Suresh Arulanantham is no stranger to hard work, or to the nuances of the retail industry. The winner of the Tobacco Retailer Award at the 2024 Asian Trader Awards, he has cemented his reputation as a retailer who not only understands his customers but also adapts to market changes with precision and agility.
At the helm of the My Costcutter Murco store and forecourt in the seaside town of Rye, East Sussex, Suresh has transformed a modest petrol station shop into a “thriving” convenience store that continues to defy industry trends.
Starting his career in 2006, also at a petrol station, working for Murco, he quickly grasped the operational intricacies of fuel retail. By 2008, he had moved into management, and in 2016, Suresh took the bold step of becoming an independent retailer.
In 2021, he made a significant investment by acquiring the Costcutter Murco store in Rye, by that time his fifth site. A comprehensive refurbishment of the store was completed by early 2023, with more than £100,000 poured into the shop.
“We changed the layout fully, and changed the counter position to the corner side,” Suresh explains. “Sales went up by 80 per cent after the refit, so it's been doing really well.”
They are now undertaking a £200,000 revamp of the forecourt, cementing the site as a one-stop shop for locals and visitors alike.
Tobacco success
At a time when tobacco sales are plummeting nationwide, Suresh's store has seen a five per cent increase in this category. “It is mainly availability and pricing,” he says.
His strategy is simple but effective: stock everything, price it fairly, and build trust.
“Whoever smokes tobacco, they don’t really give up,” he states matter-of-factly, acknowledging the loyalty of his customer base. By ensuring stock reliability and linking tobacco with other key product categories like chilled alcohol and food-to-go, his store has become a habitual stop for regulars.
“Tobacco is a key footfall driver to our store. We keep it minimum, recommended retail selling price as Costcutter recommends,” he adds, making it clear that affordability is a cornerstone of his business strategy.
Sales are a mix of value and premium brands. “Sales of the premium lines stay the same. They will never drop,” he notes. They stock a large number of RRP products, which in these ongoing cost-conscious times is really key to many of their customers.
The 2023 refit created more space for the tobacco category at the My Costcutter Murco store and forecourt in the seaside town of Rye, East Sussex
The 2023 refit created more space for the category, and the store’s tobacco cabinet is a masterpiece of efficiency. A two-metre-wide under-counter unit holds 1,500 units, organised alphabetically for quick access.
“We introduced the cabinet across all our stores a couple of years ago and so were keen to do the same when we had this store’s refit,” he says.
The transition to this new cabinet, with the spirits range located above it, has given more space and driven more sales, with customers mixing and matching more, for example tobacco customers now buying alcohol and vice versa.
The new cabinet has also increased the amount of stock that can be held on the shop floor by around 15 per cent. “This means our team needs to restock only once a day, rather than twice daily as was needed with the previous cabinet. The tobacco is also much easier to access for staff than the old unit,” he explains.
The cabinet’s design – low and discreet – reduces theft while improving staff efficiency. They have focused on labelling in alphabetical order so that team members can locate products quickly, as “we can have around 350-400 tobacco transactions daily,” he adds.
The tobacco cabinet at the My Costcutter Murco store
The range comprises 65 per cent cigarette sticks, 25 per cent roll-your-own tobacco, five per cent cigars and five per cent accessories. Whilst a small part of sales currently, the store keeps on top of market trends with a range that includes heated tobacco products and cigarillos.
“We are trying Terea sticks [refills for the IQOS heated tobacco device] at the minute with the customers. It is starting to pick up,” he reveals.
But it’s not just about logistics. Suresh understands his customers intimately. “95 per cent are regulars,” he says. “The cashier knows what they need.” This personal touch extends to home deliveries for elderly or less mobile customers. “We take their tobacco order to them outside,” he says.
Adapting to change
His foresight extends to the future of vaping – a segment that has shown fluctuations due to impending regulatory changes.
“Vape sales slightly dropped since they announced the ban (on disposable vapes),” he admits, but he’s already pivoting towards reusable devices and alternative products.
“We are constantly reviewing new flavours and formats. We have started introducing a few new vapes ... It’s selling okay. But in the future, when they stop disposables, I think the reusable devices will pick up,” he remarks, indicating a keen awareness of evolving market preferences.
