With the likes of Sainsbury and Tesco on the forecourt convenience shopping scene, independent operators are increasingly faced with the challenge to develop their fresh and chilled foods offering. And judging by some of the independent sites in the network, many are succeeding too. Those that have the support of a symbol fascia have found the challenge easier to meet and as a result, fresh fruit & vegetables and chilled foods are fast forming a core part of the forecourt shop offer. As more forecourts become fully-fledged convenience stores – now 89% of the total network – shoppers are also expecting to see a well-managed range of fresh and chilled foods. And, according to 2004 IGD research looking into average sales contribution by category in co-owned forecourt c-stores, chilled foods make up 4.4% of shop sales; with milk adding a further 2.5%, fruit & vegetables 1%, and sandwiches 4.8% to shop turnover. The category is profitable, too, with average gross margins at almost 42% for sandwiches, 36.1% for milk, 35.5% for chilled foods, and 30.5% for fruit & veg, according to the IGD. Keith Boyce, category director at Palmer & Harvey, says that key products for the forecourt sector are foods to go such as sandwiches and pastries, which must be sold chilled. “Pastries and slices account for almost half of savoury pastry sales in the food on demand environment, and there is also huge potential to extend consumption to drinks, savoury snacks, yogurts and desserts,” he says. And recent research for Shell by Harris International Marketing’s Convenience Tracking Programme (January 4, 2005) showed that chilled food shoppers visit forecourts more often than any other category shoppers and spend 90% more per year than other forecourt shoppers. “Furthermore, the meal solutions sector lends itself particularly well to premium pricing – meaning good cash margins for the retailer,” says Boyce. Promotions and meal deals are key to maximising sales of the chilled category, says Boyce, and effective signposting will ensure the shopper is aware that chilled products are stocked. “Retailers should also consider capacity – most are grossly under-refrigerated and don’t have the space to stock a credible range,” adds Boyce. “It sounds basic but make sure you are stocked up – for instance there is a huge opportunity for breakfast and lunch on the move which is currently not being capitalised upon.” ON THE MOVE Chilled food to go is a major growth area for the forecourt sector, and Country Choice, which supplies the Bake & Bite brand, can provide retailers with a full range of sandwich fillings, breads and salads, as well as the support to operate the fixture in an efficient and profitable way. Raj Tugnait, marketing director of Country Choice, says: “Growth is coming from fresh food on the move – forecourt customers want to fill up, grab a bite to eat, and go.” The Bake & Bite brand has just been completely overhauled and revamped (see products & promotions p68), and part of this has involved the development of new product categories. The chilled range now fits under the Fresh & Tasty banner and targets the more health-conscious shopper. The rrp for salads ranges from £1.99 to £2.49, with profit margins of up to 80%. Country Choice’s Choice Salads concept allows retailers to create their own menu of salad pots from a wide selection of fresh ingredients. The salads are easy to put together by following a step-by-step guide, which allows the member of staff to serve ‘all in one’ or ‘layered’ salad options. New flavours in the Bake & Bite Choice Salads all in one portfolio include Thai noodle; roasted vegetables & couscous; and spicy tomato & penne pasta. Ingredients available for the layered pastas include continental leaf, hard-boiled eggs, houmous and prawn marie-rose. Independent forecourt company Triple Eight has been putting a major focus on bakeries as its network of sites is upgraded. The latest development was at Salisbury, and part of that revamp included the introduction of the Bake & Bite chilled range of baguettes, salads and desserts such as carrot cake and chocolate cake. Ian Bowman, operations manager for Triple Eight, says: “Over the past three or four years, food to go on the forecourt has changed hugely with a wider variety of products on offer. I’m always looking for something different and I’d been getting into salads for quite some time so when Country Choice launched its Choice Salads range we became a trial site. “It’s a good add-on to the hot food and means we can offer a better range to the ladies that are coming into the sites – they’re not looking for a pie or a pasty, they want something healthier.” The Bake & Bite chilled range contributes about £1,500-2,000 a week to Triple Eight’s Salisbury site, and that’s about 50% of its total bakery. And with margins ranging from 40-50%, Ian says it’s a very profitable area and that sales are climbing all the time. At of the end of March, Country Choice will also be able to supply retailers with a range of Innocent smoothies, Johnsons fruit juices, Ubley yogurts, and Priory Falls bottled mineral water. Snack brand Ginsters has also