Operation Remerch: soft drinks

The latest category to be overhauled part of our Operation Remerch strategy to remerchandise the entire store saw us tackle the hugely important soft drinks category.

by Antony Begley

Operation Remerch – our project to remerchandise the entire store is now well underway and the latest category to get the treatment is the soft drinks category.

As in most convenience stores, soft drinks are massively important to Woodlands Local. Soft drinks is in fact the biggest selling category in the store by volume so it’s extremely important that we take regular fresh views of the category.

Over the months and years we have, like most stores, managed to gather a far wider array of products than is optimal. Range proliferation is a real problem as new lines have a curious habit of finding their way into the chiller: through free stock or samples from suppliers, from pushy sales reps, from inaccurate deliveries and more. Once a product is on the shelf, our re-ordering processes currently ensure that it’s unlikely they’ll be identified and delisted quickly.

The process

So the process began with running 12 months of EPoS numbers giving us a good, broad view of the category sales. We then overlaid data about promotional sales (which skew the overall sales figures) and data about when any products were introduced over the last 12 months. This allowed us to gain a half decent picture of which products are doing well and which less so.

That done, we drew a figurative line in the sand and decided to delist everything with a lower rate of sale than approximately a case a month. That meant we had to delist in excess of 50 SKUs!

We ran our usual sense-checks for each delisted product to ensure it didn’t regularly appear in unusually high basket spends but found once again that none of the delisted products was in any way unusual.

In order to get rid of many basket loads of delisted stock we have created a temporary ‘clearing’ shelf in one fridge to sell the delisted lines through at a 50% discount. We anticipate that all delisted stock will be gone within a couple of weeks. What remains is stock that we know for sure has proven its worth and has very solid rates of sale.

Merchandising

Next we decided how the category should be remerchandised in our chillers. Nothing too clever here. With one large dairy deck and one double door chiller for soft drinks, we packed the dairy deck full of the biggest selling, bigger ticket brands. We did retain some cheaper brands with much lower margins but shifted them into the farthest away corner of the doored chiller. If our customers are desperate for low margin products then we’ve made them work to find them.

Within the main dairy deck we now have energy drinks top shelf (highly visible but not within the reach of kids), colas and fruit flavoured carbs on the eye level shelves (the Coke and Irn-Bru family of products) then a full shelf of our best-selling Lucozade lines.

Below that we have larger format packs of our most popular lines.

Within each of these sections we’ve hugely increased the space for our very top selling lines like Irn-Bru, Coke and Red Bull. Not only does this make the products more impactful for customers, it also makes keeping the fixture well stocked much easier. There’s now room to put entire cases of these products on shelf in one go which means a tidier stock room and a quicker replenishment procedure.

In the closed door chiller we have added the kids drinks (Fruit Shoot), the fruity drinks (Ribena, Vimto, Oasis) and the plain and flavoured waters on the right hand side with the sports drinks on the left hand side.

The plan is very straightforward but we’re hoping to see an increase in sales volumes and, more importantly, an increase in cash margins.