Focus on convenience trading
A Murco case study

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Page 5: Pilot project

Murco first approached SPAR UK Ltd in August 1998 with a view to implementing
a joint forecourt programme at its site in Withybush, South Wales. Murco and SPAR developed the following objectives:-

  1. Murco’s site at Withybush would be developed to trial a modified form - the interceptor store concept
  2. the development of the store would increase retail turnover
  3. estimated Gross Profit would improve
  4. the site would be developed as the main 24-hour convenience store in the area with a strong emphasis on snacks
  5. new concepts such as hot food and scanning would be introduced.

The Withybush site

  • The forecourt and store are situated within a retail park off the main A40 trunk road to Fishguard
  • the site is on the outskirts of Haverfordwest to the north of the main town area at the top of a new ‘relief road’
  • there is limited housing development - the main concentration of residents is to the east of the site around the Cardigan Road in the area known locally as Prendergast
  • the Withybush Hospital has 380 beds for patient care plus an accident and emergency department. The hospital has 1,000 staff and includes a coffee shop, pharmacy and a small gift shop
  • access to the site is via a roundabout which also serves as one of the entrances to the hospital and to the retail shopping area, and all traffic using the retail park has to pass the forecourt both in and out.

A challenge to the success of the project was the extent of retail competition in the area:

  • a local Londis store in Prendergast with an estimated turnover of about £10,000 per week
  • another petrol forecourt store 8 tenths of a mile to the north operating with a 24hr store on site
  • a Kwik Save supermarket directly opposite the forecourt
  • a full size Safeway superstore 1/4 mile to the south
  • a full size Tesco superstore two miles to the west.

The site thus presents a challenge when considering its position on the road, and the proximity of a main foodstore. This together with the‘traffic’ generated by customers to the retail park and adjacent hospital site indicated that the concept of an ‘interceptor’
store would need to be modified. Murco felt better placed to tap into the late night market providing hot food and meal solutions.

Research undertaken

Extensive market research was carried out to find the profit potential of the area and the site location. Detailed calculations were made using published market research data showing:

  • the types of consumers living in the site neighbourhood
  • their typical consumption patterns, i.e. how much they spent on specific types of merchandise.

Armed with this information, the planners were able to forecast a ‘low case’ turnover and a more optimistic ‘best case’ projection. On the basis of the research findings it was agreed that, through offering a comprehensive range of impulse snacks, the site should become the main destination store for many busy working people, i.e. the hospital and the retail park employees, looking for convenience meal solutions and ‘ready-to-eat’ snacks.

To reinforce the new focus of the store the SPAR fascia was advertised boldly on the shop front and two external tower fascias. The new SPAR imagery was installed inside the store to help create both a professional and ‘fresh’ looking store. The shop floor sales area was more than doubled, and the layout of the store was designed so that it invited the customer to walk through the store, creating further impulse purchase opportunities.

A new ceiling, lighting, counter, off licence area, hot food area and a larger dairy cabinet were all included in the refit. Scanning was introduced from day one to enable day-to-day operational reports and data to be produced and to efficiently track the store’s performance.

As the staff are often the first point of contact a customer has within the store, it was agreed a key element to the success of this site was the training and development of its management and staff.

Murco | Focus on convenience trading