been making big inroads in the forecourt sector, and at the start of 2005, sales of the Ginsters brand reached a record high of £225m, making it one of the biggest fresh food brands in the UK and the clear brand leader in the forecourt market – with a 67% share. Ginsters sandwiches were recently relaunched with several new products added to the range, including breakfast and pork stuffing & apple rolls, Mediterranean tuna & cheese salsa wraps, and a triple meat feast sandwich. Other variants have also been improved, and according to research by HIM, Ginsters was chosen by forecourt consumers as their most preferred sandwich brand in the UK. Sophie Colquhoun, category controller at Ginsters, says: “Consumers purchasing sandwiches at the forecourt, spend an average £5.66 per visit. If the preferred brand isn’t available, however, our research shows that 36% will go without. This is a big lost sale and has a considerable affect on profitability so constant availability of the top selling lines is key.” Keeping the range simple and uncluttered is essential, adds Colquhoun, as is the use of point of sale and signage to create excitement at the cabinet. “Vertically blocking categories will also better enable customers to scan the fixture and make their purchase,” she says. “Shelf availability is very important, not only to ensure that what the customer wants is available but also to maximise visual impact. Allocating a fair share of space by brand and category, and ensuring short-life products are regularly rotated by date is simple advice, but without a comprehensive approach that considers all the elements, sales will ultimately be lost.” Food-to-go innovation has been coming thick and fast over the past few years and in May 2003 Heinz Soup Cup was launched to meet changing consumer needs as the first handheld microwaveable soups that can be consumed on the go. Heinz research shows that the sandwich/soup combination is a popular choice at lunchtime, and also that consumers spend an average of two minutes 20 seconds instore on an impulse purchase, of which at least 40 seconds are spent in front of the chiller cabinet. “Around 63% of soup is consumed at lunch and Heinz research shows that 72% of consumers who trialled Soup Cup, ate it with a sandwich or bread,” says Chantal Busson, senior brand manager for Heinz Soup Cup. Heinz research also reveals that the smallest change of temperature has a significant impact on soup sales as consumers seek out warming lunch options. “Forecourt retailers should ensure Soup Cup is merchandised at front of store in order to maximise sales during the colder months,” says Busson. There are four flavours in the range – sundried tomato & basil; forest mushroom; chicken & golden sweetcorn; and cream of tomato soup. Continuing the demand for healthier snacks, Heinz offers Salad Shakers as a healthy alternative to sandwiches. Tom Cardwell, marketing manager for Heinz Salad Shakers, says: “Salad Shakers are the ideal grabbable, healthy lunches for on-the-goers, as they can be eaten straight from the shaker and have snap-on lids to prevent spillage.” Salad Shakers come in two varieties – Chicken Caesar and Greek Salad – and have a rrp £2.99. The salad dressing is included in a separately packed portion inside the carton. CHEESE SNACKS According to Easton Millar, trade relations manager at Kraft Foods, which supplies the Dairylea brand, cheese snacks have recorded formidable growth of nearly 29% over the past year. “Dairylea accounts for 32% of cheese snacks value sales with Dunkers Jumbo Munch and Original Breadsticks both contributing to Dairylea snacks growth,” he says. “The best-selling products in our chilled snack portfolio include Dairylea Lunchables Stack’ems in Yummy Ham and Tasty Chicken, Dunkers Jumbo Munch and Original Breadsticks.” In September 2004 Dairylea Lunchables was relaunched with a number of improvements, which included a further 10% reduction in average salt content in addition to the 30% reduction over the previous two years. The product now has thinner meat and lower fat Dairylea. The packaging for the Lunchables range was also redesigned to drive standout instore and enhance nutritional messages on the back of the pack. The relaunch has helped to drive growth of over 10% value sales for the Kraft Dairylea Lunchables convenience sector core range and is now worth more than £500,000. A new brand also came into the cheese snacks arena in September last year. Manufactured by Kerry Foods, Brunchettas comprise cheese wedges, crunchy continental breads and tangy relishes. There are three varieties in the range – ploughman’s relish, red pepper & onion, and pineapple & chilli – and the rrp is £1.69. The brand has already received widespread distribution through independents and major multiples, and “excellent” sales have resulted in a second burst of TV advertising and range extensions for 2005. Meanwhile, the Illchester Cheese Company offers prepacked mini whole cheeses in 150g packs with an extended shelf life, making them ideal for the convenience sector. Flavours include applewood – the UK’s favoured smoked cheese flavour; Mexicana – a