As independent retailers continue to seek alternative ways to make money out of running a petrol station, fast food has become an obvious vehicle to do just that. Forecourts are well placed to cash in on the needs of hungry consumers, and the cash rich-time poor trend has been a big driver of the category.
And whatever type of site you operate, there’s probably a fast food offer to suit it – whether it’s a small bake-off outfit serving up pastries and savouries, or operating alongside McDonald’s as forecourt developer Margram does with its new-build sites.
The oil companies certainly haven’t missed a trick either – just look at BP with its Wild Bean Café offer. The major has thrown its weight behind Wild Bean big time, investing in advertising and most recently sponsoring national radio station TalkSport, which sees the Wild Bean Café promoted through a series of credits before and after each traffic and travel bulletin.
And testament to the fact that forecourts are in ideal locations to offer fast food, more big brands are starting to establish themselves in the sector. Burger restaurant brand Wimpy, for example, is giving retailers the opportunity to offer fast food with the backing of a recognised name. Earlier this year it introduced a more flexible solution to its Wimpy kiosk franchise – of which there are currently 10 operating on forecourts in the UK. The new Micro unit has a footprint of 8ft by 8ft and Wimpy pre-cooks the burgers in its factory. The retailer then reheats them on site, serving the product with a fresh bun and salad. The investment for retailers is £20,000, compared to £45,000 for the Wimpy kiosk.
The latest fast food brand to tap into the forecourt market is Subway, which has more than 21,000 sandwich outlets worldwide, including 2,600 in convenience stores and almost 400 forecourts, as well as busy high streets and shopping centres, college campuses, amusement and theme parks, airports and museums.
There are now over 285 Subway outlets across the UK and Ireland, with around 20 new stores opening every month. The chain plans to have opened over 2,000 Subway stores in the UK and Ireland by the year 2010. The chain recently opened its 50th store across all Ireland – on a forecourt in Dungannon, County Tyrone. And, like the US and Canada, Subway Restaurants is now the largest quick-service chain in Northern Ireland.
In November 2003, Subway Restaurants signed a deal with Spar, which will see a procession of Subway sandwich outlets open in Spar stores throughout 2004. The Spar/BP retail forecourt store on Belfast’s Holywood Road was the first Subway/Spar partnership in Europe, as well as the first Subway retail forecourt outlet to open in the UK and Ireland.
Paul Heyes, Subway development director and franchisee of the Subway outlet, says: “We realised the potential that this partnership offered both parties, and are delighted with the success of the store so far. The Subway/Spar collaboration is a great opportunity and we are extremely keen to develop more Subway stores within this vastly untapped market.”
Mark McCammond, operations director of Andrew Millar and Co (the retail company of the John Henderson Group, which owns the Spar franchise in Northern Ireland), says: “There is a significant demand in the convenience sector for freshly prepared sandwiches, and I feel the partnership between Spar and Subway can meet the demands of on-the-go customers who want fresh, top-quality products that offer something different.
“The Spar Holywood Road is the first forecourt in Europe to feature an in-store Subway sandwich franchise. Through this cutting-edge new concept, we rent a concession to Subway, who runs the sandwich bar itself. In this way, each partner is focusing on their own area of expertise: Andrew Millar on convenience retailing, and Subway on providing food-to-go meal solutions to the benefit of both parties.”
Following the success of the Spar/Subway partnership at Holywood Road, the company already has plans for a further six Subway concessions across the Spar chain in Northern Ireland. Neil Black, chairman of Subway’s Team UK and Ireland, says: “Subway outlets in forecourts and convenience stores have proven to be highly successful worldwide, and this is now being reflected in the UK and Ireland marketplace. We are currently targeting several brands of forecourts and convenience stores and will be presenting a case study from the Spar trial.”
Subway franchisees are said to benefit from nearly 40 years of experience and expertise that the Subway chain has to offer. Every new franchisee attends a two-week intensive training course in the US, and is continually supported by a Subway developer, of which there are 18 throughout the UK and Ireland.
Subway Restaurants bakes its bread fresh in-store throughout the day providing customers with fresh, quality food, made to order, from early morning to late at night.
The chain offers a wide variety of ‘made to order’ hot and cold submarine sandwiches using an assortment of breads, as well as a delicious range of deli-style sandwiches, salads and wraps, crisps and freshly-baked cookies.
One of the simplest ways to get into fast food is by introducing a bake off. Kate Raison, marketing director at Bakehouse, says: “The nature of the forecourt trade dictates that many consumers will be passing through on their way to or from work or during lunchtime. They may be feeling hungry, but will not have the time to stop for a leisurely meal. Today’s consumer is more discerning and will be looking for an interesting and satisfying snack to eat on the go. Bake-off provides forecourts with a quick and easy way to capitalise on this demand and tempt consumers filling up at key times throughout the day.”
A popular choice with independent forecourts is Country Choice’s Bake ‘n’ Bite concept, which offers everything from bacon sandwiches and sausage rolls to pizzas, chicken wings and potato wedges. And according to Raj Tugnait, marketing controller at Country Choice, promotions play a vital part in helping retailers grow their fast food business while offering added-value to the consumer: “If used properly, promotions get a bigger spend out of the consumer by encouraging them to spend more than they originally intended to,” he says. “Promotions are also an excellent way of trying new product lines.”
One forecourt retailer getting maximum return from his promotions is Thabet (Tab) Musleh, multiple site manager at Park & Shop in Strood, Kent. “We offer a whole range of deals and promotions, and they have really boosted sales,” says Tab. “We run a regular savoury and confectionery promotion which changes each month to keep interest high. These are a combination of our own deals and deals that Country Choice offers us each month through its Choice Cuts promotion programme. We promote our in-store bakery very heavily in and around the forecourt with posters, point of sale material, ‘A-boards’ and pump crowners, and this helps to maximise its profile. We bake little and often throughout the day so whatever time customers visit there is always that enticing aroma. We currently turnover about £1,100 per week on bake-off, with a 40-45 per cent margin – not bad for a site that has only been open for a year and whose bake-off area is not much bigger than the average family hatchback!”
Raj Tugnait says that the Park & Shop site is a good example of how to get things right, but also has other advice on how to make promotions a success. “It is very important to communicate what you are doing to your customers and make your offering convenient. For instance, don’t offer a deal involving items that are at opposite ends of the store, and don’t make a joke of your promotion either – customers know a good deal when they see one, and a penny off here or there will do nothing to do boost sales or profit. Many retailers make the mistake of running promotions on items that they either make high margins on or can’t sell, and this should be avoided wherever possible,” he adds. “Try to promote items that the customer really wants or needs and if it’s a supplier-funded promotion make sure you pass on the full benefit to the consumer – don’t be tempted to pocket the proceeds. Finally, and most importantly, remember the cardinal rule of promotions – don’t run out of stock!”
Country Choice runs a number of different types of promotion including buy-one-get-one-free, multi-buy (for example four for 99p) and link-save (such as buy a baguette and get a half-price coffee). “Careful rotation of such deals will ensure that interest is maintained all year round and that consumers don’t become bored,” says Tugnait. “Which is most successful will depend to a large degree on the site and the consumer profile and this is another area where Country Choice can assist, by using our experience of the market to offer free advice on which type of promotion we believe is best for each individual retailer.”