High margin categories

While there are plenty of product categories that are essential for convenience stores, there are also a host of unusual products that – if placed right and aimed at the right demographic – can generate footfall, sales and margins.

For stores in tourist areas, selections of tourist gifts can provide selling points that enjoy long shelf-lives and strong margins. For those with a community store, local artisans and producers can provide an interesting and appealing offer.

Identify a demand in your local area not being met and then ensure your store meets that demand. When her village pet shop closed, Trudy Davies from Woosnam & Davies in Llanidloes, Powys, stepped in, selling pet food, leads and collars. She says: “It helps customers because they don’t have to drive 15 miles to the nearest pet shop to get it. And it helps our till as well.”

With her birdseed and her local crafts, she has products that generate impulse and mission purchases.

Avtar ‘Sid’ Sidhu, from St John’s Budgens in Kenilworth, Warwickshire, and Sandeep Bains, from Southern Co-op in Faversham, Kent [VIDEO], have added perfume to their stores’ offer. “Perfume has been one of the two best new additions to my store in the past few years,” says Sidhu. “We have a range for £12 and we’re regularly placing over £1,000 orders. It’s more than 50% margin, so it’s hugely important at the moment. I’ve spoken about it to other stores and now around 100 local shops are doing the same.”

Sidhu also lists Keel Toys’ soft toys and candles as great performing lines he’s introduced. “With gift categories like these, the difference between it looking like it belongs in the store and it looking jarring is in the placement and merchandising. Give it its own bay and treat it like its own concession.

“It really should go next to your cards as well to give the best possible chance,” he says.

Have a little of everything

Dhanesh Amin who runs several stores in Coventry

Dhanesh Amin, who runs several stores in Coventry, has focused on becoming a one-stop store for his customers, not stocking extensive ranges, but having something for everyone.

“We offer cards and giftware and balloons for birthdays – we did helium ones, and that was a plus point for us,” he says. “We do cakes as well, and have an extensive range of toys because there’s no toy shop nearby.”

He also offers kitchen utensils and plates. “We’ve got pots and pans, and tools for around the house.

“We’re quite a big store, so we’ve got space for it. The margins are always good and they always sell in volume.

“We don’t sell high-end stuff, it’s cheap things that appeal to many of our shoppers. It’s only a couple of quid to them, rather than having to spend £10 on actual Tupperware. In the current economy, that could be very significant.”

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Sunder Sandher of One Stop Leamington Spa in Warwickshire

Sunder Sandher, of One Stop Leamington Spa in Warwickshire, took advantage of the obsession with hit Netflix show Squid Game last October to stock plush toys and masks modelled on its striking costumes. “A retailer in my WhatsApp group stated there was a supplier and a few of us talked to them to get in early.”

Getting in buzzy products early has the twofold effect of entrenching customer loyalty, as well as driving sales from new visitors. “Nobody around our area was selling them, and there’s been such big awareness. You get people travelling a few miles to buy these products because nobody else is stocking them, so it’s about getting in early and shouting about it,” he says.

Sandher says it’s vital to view products based on viral trends as temporary and be careful of buying too much, as these products are likely to go out of style almost as rapidly as they rose to prominence.

Toys for the local community

James Wilkinson of Pybus Newsagents in York
James Wilkinson of Pybus Newsagents in York

James Wilkinson, of Pybus Newsagents in York, sells a lot of toys that he sources from Toby, Alpha Toys, House of Puzzles, Orchard Toys and ABGee, although Covid-19 has created supply issues, with goods from China still being held up.

Being based in a market town has meant focusing his offer on his local audience, with farming toys, tractors and the like. This offer, which is showcased in the window, has attracted customers from Doncaster, Leeds, Sheffield and even Middlesbrough.

“We also offer pocket-money toys, as well as cricket bats and tennis sets, sleighs, and buckets and spades,” he says. “In lockdown, we did brilliantly with puzzles and a lot of that has stayed.

“It’s the same with children’s craft sets. We introduced them during Covid-19 and it went really well. Now we’re known for it, it’s stayed as part of our offer.”

Gardening opportunities

Avtar ‘Sid’ Sidhu, from St John’s Budgens in Kenilworth, Warwickshire
Avtar ‘Sid’ Sidhu from St John’s Budgens in Kenilworth, Warwickshire

In a bid to drive further sales, Avtar ‘Sid’ Sidhu, from St John’s Budgens in Kenilworth, Warwickshire, opened up a gardening offer last year. While he closed it for winter, it will be returning in spring.

“Throughout the warmer months the sales are strong and the margins are exceptional,” he says. “It’s a category with curb appeal and it will bring a different type of customer into your store – customers who will spend £50-£60, or even £100.

“It’s not just the plants – the ancillary gardening products are very lucrative. It’s the stakes, the plant wire, pruners, insect sprays, plant feeds, gloves, shovels and compost. They are impulse lines.”

Sidhu also recommends educating a member of staff about the category to help them speak confidently with expert customers, and offering delivery to enable people to buy more than they can carry.