And staff, some of whom are vapers themselves, recommend products with genuine expertise. “They can talk impactfully about different flavours,” he says.
The store’s vape stand, strategically placed by the counter, drives visibility. Brands like Elf Bar and Lost Mary fly off the shelves, and a 10 per cent sales uplift in the past year proves the strategy works.
“We focus on delivering great pricing for our vaping products,” Suresh emphasises. “People return to us regularly as not only are we cheaper than many competitors, but they enjoy our service and chatting to our team.”
The art of customer loyalty
A retailer can stock the best products, but without customer trust, success will remain elusive. Suresh understands this principle better than most.
His staff don’t just serve; they connect. “They have a great skill in engaging the right customers in the right way,” he says.
And regular training through CPL [Continuous Professional Learning] ensures high standards.
“All the staff are doing around 15 or 16 courses. It gives us confidence and a proper process for the customer service and with health and safety,” he explains. “We have a professional reputation, so people know to never try and approach us for underage sales.”
My Costcutter Murco store in Rye is a lifeline for the local community
They also get regular visits from area reps from JTI and Imperial to help support this.
“JTI is helping really well,” he notes. “They are always on the phone, they visit regularly to the store and give us feedback.”
Good incentives from suppliers for both team members and the store also help drive sales.
“As an example, as a store we get around £1,500 a year in rewards from JTI. Among incentives Imperial have done with staff include keeping a barcode from packaging and when they next visit the store they have given them a voucher,” he reveals.
His rewards programme through the MyDD Points App further enhances the bond with customers. By offering loyalty points, customers feel incentivised to spend while the store maintains its reputation for product availability. “It’s win-win,” he says. “It's me keeping the product, at the same time, we get a little bit of something for the rewards, and also the customer could benefit.”
While Suresh embraces traditional customer service values, he also leverages technology to refine operations. His stores use Costcutter’s CPOS system, that provides real-time order suggestions and stock control insights.
“We are keen on continuously updating the stock level, reducing the wastage. We have deliveries six days a week that will give us 100 per cent availability,” he states. “This is a big driver of our repeat business as customers trust us to have stock of their cigarettes, tobacco or vapes.”
A member of staff is responsible for ordering, which helps ensure everything runs efficiently and they are always well stocked. A safe cabinet at the back of the shop, which can hold about 100 cartons, also helps ensure they have good stock levels, besides enabling them to take advantage of great deals and to stock up.
The store is more than a business; it’s a lifeline for the local community. “There is no big supermarket around,” Suresh explains. “Lots of people depend on us.” From Co-op products to emergency milk runs, the store fills gaps left by larger chains.
And they match prices with their nearest supermarket competition, situated half a mile away. “We are losing little bit of margin, but we are mostly matching the price,” he says.
Staying ahead
Retail is not without its hurdles. Rising product costs, supply chain disruptions, and competitive pricing pressures are ongoing battles. “Prices are going up ... it slightly impacts sales,” Suresh admits.
Shoplifting, another common concern for retailers, is kept in check through strategic staffing. “We always have at least two staff members on duty, mostly three or four,” he notes, reinforcing the importance of vigilance.
Growth is an integral part of Suresh’s vision. Beyond his Rye store, he operates four additional stores in and around Ashford, four of them under the Costcutter fascia, and the remaining one a Budgens. All of them have petrol stations, with the Budgens being an MFG brand fuel station.
The My Costcutter Murco store and forecourt in Rye, East Sussex
And he’s not stopping there. “We are buying another store this month, Newtown Post Office in Ashford,” Suresh reveals.
Another refurbishment is on the anvil, presenting another opportunity to grow.
As for the generational tobacco ban? He’s unfazed. “Whoever is smoking, they are still smoking,” he says pragmatically. “They are introducing new products. So, I don’t know what’s going to happen in the future.”
Suresh’s advice to fellow retailers is refreshingly straightforward: “We are keeping the availability and the price. Those are the main two things.” And he hastens to add: “Customer service – that’s the key thing.”
“We don’t make much money because we keep it at minimum margin with the recommended retail price,” he says. It’s a sentiment that underscores his dedication to community retail – offering people what they need, when they need it, at prices they trust.