blend of cheddar and mixed peppers; Crandale – a combination of wensleydale and cranberries; white stilton and apricots; and double Gloucester with chives and onion. Other popular chilled snacks include pork pies, and Pork Farms, whose products are available in the forecourt sector through Kerry Foods Direct to Store, has launched a promotion selling three snack-size pork pies for the price of two. The offer kicks off on March 7 and will run for four weeks. Local Authority One means of creating a point of difference is by introducing locally sourced chilled and fresh produce. Julian Holliss, who operates three service stations in the South Hams area of Devon, has been selling local produce for about 10 years. In that time, the number of producers he deals with has grown to around 20 suppliers. Julian’s sites sell local produce across most categories, including fresh meat, fish, sandwiches, vegetables, confectionery, alcohol, crisps and cakes. It now accounts for over 30% of his chilled fixtures and Julian expects this to continue to grow. “Local produce has become an integral and essential part of our overall offer,” he says. “Local produce compliments the proprietary range sourced from Spar wholesaler Appleby Westward and provides the consumer with an additional choice. This additional choice can bring the consumer into the store and creates a degree of loyalty. Such consumers then often make their staple basket purchases that they may have purchased from another outlet. “The quality of the produce is of paramount importance and we are fortunate to be associated with excellent producers, many of whom have won national awards and created brands names in their own right.” Julian says that he has seen excellent growth in fresh meats on the merits of the product alone. Aune Valley Meats from Loddiswell, an established and renowned farming family butcher, provides Holliss Service Stations with a range of pre-packed meats including steaks, chicken breasts, pork chops, lamb chops, minced meat, steak and kidney, sausages, a mixed grill pack and roasting joints. The range is complimented by two additional local farmer producers (Poole Farm and Jill Rowden Meats) with beef burgers and flavoured sausages. “Last-minute barbecue catering is an essential and growing part of our summer business and we are now in a position to offer the meat and fish in addition to the off licence, bread, salads and charcoal requirements,” says Julian. Local meat is also used in their food-to-go offering. A roast joint is cooked daily for hot meat baps, and sausages and bacon are used for breakfast baps and baguettes. Other established products include smoked salmon, meats and fish from the Dartmouth Smokehouse; an award winning range from Loddiswell Cheeses; organic products from Tideford Organic Foods including soups, pesto sauces, pasta sauces and rice puddings; and organic fruit juices from Heron Valley. Alternative organic vegetables are supplied by Westcountry Worms of Blackawton, which include Swedes, potatoes, cabbages, leeks, peppers, tomatoes, onions, cucumbers, pumpkins, parsley, herbs and other seasonal produce. “Cauliflowers and cabbages are sourced from a local farmer and delivered twice a week on the day that they are cut and this provides us with unbeatable freshness and quality,” says Julian. His two most recent suppliers are Manna of Devon from Kingswear, which provide a range of dips, chutneys and sauces including olive Jam, red pepper chow chow, fresh olive tapenade and Hummus, and the South Devon Chilli Farm, which offers a range of chilli products, including fresh, dried and smoked chillies, hot sauces, preserves and chilli vinegar. “I anticipate this introduction will provide both an excellent product and a great souvenir item for the holidaying customer,” says Julian. The average profit margin across its local suppliers is 25%, and in most cases, says Julian, local produce is reasonably priced because the route to market is direct from producer to retailer. Julian says that his company is fortunate to be located in a rural area with an abundance of excellent local producers, and following the progression of their local produce offer, it has now become an important part of their marketing. He is now working with local suppliers on a radio campaign, in which each supplier will advertise their products within Julian’s existing advert. “The objective is to increase local awareness to the quality and importance of local produce within the community,” he says. For any retailers who want to source local producers/suppliers, Julian suggests attending a local farmers market and local/county shows where many producers will be promoting their fares, which can be seen and tried first hand. He is also a member of the South Hams Food & Drink Association. “Quality is the most important factor and retailers must be sure of the products that they are offer,” he advises. “Commitment to the local ethos is also important, as consumer awareness and sales growth do not happen automatically. Retailers must be dedicated to this ethos and the management of local produce, as initial wastage can be painful.”