Look to local craftsmen

Cwtch me I'm Welsh sign

Trudy Davies offers small bags of bird and duck food for 50p or £1 in her store Woosnam & Davies in Llanidloes, Powys, which encourages impulse purchases from people who might not want to fork out £10 for a full bag. “We also fill empty milk cartons with birdseed and coffee cups with duck feed,” she says. “It’s a way to upsell.”

With many local artists, craftsmen and authors in her local area, Davies also engenders community spirit and sales by stocking their smaller products, including love spoons, jewellery, pottery, cards and books. “I’ve got a good relationship with the local craft centre,” she says.

“They price it up and I take a 20% margin. We reach out to local authors and if anyone has a book – a town guide, a family history – we’ll sell that. We have a tremendous range of greeting cards, about 10 different outlets for cards. We want to be a hub.”

Coastal stores look to the beach

Heidi Moseley of Village Stores, Aberdyfi, Gwynedd

In the picturesque seaside village of Aberdyfi, Gwynedd, environmentalism and tourism are two defining themes driving the management of Heidi Moseley’s Village Stores shop. “We’re in a very beautiful part of the country, and it really focuses the attention on looking after the environment,” she says.

By stocking crab lines for beachgoing shoppers, Moseley can provide a point of difference and drive additional spend. As the crab lines are recyclable, shoppers, who are often tourists and will have no use for them outside of their time on holiday, return them at the end of the day – and then they’re in the shop for the second time.

“We recycle the crab lines for customers when they’re going home. Tourists buy them for the day and won’t want to take them home, so they’ll come back in on their way home and buy something to take with them.”

Have you thought about beer?

Sandeep Bains, Welcome Faversham, Kent
Sandeep Bains of Welcome Faversham, Kent

As well as selling perfumes in his Welcome Faversham store in Kent, Sandeep Bains has also installed a Beer Hawk Keg machine, which promotes return custom from his clientele.

“It’s doesn’t offer a huge margin, but it helped us boost Christmas sales,” he says. “The machines cost between £230-£240 and each keg is £35-£40. Anyone with machines at home will travel to buy kegs from us, as well as return them.

“It saves them buying them online, which a lot are hesitant to do because it can get lost, arrived damaged, etc. We take that all off their hands and have them bring empty kegs in and return it for them.”

Bains recommends social media – particularly TikTok – as the place to look for the next unusual product. “It started with fidget spinners. Since then, we keep a close eye on TikTok to get the next must-stock product,” he says.

Speak to your customers

Sasi Patel Go Local Extra Manchester
Sasi Patel who owns four stores in Manchester

When one of Sasi Patel’s four Manchester stores underwent an extension, he talked to his customers to find out what non-traditional products they wanted in the extra space.

“After a few months, we got a common theme, which was a ‘bits and bobs’ section – more specifically, kitchen products and hardware,” he says. “We worked with Solvox, and now they merchandise and maintain everything. We sell full utensils, stirrers, storage containers, etc. We then extended this last summer to include in-house party wear that includes serving trays, paper plates and cups, etc. for get-togethers at home.

“I have 1.2-metre dedicated to it and it’s split into three areas: health & beauty, stationery, and general bits and bobs, which include house insulation tape and phone accessories. Having 1.2 metres enabled us to have five shelves, and you can fit a lot of stock in these areas.”

Mark Dudden

Fuel for the fire

Ranj Hayer of Hayers Retail store Weston-super-Mare, Somerset
Ranj Hayer of Hayers Retail store, Weston-super-Mare, Somerset

Ranj Hayer has made use of the space outside his Hayers Retail store in Weston-super-Mare, Somerset, to sell kindling and logs for burning. He gets a good 40% margin from these products, which he sources from a local forestry company and which are usually bought as stress sales by people needing to top up. In summer, he switches to selling barbecue coals, but is considering keeping logs all year round.

“With what’s happening with gas and electric, it could be something that could get quite big in the future,” he says. “And with the weather we’ve had recently as well, it works, too. If people start using log burners year round, it could sell throughout the day.”

Hayer does this because he’s recognised the demand from his local community and recommends being “close enough” to customers to know what they want, suggesting car washing equipment for stores with large car parks.

Specialisation key for mags

Mark Dudden Albany News store in Cardiff
Mark Dudden of Albany News store in Cardiff

Mark Dudden’s Albany News store in Cardiff sells lots of magazines, but while mainstream titles are in decline, he’s seen a growing demand for quality. “People aren’t afraid to pay for it,” he says.

“Specialisation is where the market’s growing. Some people will buy a magazine just to be seen reading it. If you’re in the right area and you’ve got the right range, it will work.”

He doesn’t worry about the top 100 bestselling magazines, which people can get anywhere, but instead focuses on the “bottom 200”. While he sources most of his magazines from Smiths, which gives him a 25% margin, by looking at importers and book wholesalers he can expect a minimum margin of 35%, with opportunities to sell for less but still get a better margin. “It’s easier said than done to get them, though,” he says. “You need to get niche titles and get a name for yourself.”

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