C-stores share tips how to handle competition from nearby supermarket chains

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Lockdown has led to major changes in our everyday lives, with some already becoming long-term fixtures to keep saving lives (keep washing your hands everyone).

Adopting new shopping habits has become a major vocal point, with countless reports of people rediscovering and expressing their appreciation of having their corner shops and newsagents on hand.

For many, the sight of the supermarket queues tailing out into the car parks and panic-buyers have caused some to do a U-turn.

Studies from Kantar even show that sales at independent c-store brands such as Londis and Spar have seen sales more than double from March to 17th May.

A 69.3% year-on-year boost in sales during the 12 weeks to 14 June, according to the latest Kantar data, while 23% respondents from a YouGov survey said they have used these stores more during this period.

But as restrictions begin rapidly easing out week by week and return to the ‘good old days’, slowly returning, new customer loyalty for these independent retailers shall be tested if the weekly ‘big shop’ at big brands draws shoppers away.

For shopkeeper Rajendra Parekh, who has run Station Newsagent in Staplehurst for 15 years, says he fears his business will suffer greatly when post-Covid-19 when a Sainsbury’s store opens directly opposite him in 2021.

The c-store owner said that Sainsbury’s must provide him compensation in order to stay open, claiming the supermarket chain deliberately left him off the planning application in order to gain planning permission.

To add more salt to the wound, the planning application submitted and approved by Maidstone Borough Council mentions rivalling retailers SPAR and McColl’s, less than one mile away from the site.

Station Newsagents in Staplehurst, Kent

He said: “When I opened by business there was no plans to open a supermarket or anything, and they have just come and barged in. They’ve used my goodwill and business, I thought they would have to pay me some kind of compensation.

“When they do open they will sell everything. So I will have to up sale my goods in order to compete with them.”

Should he receive compensation from Sainsbury’s Mr Parekh said he would put it towards refurbishing Station Newsagent in order to keep attracting customers.

In response to the Mr Parekh’s appeal, Charles Bushe, a representative from Sainsbury’s, sent the following statement concerning the new Kent-based store.

He starts: “A Retail Impact Assessment (RIA) was submitted as part of the planning application which considered the acceptability of the proposed foodstore against local and national planning policy (with smaller shops in Staplehurst considered as part of this analysis).

“The RIA was objectively assessed by the local authority, with Maidstone Borough Council Spatial Policy Team raising no objections to the application.

“Maidstone Borough Council also undertook a full statutory consultation, which provided local residents and businesses with an opportunity to comment on the plans.

“In summary, the planning application was approved through the normal planning process at Maidstone Borough Council and no compensation is due to Station Newsagent.

“It is worth noting that the RIA found there was a massive amount of expenditure leakage from Staplehurst and it is envisaged that the new supermarket will claw back much of this expenditure so that it is retained in Staplehurst, with knock-on benefits for other local stores.”

While there hasn’t been another case similar to Mr Parekh’s we could find to highlight this dilemma between supermarkets vs independent stores, Asian Media Group spoke with other long-running stores for their tips and advice on how to continue thriving amongst the competition.

Shabs Ltd, South East London

Shabd Ltd in Belvedere, South East London

For Muntaz Suleman, who has helped run family owned Shabs Ltd in Belvedere for 25 years, believes that catering to customer demand for particular products, while offering a personal service, has been the key to their success.

The store is situated between an Asda, Co-Op and Sainsbury’s – all within an approximate ten-minute walking distance.

She said: “We have customers ask us for certain products that supermarkets don’t do. We will tell customers when it will arrive so they can come back, it’s very rare that we don’t. We notice when we stock what they ask for, they will keep coming.

“I think we give them that service that supermarkets cannot, because we have a few elderly customers who have not been able to come in due to the lockdown, so we gave them our telephone number so we could drop off stuff for them.

“I think customer relations are much better than ever before because we have required several new customers too. Some of them have said to us they didn’t even though this shop existed, so it goes to show how much people pay attention.”

