August 2009

Eurospar Sheffield: largest store to date	Real deals: strong promotional calendar
Large seating area alongside food-to-go counter	Pounds down displays
In-store bakery	Eurospar Broomhill: student and affluent demographic

Both the Sheffield and Nottingham Eurospar stores are former Somerfield outlets, acquired from the Co-operative following its takeover of Somerfield.

The Sheffield store is located in an inner city location in an area called Broomhill. It has an affluent demographic - the area is dominated by two major hospitals and Sheffield University.

According to Tates, 50% of households within 400m of the store are occupied by students, while 51% of the local population occupies large houses and is affluent.

Tates has invested £1m in the new format, which has the largest food-to-go area within the Spar estate plus in-store seating and plasma TV screens.

The Eurospar store is around three times the size of the average Spar store and stocks 6,000 skus versus the average of 3,000 skus.

According to Dennis Evans, managing director at AF Blakemore, one of the biggest challenges was range.

Evans says all 6,000 skus in the Eurospar store are available from the AF Blakemore warehouse and it has geared up to providing bigger ranges for bigger stores.

“It will blow your mind what the full Spar range is and the amount of fresh and chilled in the business,” he says.

Spar’s recent investment and relaunch of its own label range has been crucial in developing Eurospar in England, according to Ged Carter, marketing director at AF Blakemore.

“If Spar had not made improvements on own label in the last six months, it would have been harder to develop Eurospar supermarkets,” he told Global Convenience Store Focus.

“Own label has been a bit of an achilles’ heel for Spar. The multiples have trained shoppers to expect to see ranges in a particular way and for stores to offer a broad and high quality, contemporary-feeling own label range.

“Our new own label team is pushing fresh ranges - it’s a test for any retailer but it is a real step on for us and we are encouraging all retailers to stock and support as much of the fresh own label range as possible. Consumers expect it to be part of the shopping mix, even in convenience.”

Carter says future development of Eurospar stores would help drive the volume required for some of the more unusual and esoteric lines.

“Growth in larger stores will support volumes on more specialist and niche short life own labels,” he said.

The Sheffield store targets its demographic well - the strong emphasis on food-to-go, including hot meals, savouries, breakfast sizzlers, hot subs and baguettes, an Italian-inspired range, salads and wraps, appeals to students.

“They are the areas they like and take to instantly in a shop,” says Evans.

Similarly, the store offers a large Indian range and two dedicated bays of Chinese products.

Local lines including Sheffield’s own Cunningham’s pickles,Yorkshire Crisps and Curtis of Lincolnshire cakes are new introductions and a fresh area of development.

Evans says: “We had a look at what Somerfield do and there is nothing on a local basis. We can react in a smaller way than the multiples can and it fits in with the community.”

Elsewhere, Evans reveals the retailer’s category team has developed full planogram ranges for the stores structured around a good, better, best proposition. In pasta, for example, the Spar brand is good, Napolina is better and Garofalo is best.

As well as range development, the larger format Eurospar store is taking Spar’s promotional strategy to new heights.

Since the former Somerfield store relied on promotions for over 40% of its sales, Spar has added 100 promotions to its typical range of 200 promotions per period. According to Evans, these are mostly “two for...s”. In addition, the retailer is investing in a lot more pound deals.

“Tates has invested in sharper deals to drive footfall through the store and there is a pricing band just for Eurospar,” he says.

Evans adds Spar has looked at Somerfield and Co-operative pricing and chosen the cheapest price for its offer.

“We are trying to strike a better balance,” he says. “There are a lot more deals than normal for Spar, and there is a better pricing structure in store.

“We don’t have as many promotions as Somerfield but we think we’ve done it better - everything you look at shouts ‘deal’.”

In addition, Tates has studied the products, which Somerfield sold well. As a result, point-of-sale stating, ‘You asked for this, so we brought it in’, is dotted around the store.

Sheffield and Nottingham will shortly be joined by two further Eurospars in Wales, operated by the award-winning Spar Pwllheli retailer, Conrad Davies. The stores, both formerly Somerfield supermarkets, are scheduled to open in late August and September.

Carter is relishing the opportunity. “They will be owned by an independent retailer with skill and panache. They were previously Somerfield stores but there is nothing Welsh about them. Conrad Davies is a premium local retailer with great network of supplier relationships and offers quality, local Welsh products. When the doors open as Eurospar they will feature local butchery with all Welsh meat, local seafood and a fantastic array of local food and bakery suppliers.

“A lot of people will be quite nervous about what’s going to happen but I think they are going to be delighted.”

Eurospar ticks the box for future development too.

“We believe there is going to be significant potential for Spar to develop in this Eurospar supermarket area,” says Carter. “Up until now, we have not offered independent retailers a supermarket format with fully ranged promotional and planogram support.

“Now we have got into the market and can show we can do it, it is a fantastic showcase to potential retailers and provides an opportunity for retail recruitment that previously has not been open to us before.”

Carter reports the business is recruiting retailers at the rate of one a week currently. “We are getting a lot interest,” he says. “It’s because people recognise that Spar and Blakemores are showing lots of improvements and keeping up with developments like Eurospar.

“We’ve had a good start to the financial year on the recruitment front,” he says.

Critically, Eurospar fits in with current trends for top-up shopping.

“Everybody has access to a superstore if they have a car,” says Carter. “But if you want to shop locally, a more mid-sized store adds to the set of choices for a smaller basket shop.

“Most European countries have Eurospar. There’s no barrrier that says Spar can’t do supermarkets, and now we’ve brought it to the mainland.”

Watch the Eurospar space.