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Pick n Pay, a leading supermarket and hypermarket retailer in South Africa, launched into the convenience forecourt arena in December 2008 with two stores under the banner, Pick n Pay Express.
Developed in a joint venture with BP, the new format is designed to drive and lead market growth.
Pick n Pay Express: smart exterior design
Entry into the forecourt space provides Pick n Pay with multiple and shopping mission reach, servicing large scale, top-up and impulse trips.
But the new format is differentiated from the traditional forecourt model because the site franchise is owned by Pick n Pay and it has autonomy over store operations. BP simply operates as the landlord and fuel supplier.
According to Pick n Pay, this arrangement optimises both businesses areas of core competency.
The new format features a modern external design to attract attention and encourage trial.
Inside, crisp lines and imagery create a sense of space and cleanliness, which shoppers appreciate.
Pick n Pay has also invested in impactful advertising to promote its differentiated product offer and highlight aspects such as freshness and 24/7 opening.
The store layout has been optimised with separate entry and exit points to create a natural flow through the store. Product adjacencies have been maximsed to make it easy for shoppers to find what they need and prompt impulse purchases. A queuing system has also been introduced to speed up exit times.
An extended range is giving the Express format real competitive advantage too. As well as incorporating and developing BP’s Wild Bean concept, Pick n Pay’s range of fresh foods and convenience meals have been introduced. This is a significant departure from the traditional forecourt offering and has proven to be a major draw.
Technological innovations: electronic shelf edge labels
“Our ability to offer an extended range of grocery lines is a key source of competitive advantage, providing the ultimate in top-up convenience and emergency solutions,” says Pick n Pay.
The range comprises 1,700 lines versus the forecourt average of 1,000 to 1,200.
“The higher than average representation of private label lines delivers enhanced shopper value while further strengthening our brand equity,” it says.
Pick n Pay has introduced technological innovations too.
Electronic shelf edge labels have been implemented to ensure pricing accuracy and streamline price changes. Electronic tagging of higher value items has been introduced to reduce shrinkage. The stores are live on SAP to optimise performance and stock is purchased through Pick n Pay via an efficient ‘pick from store’ supply chain.
Customer service is a cornerstone of the Pick n Pay brand and it has remained a priority with the new format. All Express store staff attended training course developed for the retailer’s supermarket and hypermarket employees, while BP included the two stores in its mystery shopping programme to positive effect.
Corporate social responsibility extends into convenience forecourt retailing as well. Cash donations were made to local charities at the stores’ opening and donations of expiring stock are made daily. Support for community projects and charities is also ongoing. In addition, the sites have been developed as recycling stations for the local community.
Since opening the store sales are tracking well ahead of the 2008 benchmark and the industry as a whole. Fuel sales reflect a similar trend, indicating increased forecourt traffic.
Innovative JV with BP on the forecourt
Pick n Pay reports there is a strong participation in fresh foods, convenience meals, Wild Bean and bakery sales, which have benefited the margin. A strong participation in groceries is a reflection of the company’s retail expertise too.
Shopper research confirms the new stores’ appeal. Both pilot outlets are attracting shoppers who do not shop at other Pick n Pay stores and they are attracting repeat business, becoming a planned destination for shoppers to the forecourt.
On the back of the initial results, Pick n Pay is developing additional pilot stores.
“A meaningful results platform will be developed from which we will evaluate performance and the long term profitable growth potential,” it says.
In terms of a national roll out, a post-pilot review is scheduled with BP in March 2010 when plans to roll out the format nationally be finalised.
Pick n Pay reports potential for standalone sites will also be explored next year.
It looks like Pick n Pay Express has legs.
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Award program sponsored by Airplay and Imperial Tobacco |