The decision to shop closer to home has been proven to be a huge trend across the nation, with Neilsen figures showing almost one in five (17%) of sales in May being generated from UK c-stores alone.

It was also reported during the four weeks ending 13th June 25% of shoppers were purchasing from their closest local store more once lockdown was introduced.

But with three major supermarkets in close proximity, Ms Suleman noted that cashflow prior to the pandemic had been their biggest problem as a business.

The south-west London store admitted to seeing a brief footfall decrease when the Co-Op, the most recent major retail chain store in the area, opened its doors.

“It would affect us in the beginning when they first opened because there would be all these offers to give customers the incentive to buy from there,” she explained. “but after three months things went back to normal because people realised it was just another trick forgetting them to come in.”

Fortunately, this bounce back worked in ShabsLtd’s favour, with customers realising the impulse promotions in supermarkets was resulting in overspending.

“We don’t have that in our shop,” explained Ms Suleman. “customers like to buy price marked stuff so we try and get it to that price, they then don’t feel like they are being overcharged.

“Things that would stay in store for six months were selling within ten days going. Our cashflow has really prospered during this time, which is usually our biggest problem that we struggle with.”

Turner’s Newsagents, East London

Turners Newsagents in Ilford, East London

For Mahendrha Patel in Ilford, he also voices a similar outlook, that price is king when it comes to standing shoulders above the retail competition.

With over 40 years in the business Mr Patel says his c-store, Turner’s Newsagents, has seen three major supermarkets (Asda, Sainsbury’s and Morrisons) open within walking distance of their business.

However, the family-run shop’s simple and clear approach to pricing, store layout and cleanliness are the key reasons they believe have kept customers coming back.

“It’s all about pricing for me, obviously the competition is very high by having three major supermarkets nearby,” he said. “So I honestly think most independent store need to look into their pricing so we try and buy most products so the customers know what they paying from the company but what we don’t get we try and get as near as possible to what the supermarkets are stocking. You have to appeal to what the customers want.”

Despite their small shop size and currently having to limit the number of shoppers currently visiting in store, Mr Patel said this approach has always worked to their advantage of maintaining and building relationships with customers.

“We have had lots of competition over the years, but we have held our ground what we were doing 40 years ago we are still doing.

“For convenience stores, there’s almost no queuing and therefor no wasting time, people can just get in and out. Although we don’t have a choice we stock and sell the items people need.”

Although many independent and c-stores have thrived during lockdown, restarting life pre-Covid-19 across the nation has already begun, which begs the question: will the staying power of the corner shops continue?

For Turner’s Newsagents, the team already accepted that monopoly of supermarkets will not be wavering anytime soon and are proud to continue playing a key role within his community.

Mr Patel said: “The bigger you are the harder it does make it for smaller business, it does depend how run your business, we are not worried about the competition too much because we have been here so long and we have our customer base we know we won’t be able to compete with supermarkets.

“For us it’s about providing a service and being a familiar face to local people which you don’t get in a supermarket. Local people matter to us more so it does not concern me at all. I’d say convenience and service we provide what my customers need.”

Yet the traditional values and service of c-stores have proven to swiftly adapt to the social distancing measures. Mr Patel’s shop was one of many that began conducting home deliveries to regular buyers who are elderly and shielding, another potential pathway to overcome the battle of the supermarkets.

“We changed our opening hours so we could provide daily deliveries to people in the mornings,” he said. “We have a lot of respect of what we have done in the community, people are slowly coming back as lockdown is easing.”

So it seems there is hope and advantages for Mr Parekh and his Kent store that can be utilised once Sainsbury’s opens its newest store next year.

Amongst the big names in retail, the indie and corner shops have shown to still win customers over through their loyalty and personal service.

With most of 2020 being filled with uncertainty, let’s hope that the rest of the year and the near future will continue to offer good fortunes for UK c-stores.