Garage forecourt retailers are having to be increasingly innovative with their merchandising and sales strategies to remain competitive and meet the growing demand by consumers for value-added convenience, says BMi Research CEO, Gareth Pearson. "Forecourt retailing is an ultra-competitive channel, which has experienced high growth in the past, but the economic environment and changing retail landscape is having a significant influence on where people shop and what they buy," he said.
"Consumers are looking for value as well as convenience and good deals such as the combination of a pie with a soft drink or a two-for-the-price-of-one offer are becoming more and more important in driving volumes and maintaining category value.
"Garage forecourts have traditionally been less price-sensitive than other retail channels, but persisting economic pressures have taken a toll on volumes and players have been forced to rethink how they encourage sales. Forecourt retailing caters for impulse spending rather than planned shopping and special offers not only encourage sales, they also appeal to the customers' quest for value."
Further proof of consumer demand for value was the research's finding that some manufacturers had also increased their pack sizes, eg in the flavoured milk category, which indicated that consumers were bulk buying for at-home use rather than purchasing premium priced on-the-go convenience packs.
Internationally, larger mass-market retailers were viewing garage forecourts as strategic growth opportunities. "In South Africa, the partnerships between major retailers such as Pick 'n Pay, Woolworths and Food Lovers Market and oil companies will drive further innovation to meet evolving customer needs and the forecourts channel is expected to grow as the global economic outlook improves," he concludes.
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