Skip to content
Search
AI Powered
Latest Stories

'Loyalty card schemes making it difficult for c-stores to compete on price'

'Loyalty card schemes making it difficult for c-stores to compete on price'
iStock image
Getty Images

Independent c-stores are aligned to the convenience multiples on base pricing, but deep discount loyalty card promotions are making it increasingly difficult for the indies to compete on price, states new research from TWC, in collaboration with The Federation of Wholesale Distributors (FWD).

Audits conducted by TWC show that prices have increased by +11 per cent in independents, +13 per cent in Tesco Express and +17 per cent in Tesco Supermarkets in January 2023 vs. November 2021 (based on a list of more than 70 products sold in all 3 outlets). The price differential between the independents and Tesco Express has fallen because prices have risen more at the multiples, and at the time of the audit in January 2023, there was price parity between the two.


However, Tesco are using their ‘Clubcard Prices’ within their convenience format to offer discounts of up to 35 per cent, making it hard for independent convenience stores to compete with the multiples on price.

Independent retailers are not resting on their laurels, they are fighting for their share of local trade and pulling a number of levers to do this. Phone interviews with 150 independent and symbol retailers revealed that 93 per cent were trying to offer superior customer service and 89 per cent were supporting local charities and initiatives.

Independents competitive 230323

Many are also trying to compete on price, whether that’s by offering a wider range of cheaper products (78 per cent), more Own Label (65 per cent) or price matching vs. the competition (39 per cent).

Tom Fender, Development Director at TWC said, "We have a hypothesis at TWC that independent retailers believe the PMP is the promoted price. Base pricing in our audit shows that PMPs are working to create a parity on price, however encouraging tactical promotional activity as well could be a big win for the retailers who are not already doing this.”

“Promotions can encourage a number of behaviours – from driving footfall; increasing spend once shoppers are in store; trialing categories they didn’t intend to purchase; and encouraging trade up to better and best tiers.

Tom Fender March 2023 Tom Fender

“Our research evidences who is shopping in the independent convenience channel and it is not necessarily driven by cheapest on display – the shopper is NOT lower affluence and therefore these stores do not need to be the cheapest all of the time. Indeed, the most cash strapped consumers may well be avoiding the convenience channel altogether in favour of the discounters.

"We also know that households shopping at these stores are likely to be time pressed. We believe there must be a strong EDLP offer to drive loyalty and encourage shoppers to visit habitually, together with tactical promotions with clear objectives.”

More for you

Post Office cash deposits and withdrawals
Post Office, DPD partners to rollout ‘Click and Collect’ services
Post Office, DPD partners to rollout ‘Click and Collect’ services

Parliament to launch inquiry into Post Office Horizon scandal compensation delays

Parliament is to launch an inquiry into delays in compensation settlements for sub postmasters affected by the Horizon scandal.

The newly-formed Business and Trade Select Committee will call ministers, subpostmasters and their lawyers to give evidence next week with a second session to follow in mid-November. The Committee’s chair, Liam Byrne MP told ITV News that there was “definitely a delay” in people coming forward for payment.

Keep ReadingShow less
C-store body warns of 'inflation-busting increase in wage costs'
Woman Holding British Pound
Getty Images/iStockphoto

C-store body warns of 'inflation-busting increase in wage costs'

Convenience store body Association of Convenience Stores (ACS) today (30) has warned the Chancellor about the negative effects of the new National Living Wage (NLW) increase, a day after the Chancellor announced a pay rise for over 3 million workers next year, with NLW rates rising by 6.7 perc cent.

From April 2025, the NLW will increase from £11.44 to £12.21 while 18-20 National Minimum Wage will rise by £1.40 per hour to £10 - the largest increase on record, marking the first step towards a single adult rate.

Keep ReadingShow less
Bacup Wine and Convenience shop, 34 Burnley Road, Bacup.

Bacup Wine and Convenience shop, 34 Burnley Road, Bacup.

Robbie MacDonald via LDRS

Shop’s licence bid rejected over illegal vapes and ‘no regard’ for children’s safety

A Rossendale shop has had a licence bid rejected after repeatedly selling vapes to children and having illegal products on its premises.

Management at the Ibra Superstore at 34 Burnley Road, Bacup, have shown ‘no regard’ for children’s protection and safety, and have insufficient controls for licensing, Rossendale councillors have ruled.

Keep ReadingShow less
SPAR retailer hits target to secure £100,000 free stock from James Hall

SPAR retailer hits target to secure £100,000 free stock from James Hall

SPAR North of England retailer Dara Singh Randhawa’s family store has been awarded £100,000 of free stock after hitting all his targets since moving to the symbol.

Dara and his family, who have their SPAR store in Patrington in the East Riding of Yorkshire, joined SPAR through its association with James Hall & Co. Ltd in August 2023 having taken the decision to maximise the store’s potential.

Keep ReadingShow less
Pound Sterling bank notes
iStock

National Living Wage to increase to £12.21 in April 2025

The government has on Wednesday announced its acceptance of the Low Pay Commission’s (LPC) recommendations on the rates of the National Minimum Wage (NMW), including the National Living Wage (NLW).

The rates which will apply from 1 April 2025 are as follows:

Keep ReadingShow less