Forecourt Trader - 30 years at the heart of the fuel retailing community

Taking a fresh approach

01 July, 2007
MBL targets forecourts with clear direction for Budgens and Londis following an extensive review
Page 20 
Independent forecourt operators have become the target of management teams at Londis and Budgens following an extensive review of the positioning of both brands.
They have spent the past couple of years - since the merger of the two brands into a single operational division, Musgrave Budgens Londis, -deciding on the most viable strategy both for their business and that of their independent retailer partners."After the merger things took a while to settle down," says Russ Halliday, MBL's marketing director. "We took a look at what we had and what we were doing. The market has changed so much - our competitors are not just Nisa, Costcutter and Spar, but Tesco Express and Sainsbury's Local. There's also been a real race for space in the forecourt sector in recent years."We took a look at where we were as a business and the strategy we wanted to adopt. We decided we wanted to build two genuine consumer brands, which is unique in the traditional convenience sector - I don't think anyone out there is developing their brands in a dramatic way."The problem was that the company had acquired two very similar brands. The only thing that differentiated Budgens and Londis was the size of the stores and the fresh mix within Budgens. So part of the work on the brands involved trying to pull the offers apart to create two more distinct offers."What we've come up with is two new brand positionings," explains Halliday. "We have a new 'philosophy', or 'brand essence' for Budgens, which is 'real food for today's communities'."For Londis, it's 'all you need for everyday living'. The reasoning behind the distinctions is that Budgens has a very distinct food-based offer. Its credentials for real food are unmatched in this sector - and that's what extensive consumer research has told us. Consumers also talked about the local element of Budgens - local not just as is in the location of the stores, but also because of its use of local suppliers."On the Londis side, we're trying to make it the best top-up shop there is - so that's where 'all you need for everyday living' comes in. We're trying to get retailers to provide an offer that caters for what shoppers want today."MBL currently has around 350 independent Londis forecourts and 13 independent Budgens forecourts -which is set to grow and is likely to reach 15 or 16 by the end of the year, with expectations of a considerable increase after that. There are 125 independent Budgens retailers altogether and the company is in the process of divesting its corporate stores, of which there are about 55 remaining, a programme which will be completed by the end of the year, according to Vince Maloney, sales director for Budgens."At the same time we're growing the Budgens business, and we're seeing more independent forecourts come to us," comments Maloney."Budgens' heartland is a community-based site that happens to sell fuel. Londis is the other way round - a more transient offer, which is why we have more Londis forecourts."The typical Londis forecourt is somewhere in the region of 1,200-1,500sq ft, predominantly situated in a rural area, with a lot of passing traffic, some serving the needs of their local community. Typical Budgens forecourts are retailers like former Forecourt Trader of the Year winners Suzie Hawkins and Jonathan and Rebecca James, with their impressive neighbourhood stores."We've got some good forecourt retailer testimonials, and we certainly want to add to our network of both Budgens and Londis forecourts," confirms Halliday."The overall number of forecourt sites may be diminishing, but those that are becoming available to the independent sector are on the increase as oil companies divest their networks - although there is definitely a race for space."We want the type of retailers that would sit in either brand - but we're not just going out for every single retailer that has a forecourt. We've done the brand work and put in standards that will enable both ourselves and our retail partners to grow their businesses in a sustainable way. But we have to get the right retailer in the right area with the right brand. For example, a retailer could make more money out of Londis, depending on his location, demography and consumer base, than he could out of a Budgens store."For Budgens, Halliday explains that the right retailer would have a very community-based store, which is most likely to be in a slightly more upmarket location - although he says they do work in non-affluent areas as well. Size is a key issue - stores would need to be around 2,000-2,500sq ft, and able to provide a strong fresh food mix. The store needs to be able to carry off the Budgens fresh food offer - the ablity to do at least 35% on fresh, which includes food-to-go and sandwiches."Where Londis has been well-established in the forecourt market, we're now going to establish the Budgens brand in forecourts. So this time next year, we could be looking at 32 Budgens forecourts," adds Maloney. "We're looking to rapidly grow the Budgens estate - and forecourts are an important part of that. He believes that more forecourt retailers now understand what Budgens is about: "If people want to grow their forecourt business Budgens has the offer that can compete with other strong brands. We can provide an extensive range of fresh foods, and we put an awful lot into the provenance of those foods. In terms of ethics we could probably match M&S."We're really promoting ourselves to independent retailers and feel confident enough to grow our business big time. Suzie's new site in Monmouth is equal or better than anything anyone can offer at the moment."In terms of development MBL is about to pilot new concepts for both Budgens and Londis brands: "The pilot stores will be a physical manifestation of the work we've been doing," explains Halliday. "We've looked at four areas in both brands to make sure we've come up with the right offer for the right retailer. Firstly, we focused on the products and services that each brand should be offering, so, the fresh mix and the provenance in Budgens; and the overall range and consistency of the range in Londis."We've also looked at training in both brands - because of Budgens' corporate store heritage, it's always provided very good retailer training. What we've now done is rolled that out over both brands to cover customer services, food-to-go, and how to sell fresh foods better. Another key focus has been the store fit-out - which will be seen in forthcoming store openings."And finally we have looked at communications - we're really shouting loud and proud about the fact we're supporting independent retailers. On the Budgens side we're promoting the uniqueness of the range we do; and on the Londis side, we're trying to put ourselves into a different place. Historically Londis was just about delivering boxes to retailers -now we're trying to make it a much more consumer-focused brand."Halliday says, apart from being able to provide a great convenience store, the company wants to be known for four key areas: bakery; food to go; fruit and veg; and alcohol."The fresh mix alone is the driver for why we're recruiting retailers from other groups. With rising utility costs, and rising wage costs through the minimum wage there are two ways you can go - you can put your prices up and alienate customers, or you can change the mix in your store."You can drive grocery as hard as you like, but we all know the real margin comes in fresh food - and no-one does the fresh mix we do."----=== musgrave's irish heritage ===Musgrave was founded around 130 years ago and is now Ireland's biggest grocery distributor, its core strategy being to support independent retail operators in the grocery sector. The overall business is currently made up of five divisions: Musgrave Supervalu Centra (MSVC) Republic of Ireland (ROI) and Northern Ireland (NI); Musgrave Wholesale Services (MWS); Musgrave Budgens Londis (MBL) in Britain and Dialsur which operates from a base in Alicante, south-east Spain.It acquired Budgens in 2002 and Londis in 2004 and merged them into one operating division - Musgrave Budgens Londis (MBL) - in January 2005, with headquarters in Harefield, Middlesex.It has more than 2,000 stores in the UK including 350 independent Londis forecourts and 13 independent Budgens forecourts. A programme of divesting its Budgens corporate stores - 55 remaining - will be completed by the end of the year.



My Account

You are not logged in.
  • Weekly
    Retail
  • Weekly
    wholesale
  • Daily
    Average
Weekly retail fuel prices: 18 September 2017
RegionDieselLPGSuper ULUL
East120.75128.55119.84
East Midlands120.29128.81119.63
London120.7558.57130.05119.82
North East120.2059.90129.98119.40
North West120.52128.62119.81
Northern Ireland119.2369.90126.85119.03
Scotland120.60128.18119.75
South East121.03130.63120.24
South West120.75129.31119.96
Wales120.35127.44119.57
West Midlands120.4262.90130.69119.84
Yorkshire & Humber120.1971.90128.67119.59

Most read

Are you relieved that as a consequence of the 2015 Modern Slavery Act, rogue hand car washing operations are now being targeted by the authorities as one of the prime sources of human trafficking and are being shut down?