The chilled and fresh foods category is the last big unexploited opportunity in forecourts, according to Andrew Grant, director of trading (convenience) at Palmer & Harvey (P&H). "The supermarkets do this category superbly well," he says. "Just look at a Tesco Express where half the sales are of chilled lines whereas in some forecourts chilled accounts for just five or 10%." He reckons forecourts should be looking to get 20 or even 25% of their sales from chilled foods. "If you don’t invest in chilled you’ll never get the sales. Chilled is where the market is going and all the better retailers know this."

Grant says that in the past, barriers to a forecourt’s success in chilled have included a poor supply chain infrastructure and limited range but he reckons that’s changed. "At Palmer & Harvey we have the range and we can turn up with it as often as a forecourt needs it. The critical thing for forecourts is that although they have regular customers they will never have them in the numbers that the supermarkets have so they need longer to sell items. If they put a chilled ready meal out on display on a Monday, for example, the date codes need to be long enough for it to be on display all week if necessary." He says that P&H has been working with manufacturers to get extended life on chilled products. Indeed, in conjunction with Greencore Foods, it has developed the Kiveton’s Kitchen range of longer-life chilled ready meals. Greencore describes them as "high quality" and Grant says they are as good as supermarket ready meals.

There are 28 lines in total including 16 ready meals with dishes such as beef stew & dumplings, sausage & mash, lasagne, chilli & rice, Thai green curry & rice; as well as two pizzas, two tortelloni, four pasta sauces, onion bhajis, spring rolls, naan and garlic bread. The chilled meals all retail at £2.99, prices for the other lines vary.

The products have a shelf life of up to 12 days, and P&H is the exclusive wholesale distributor.

Wastage is of course a major cause for concern with fresh foods and Grant describes how forecourts deal with it as ’chicken and egg’: "They don’t want to stock too much because they are worried about wastage, however if they don’t stock enough, customers won’t have the confidence to buy. After all, if a consumer walks into a forecourt and finds one lonely ready meal in the fridge they are going to think something is wrong with it. They want to see a big, bold display to entice them to buy." He’s confident that if forecourts put out such a display, the sales will grow.

"With Kiveton’s Kitchen, for instance, we’ve taken the risk away because as well as the longer shelf life, retailers are getting 35% profit on return. That means they can afford to have a little wastage. Forecourt retailers have got to take a deep breath and go for it and their customers will respond," he says.

Another new chilled ready meals range comes from Unilever and features its Colman’s, Knorr and Bertolli brands. Products tie in with each brand’s individual strength so the Colman’s name appears on cottage pie, beef casserole and sausage & mustard mash; Bertolli on lasagne and carbonara; and Knorr on sweet & sour chicken & rice, chicken korma and chicken tikka masala (both with pilau rice). Each meal retails at £3.29.

Both the Kiveton’s Kitchen and the Unilever meals are made by Greencore Prepared Meals.

Meanwhile, forecourts can get up to six deliveries a week from P&H, dependent on the size of their order. Grant says the distributor serves every postcode in mainland UK from its four dedicated chilled warehouses: in Kent, Hampshire, Coventry and Glasgow.

Grant concedes that getting your bacon, cheese and milk range right is relatively easy to do but he admits that fresh fruit and vegetables are more difficult. "For ready meals we went to a manufacturer to get them to make them for us so we are doing the same for fruit and vegetables. We went to a produce packer and said we wanted forecourt-friendly packs that are fresh and can sell for a reasonable price. We are working on this and are weeks away from an announcement."

However Grant realises that some forecourts will already be sourcing fruit and veg from local suppliers. He says: "If you have a really good local wholesaler then great, but maybe they can’t always get you what you want. We will be able to fill in the gaps and also cater for retailers who need a full supply."

Grant explains that P&H has improved its service to retailers: "We have changed from simply just delivering goods to offering added-value services so we now have sales development executives who can do a business review for a customer. For a forecourt they could look at the chilled category and say ’with your location, your store size and your number of customers we would recommend such and such. They would highlight sales opportunities and work with retailers on a mini business plan. Sometimes retailers have the right space but the wrong range; we can help them." Grant says this service extends to everybody from an independent to a mini-multiple: "We like to think of ourselves as a retailer’s virtual head office."

