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Most retailers are THINKING they should win. Many are actually PLANNING to win. However, when you look in the stores, few are really PLAYING to win in retailer foodservice.
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March 31, 2011
Copyright © 2011 Balvor LLC. All Rights Reserved.
117 South Cook Street #339
Barrington, Illinois 60010
phone: 847.722.2732
fax: 847.382.1801
davidbishop@balvor.com
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ARE YOU PLAYING TO WIN IN FOODSERVICE?
Copyright © 2011 Balvor LLC. All Rights Reserved. 2
To win in foodservice requires you to demonstrate that you deserve to be on the “A” team, but…
Copyright © 2011 Balvor LLC. All Rights Reserved.
2.2x
1.0x
0.3x
Top Quartile Survey Average Bottom Quartile
Average Foodservice Sales per Store Index
3
…It’s clear that many retailers still have a lot of work to get on the “A” team and …
*Includes all dispensed beverages, food prepared on-site, and commissary & other packaged products.Source: CSD/Balvor 2011 Foodservice Outlook Survey, Balvor LLC, January 2011.
Copyright © 2011 Balvor LLC. All Rights Reserved.
1.7x
1.0x
0.6x
Top Quartile Survey Average Bottom Quartile
2010 Foodservice Dollar Sales Growth Index
4
…Making the cut is only becoming more difficult as the “A” team players are getting stronger
*Includes all dispensed beverages, food prepared on-site, and commissary & other packaged products.Source: CSD/Balvor 2011 Foodservice Outlook Survey, Balvor LLC, January 2011.
Copyright © 2011 Balvor LLC. All Rights Reserved.
So, where do you need to strengthen your game first to improve the chances of winning?
Food Prepared On-Site
58%
Hot Dispensed Beverages
21%
Commissary & Other Packaged
Products 7%
Cold Dispensed Beverages
8%
Frozen Dispensed Beverages
7%
5
Source: NACS SOI Annual Report, 2009 data.
Share of foodservice dollar sales
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85%
0% 5%10%
38%
33%
15% 15%
Morning (6am - 10am) Mid-day (10am - 2pm) Afternoon (2pm - 6pm) Evening (6pm - 10pm)
Hot Dispensed Beverages Food Prepared On-Site
6
Focus on improving execution in the core day-parts before attempting to build other segments
Q: Which of the major day-parts offers the most growth potential for each foodservice category respectively in your store(s)? Percent of retailers responding.Source: CSD/Balvor 2011 Foodservice Outlook Survey, Balvor LLC, January 2011.
Copyright © 2011 Balvor LLC. All Rights Reserved. 7
Help get consumers to spend money in your store(s) by taking some pressure off their wallets
129
95
75
Top Quartile Mid Quartiles Bottom Quartile
Hot Dispensed Beverages Index
Q: Have you introduced any new products in the past 12 months that enable your store(s) to offer lower retail prices?Source: CSD/Balvor Foodservice Survey, Balvor LLC, May 2010.
Copyright © 2011 Balvor LLC. All Rights Reserved. 8
Think differently about how products are described on your in-store menu boards
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Enhance the shopper experience around the coffee bar with new and/or improved equipment
134
102
63
Top Quartile Mid Quartiles Bottom Quartile
Retailers Likely to upgrade hot dispensed beverage equipment-Index
Q: In terms of dispensed beverages, which areas will your company likely test or implement in 2011?Source: CSD/Balvor Foodservice Survey, Balvor LLC, May 2010.
Copyright © 2011 Balvor LLC. All Rights Reserved. 10
Leverage more combo deals to build transaction size –especially during the morning day-parts
121
96
83
Top Quartile Mid Quartiles Bottom Quartile
Retailers Changing Quarterly or Monthly - Index
Q: How frequently do you change foodservice-related combo deals in your store(s), e.g., buy a beverage and a food item and save $$?Source: CSD/Balvor Foodservice Survey, Balvor LLC, May 2010.
Copyright © 2011 Balvor LLC. All Rights Reserved.
108 105
82
Top Quartile Mid Quartiles Bottom Quartile
Retailers Using with Hot Dispensed Beverages- Index
159
121
0
Top Quartile Mid Quartiles Bottom Quartile
Retailers Using with Food Prepared On-Site- Index
11
Reward purchase frequency from your store with special product deals
Q: Do you offer a club program in any of the following categories, e.g., buy 5 and get your 6th free?Source: CSD/Balvor Foodservice Survey, Balvor LLC, May 2010.
