By Kim Stewart
LONDON—Convenience retailers and suppliers gathered last week in London for the 2019 NACS Convenience Summit Europe to share insights and hear from thought leaders on trends and pain points in convenience retailing. From the opening session led by Frank Gleeson, NACS 2018-19 chairman and president, Aramark Northern Europe, it’s clear that European retailers share many of the same concerns that their colleagues across the pond in America do.
In an “around-the-room” session that opened the summit last Wednesday, Gleeson asked the 100-plus convenience retailer and supplier attendees to share what keeps them up at night. Disruption in the industry was top-of-mind, taking the form of competition from online retailers, the digitalization of business, mobile payments, a move away from plastics use to more sustainability—sometimes at the behest of local regulators—government regulations, loyalty programs that work, electric vehicles and autonomous vehicles, a shift toward fresh food retail, declining store foot traffic, consumer privacy, data security and the availability of a high-quality labor force.
“At my count there were 23 issues you raised,” Henry Armour, NACS president and CEO, said, commenting on the concerns attendees shared. Armour offered that he used to say that there were few unique issues across the industry worldwide, but now, “there are no unique issues worldwide.” He encouraged retailers to look at the challenges as opportunities.
Asked what keeps him up at night for the industry, Armour said, “Labor. It’s the fundamental foundation that the industry needs to get right to compete.” The convenience retailing industry is unique, Armour said, because of its relationship with its customers. “The texture of that relationship and getting it right to me is the biggest issue. If you don’t build the business on people and interactions with people, I think you’re just a cat chasing its tail.”
He pointed to a first-time NACS Convenience Summit Europe attendee who operates a single store in London, which Armour visited last year. “His store is not as shiny and bright and cool as others. But go in there at lunchtime and you see the most dedicated customers. It’s because his team interacts with and treats people like people.”
CSE sessions were designed to touch on many of the hot topic issues attendees raised. On Wednesday morning, Mike Watkins, head of retailer and business insight, Nielsen, delved into global macro-trends among c-stores, from sourcing local and differentiating around fresh food to convenience and speed of frictionless checkout to healthy eating at a fair price. “Bigger is not necessarily better,” he said, noting that small stores account for 37% of global FMCG sales and 70% of all shopping trips.
In the session, the “Collision (or Integration?) of Online and Bricks-and-Mortar,” Watkins focused, in particular, on China’s booming c-store landscape. “You could say the East is rising in defining new retail,” he observed. Fresh food is important to Chinese consumers, especially seafood. And China is at the forefront of advanced payment technologies, with consumers paying for their purchases via mobile-phone apps, not credit cards or cash. E-commerce sales already account for 60% of grocery sales in China, he said.
“Convenience stores have a unique advantage,” he said, because “they can actually complement the ecommerce providers, which is a convenient place to collect packages and a convenient place to dine.”
Technology is not only changing how people discover products, but it also fundamentally changes what’s happening inside the store. “I do see that the online and convenience models have converged,” Watkins said. “There’s great potential for convenience stores to grow sales on the back of building customer loyalty and extending it to the online world.”
The NACS Convenience Summit Europe is a three-day international event that features thought leadership from European and global speakers, expert-guided retail tours and opportunities to build strategic relationships with leading retailers around the globe. Look for more coverage of this dynamic event in the NACS Daily all this week.