He says retailers need to drive interest in the category too: "Promotions help by saying ’hey I’m selling chilled lines’," he says. "Buy-one-get-one-frees work fantastically well on bacon, particularly at weekends when people love a fry-up."

However he warns that it’s important not to devalue the category but rather add value: "We are keen on ’extra free’ promotions or ones that encourage people to buy more," he says. "Customers need to be encouraged to buy something to eat straight away and something to take home for later."

P&H’s focus on chilled and fresh foods is great news for the industry, especially in the light of research from Him’s Convenience Tracking Programme, which revealed, among other things, that 45% of shoppers were prepared to buy salads from supermarkets but only 14% would buy them from a convenience store. This would seem to indicate a lack of faith in c-stores’ fresh produce.

The research found that 7% of forecourt shoppers questioned intended to buy chilled foods on their visit and 7% actually did. Likewise with fresh fruit and vegetables, 3% of forecourt shoppers intended to buy these items and 3% actually did. On the surface that is excellent, however Him reckons more needs to be done to encourage impulse sales.

A spokesperson says: "We need to think about getting customers to buy more. Perhaps by using promotions such as ’buy carrots and get beans half price’ - after all M&S does this and does it very well."

Promotions are in fact a big deal for forecourt shoppers. Indeed 17% of chilled food shoppers said they intended to buy something on promotion. However the forecourt average is only 8% - so perhaps the chilled shoppers are buying meal deals.

Overall, just 3% of shoppers said their main reason for visiting a forecourt the day they were questioned was to buy chilled foods. The majority of ’chilled’ shoppers bought their items between 5pm and 10pm which would seem to indicate that they were topping up on their way home from work for that evening’s dinner.

It would seem therefore that chilled sales are there for the taking, it’s just a case of taking the plunge - yes you might lose a little via wastage but you’ve got a lot more to gain via extra sales and profits.

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=== Brand News ===

? Unilever UK is investing £15m in Flora pro.activ in a bid to end consumer confusion about cholesterol-lowering products. One of the campaign’s key messages is that there is no food that lowers cholesterol more than Flora pro.activ. Activity includes a promotion where consumers can buy two packs of Flora pro.activ and get a free cholesterol and heart test at Lloyds pharmacies.

? Britain’s biggest-selling fat-free yogurt brand, Mullerlight, is currently the subject of a £4.4m relaunch. Activity includes two new varieties: wild blueberry and smooth peach; new packaging and new TV advertising.

? New Weight Watchers quiches are available in three varieties: smoked bacon & cheese, broccoli & gruyere and tomato & cheese. All are described as "low in fat and full of flavour". The 165g individual quiches have a recommended retail price of £1.49.

? Yoplait has launched a ’Calcium every day, the easy way’ campaign, which it reckons could grow the children’s chilled yogurts and desserts sector by up to 20%. It will be supported by a £6m investment including TV advertising, sponsorship, website activity and PR.

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=== Case study: Lilley’s Centra ===

Una Lilley at Lilley’s Centra, Enniskillen says they have very good fruit and veg sales: "We don’t have a huge amount of space for it but we do offer a full range including organic lines. We’ve been stocking organic produce for a couple of years; our customers asked for it then as there was nowhere locally selling it. We pushed our supplier to get it for us. Now we have a Tesco and an Asda nearby doing it too but we are still selling a decent amount."

Una gets chilled deliveries six days a week from Musgrave. She does get some wastage but says you have to keep it under control: "We have a target to stick to but we are lucky in that if something is coming up to its date we can use it in our hot food and deli counter."

She is currently experimenting with a new range of ready meals that her staff are making: "It’s a work in progress really but it’s going well. Garlic potatoes, chicken & broccoli bake and lasagne are the best sellers. We make them on Thursdays and sell them on Fridays and Saturdays."