Over the period from 1994 to 1999, convenience store retailing in the UK has achieved a recognisable identity. However, with recognition has come change, and the sector is now consolidating with a number of recent acquisitions. In confectioner, tobacconists and newsagent (CTN)-based stores, T&S PLC has expanded rapidly; while in grocery-based specialist stores, Alldays is becoming increasingly dominant.
Most significant is the interest now being shown by the large food multiples, which, in addition to developing their own convenience stores, are very actively arranging joint marketing deals with some of the larger oil companies, intent on gaining increased access to sites on petrol station forecourts.
Key Note estimates that at the end of 1998 there were around 30,000 convenience stores in the UK with a selling area of 300 square feet and above. Total sales for 1998 are estimated at £14.92bn. In the period from 1999 to 2003, it is predicted that sales at current prices will increase by 25.6% to reach £19.62bn, an increase in real terms of 19.5% at 1998 prices.
By sector, the largest growth is predicted to come from the major food multiples. Starting from a low base estimated at 2.6% of the market in 1998, by the year 2003, they will have more than doubled their sales through convenience stores. The second largest increase in sales by value – predicted at 59.2% – is forecast to come from co-operative societies, now rebranding under a ‘Welcome’ banner.
As the UK population ages, it welcomes the personal service offered by convenience stores. There are more single households and an increasing appetite for snacks, fast food, and 24-hour shopping – especially in city centres. In opposition to this, some studies point out that fewer people are visiting convenience stores than did so in 1995/1996. They suggest that one of the key challenges facing the new breed of convenience store retailers is to repair customer perceptions damaged by visits to expensive, poorly stocked and badly managed independent stores. They point out that today’s top-up shoppers still need convincing that things have changed and that convenience stores can offer a viable and reasonably-priced alternative to supplement superstore shopping. Executive Summary taken from ‘Convenience Retailing’ by Key Note Ltd, price £279, to order your copy click here. Table of Contents Executive Summary taken from ‘Convenience Retailing’ by Key Note Ltd, price £279, to order your copy click here.
Executive Summary
1
1. Market Definition
2
INTRODUCTION
2
Market SECTORS
2
Product Mix
3
Table 1: Typical Sales Mix in a Typical Grocery-Based Convenience Store (% share), 1998
4
Number of Convenience Stores
5
Table 2: Estimated Number of UK Convenience Stores by Sector (number of stores and %), 1998
5
Table 3: Leading UK Convenience Store Groups by Sector and Number of Outlets, 1998
6
Petrol Stations at Supermarkets
10
Table 4: Number of Petrol Stations at UK Supermarkets, 1998
11
Symbol Traders – Grocery-Based Convenience Stores
11
Spar
12
Table 5: Typical Spar Convenience Store Formats
13
Specialist Chains
13
CTN-Based Convenience Stores
14
Off-Licence-Based Convenience Stores
15
Petrol Forecourt Convenience Stores
15
Convenience Tracking Programme
16
Table 6: Category Performances – Convenience Tracking Programme (%), 1998
17
Co-operatives
17
Major Multiples
18
Independents
18
GENERAL MARKET TRENDS
19
Demographic Change
19
2. Market Size
20
THE TOTAL MARKET
20
Table 7: UK Non-Specialised Food Store Outlets at Current Prices (£m), 1994-1998
20
Convenience Tracking Programme
21
Table 8: Convenience Tracking Programme (CTP) Performance Indicators (square feet and £), 1998
21
