwiches and rolls on site, the vast majority of bakery-style products in
convenience are frozen before distribution and are then thawed in-store.
From a convenience store operator’s point of view, receiving pre-packed
food has a lot of advantages over producing it themselves. It reduces the
need for intensive staff training and the risks associated with food handling.
The ongoing improvements in the quality and in the range of
the convenience store food offer has led some to believe that they
will increasingly be able to compete to some extent with quick
Above average growth
Recent data from the state of the industry report produced by the
Australasian Association of Convenience Stores (AACS) revealed that the
food on the go category was continuing with its above average growth.
Leading the way was fresh cakes, followed by sandwiches, and hot pastries.
Individual stores need to really understand their customer base and
local demographics as they ponder how to best maximise the opportunity
presented by the growing demand for convenience food. A convenience
store in a CBD location surrounded by offices will need to cater its offer
to a different sort of customer than those in a residential district.
In a category such as food, where freshness is critical and wastage
an issue, retailers will also need to understand the ebb and flow of
demand, and react accordingly. While breakfast time and lunchtime are
obvious high volume periods, the position might be slightly different in
areas where there is, for example, a prevalence of shift workers.
Some forward-thinking stores have been recognising the
opportunity presented by the different demands of customers at
different times of the day. A number of supermarkets have developed
different menus and different signage for certain times of day. For
example, at lunch they might be encouraging shoppers to try wraps,
sandwiches, fruit and drink, while at breakfast they might promote
fruit, yoghurt, cereal and coffee.
The convenience food offer continues its exciting evolution.
44 FMCG BUSINESS - AUGUST 2015
Links Archive FMCG SPT 2015 Navigation Previous Page Next Page