Bestway Retail’s dual-branded Costcutter and Bargain Booze store concept, which was launched last year, appears to be proving a success, with an outlet in Bolton delivering a sales increase of 48% since its opening in March.
Customer footfall has increased by 40%, chilled sales have doubled, and profitability has increased by 3% margin points driven by a new hot food-to-go offer.
The Bargain Booze section of the store, which now stocks over 750 SKUs of beer, wines, and spirits, is said to have had a big impact on sales from the previous 500 SKUs. There’s been a 24% increase in alcohol sales, now averaging £7,000 per week. This has been aided by a new range of ales and a ‘low/no alcohol’ section.
Shop owner, Kersheaup Vagadia, commented: “The hybrid implementation of the new Bargain Booze concept in store has yielded remarkable results for our store. With two prominent brands displayed above our door, we’ve witnessed a significant increase in footfall, not only gaining substantial numbers of customers but also an average basket spend increase of £2.20 per customer.”
The store conducted research and analysis, working closely with the Store Development, Retail and Commercial Teams at Bestway Retail, to identify areas of strength and weaknesses in its old shop which involved breaking down sales by category, examining the shopping habits and preferences of customers. This process highlighted that the store had only tapped into a small portion of its local customer base, presenting the store with a growth opportunity.
Vagadia said: “We leveraged this valuable insight to design our ideal store, ensuring that each identified shopper need was addressed.
“Planning encompassed the inclusion of a dedicated fresh bakery, a well-curated hot food section, a convenient drinks-to-go area, a wide range of fresh produce and chilled products, and an expanded product selection throughout the store to exceed our competitors’ offers. It has really opened our eyes to what our customers want and given us a new perspective of how to run our business.”
The ‘hot food’ section has emerged as the most profitable department in the store, consistently achieving an average margin of 38%. This is reflected in weekly sales of £1,300 which is a significant increase from the previous store which was £150 per week.
The expansion of Co-op own-brand products has also led to increased sales. In particular, chilled and fresh produce sales have tripled, with fresh meat and ready meals outperforming with a 270% increase.
Despite the store’s unchanged square footage, the store has expanded its product range by an additional 18%, contributing to its success.
Dawood Pervez, Managing Director at Bestway Wholesale, said: “We are continuously investing in store formats to help our retailers redefine their stores to meet today’s shopper missions. Our dual branded stores are leading the way and we are delighted to work with such forward-thinking partners – the results are a testament to the dedication and commitment of Vagadia”.
Jamie Davison, Retail Director at Bestway Retail, added: “Vagadia is a shining example of the entrepreneurs that are leading convenience. The results the store has achieved demonstrate our strengths in working closely in partnership with our retailers to deliver formats that drive both growth and profit for the retailer”.
To date, Bestway Retail has completed 10 stores to its store within a store concept’ and has a further 20 in the pipeline. The company stated that it is planning to expand the concept and supply into areas of the UK that Bargain Booze hasn’t historically operated within.
NAM Implications:
- A successful application of textbook retail principles.
- That has to become an incentive for a Bestway rollout.
- (And a pointer for others…)