Number of Convenience Stores
22
Table 9: Estimated Penetration of Convenience Stores in the UK by Sector (number of outlets and %), 1998
22
Convenience Stores on Petrol Forecourts
22
Table 10: Estimated Number of Forecourt Shops on Petrol Stations in the UK (number and %), 1995-1998
23
TOTAL POTENTIAL UK MARKET
24
Table 11: Estimated Potential UK Market for Convenience Store Retailing Format by Number of Outlets and Value at Current Prices (number, £m and %), 1998
24
3. Industry Background
26
RECENT HISTORY
26
INDUSTRY CONCENTRATION
27
Share of Total UK Food Sales
28
Table 12: Convenience Stores and Other UK Food Sales (£m and %) 1998
28
DISTRIBUTION
29
TRADE ASSOCIATIONS
30
Association of Convenience Stores
30
National Federation of Retail Newsagents
31
Petrol Retailers Association
31
National Licensed Retailers Association
31
The British Retail Consortium
31
4. Competitor Analysis
33
THE MARKETPLACE
33
Table 13: Comparative Numbers of UK Convenience Stores by Sector (number and %), 1995 and 1998
33
MARKET Leaders
34
Alldays Stores Ltd
34
Financial Results
35
Budgens PLC
35
Financial Results
35
Costcutter Supermarkets Group Ltd
35
Financial Results
35
Londis (Holdings) Ltd
35
Financial Results
36
Spar Landmark Ltd
36
Financial Results
37
T&S Stores PLC
37
Financial Results
38
Other Companies
38
Star News Shops Ltd
38
Tesco/Esso
38
Safeway/BP
38
J Sainsbury PLC
39
Co-operative
39
Shell UK Ltd
39
Stores Scanning EAN Symbols
40
Table 14: Convenience Stores with EAN Scanning (number of stores and scanning lanes), July 1998
41
Advertising and Promotion
41
Table 15: Main Media Advertising Expenditure of UK Convenience Stores (£000), Year Ending December 1998
42
CONFERENCES AND EXHIBITIONS
42
5. Strengths, Weaknesses, Opportunities and Threats
44
STRENGTHS
44
WEAKNESSES
44
OPPORTUNITIES
45
THREATS
46
6. Buying Behaviour
47
DEMOGRAPHIC CHANGES
47
Table 16: UK Population by Age, Sex and Productivity (000), 1996-2031 48
CHANGING EATING HABITS
48
SHOPPING HABITS OF UK ADULTS
49
Table 17: Shopping Habits of Adults in Great Britain (%), 1998
50
NEW SHOPPING PRACTICES
53
Table 18: New Shopping Practices of Adults in Great Britain (%), 1998
54
Table 19: Reasons for Shopping at Convenience Stores Versus Superstores (% of responses), 1998
57
Table 20: Frequency of Grocery Shopping for Adults in Great Britain (%) 1995 and 1998
58
EXPENDITURE
59
Table 21: Weekly Expenditure on Grocery Items by Female Housewives in the UK for Eating at Home (%), 1995 and 1998
60
7. Outside Suppliers to the Industry
61
INTRODUCTION
61
FOOD MANUFACTURING
61
DISTRIBUTION
62
Cash and Carry
62
Technology
62
8. Current Issues
64
SHELL
64
FOOD-TO-GO KIOSK
64
PRICING
64
STAFF
65
MURCO INCREASES OFF-LICENCES
65
EXPANSION FOR MACE
65
ICELAND EXTRA
66
ALLDAYS
66
BUDGENS
66
Association of Convenience Stores
67
FRESH EXPRESS
67
LOTTERY
67
FOOD STANDARDS LEVY
67
TESCO
68
COSTCUTTER
68
ANTI-COMPETITIVE SUPERSTORES
68
LONDIS
68
ELF
68
9. Forecasts
69
THE UK ECONOMY
69
FORECASTS 1999 TO 2003
69
At Current Prices
69
Table 22: Forecast Sales for Convenience Store Retailing at Current Prices (£m), 1999-2003
70
At Constant Prices
70
Table 23: Forecast Sales for Convenience Store Retailing at Constant 1998 Prices (£m), 1999-2003
71
10. Company Profiles
72
Alldays PLC
73
Budgens PLC
75
Costcutter Supermarkets Group Ltd
77
Londis (Holdings) Ltd
79
Spar Landmark Ltd
81
T&S Stores PLC
83
11. Further Sources
85
Associations
85
Periodicals
86
Directories
88
General Sources
88
Hoppendstedt Bonnier Information Sources
89
Government Publications
90
Other Sources
91
Understanding TGI Data
93
Number, Profile, Penetration
93
Social Grade
94
Standard Region
94
Key Note Research
95
The Key Note Range of Reports
96