Copyright © 2011 Balvor LLC. All Rights Reserved. 12
Drive more customer traffic into store by promoting Food Prepared On-Site at fuel pumps
129
102
65
Top Quartile Mid Quartiles Bottom Quartile
Retailers Using Monthly with Food Prepared On-Site- Index
Q: How frequently do you leverage signage at the fuel pump to promote special deals or products available in-store?Source: CSD/Balvor Foodservice Survey, Balvor LLC, May 2010.
Copyright © 2011 Balvor LLC. All Rights Reserved. 13
Be sure to refine the offering at times in order to satisfy the consumers’ changing preferences
167
96
50
Top Quartile Mid Quartiles Bottom Quartile
Percent of Retailers Changing Type of Brand Offered In or Since 2009 - Roller Grill Products* - Index
* Based on retailers selling.Source: CSD/Balvor 2011 Foodservice Outlook Survey, Balvor LLC, January 2011.
Type of Brands
• Proprietary / Store
• Manufacturer
• Wholesale / Control
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11%
32%
50%
11%
11%
25%
67%
55%
25%
11%
3%
Bottom Quartile
Survey Average
Top Quartile
Percent of Retailers Employing as Dominant Branding Strategy –Roller Grill Products*
Proprietary/Self Branded Franchise/License Branded Manufacturer Branded Wholesaler/Control Branded
14
Select the branding strategy that’s best for your store today and realize this may evolve over time
* Based on retailers selling.Source: CSD/Balvor 2011 Foodservice Outlook Survey, Balvor LLC, January 2011.
Copyright © 2011 Balvor LLC. All Rights Reserved.
11.7%
10.0%
9.2% 9.0%
4.2%
8.3%
Food Prepared On-Site Hot Dispensed Beverages
2011 Sales Forecast - PCYA
Top Quartile Survey Average Bottom Quartile
15
* Sales weighted based on the number of stores operated. Source: CSD/Balvor 2011 Foodservice Outlook Survey, Balvor LLC, January 2011.
Wining in foodservice means improving your game in order to compete against “A” team operators
Copyright © 2011 Balvor LLC. All Rights Reserved. 16
Public Accomplishments
White Papers
• Convenience Channel Opportunity: Insights for the Dairy Industry, Dairy Management Inc., 2010.
• Are Retailers Doing Enough? Preventing Underage Access to Tobacco at Retail, Center for Responsible Tobacco Retailing, Inc., 2009.
• Accelerating Cigar Profits Through an Increased Strategic Focus, John Middleton Inc., 2008.
• How to Succeed in Convenience Retail:A Practical Guide for Product Suppliers, NACS, 2007.
Industry Research
• State of Foodservice, Convenience Store Decisions, 2008 - 2011.
• Tobacco Retail Survey, Convenience Store News, 2008 – 2011.
• SKU Rationalization Survey, NACS/Balvor, March 2010.
• Motor Fuels Retailer Survey, Balvor/NACS, January 2010.
Current Industry Affiliations
• Convention and Events Committee, NACS, 2007 – present
• Supplier Advisory Board, Convenience Store Decisions, 2006 – present
• NACSPAC Member, 2008 - present
Biography
David is the managing partner of Balvor LLC, which is a sales and marketing firm that provides consulting, sales support, research, and analytic services to retailers, product suppliers, financial analyst and other organizations.
Balvor’s services support various food channels, covering both foodservice and retail classes of trade.
David has helped many leading retailers evaluate new retail concepts, enhance annual category planning processes, and develop new business support methods related to assortment rationalization, space allocations, or branding strategies.
He helps product suppliers improve their competitive positioning, trade programs, and category management capabilities by better understanding what retailers’ value while also benchmarking versus peer companies.
David also has extensive experience with activity-based costing, channel sales strategy, merchandising assessments, trade communication, and custom analytical support for both consumer packaged goods and foodservice industries.
Prior to founding Balvor in 2008, David spent 12 years at Willard Bishop in various positions, including most recently as partner. David began his career with The Levy Restaurants in operations for new store concepts where he focused on beverage and financial programs.
David Bishop Managing Partner, Balvor LLC
P: 847.722.2732
davidbishop@balvor.com
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