When they have a hungry baby on their hands and have ran out of milk, shoppers are happy to pay the price for baby formula on their doorstep, which explains why independents are making extra profits in the category.
The multiples beat the average price and Booker’s RRP on every single line, but shoppers are in a completely different mindset when they are in a convenience store. This is the sort of category for which they are not price-sensitive.
Baby care is an often-forgotten category in convenience, but retailers who approach it in a meaningful way have the best chance of earning loyal shoppers. If you stock the essentials for a newborn baby, and get parents coming to your store for all their requirements from day one, then you can win their custom for the duration, and, of course, parents may also use your store for their own top-up and weekly needs, too.
|Product||Average||Booker RRP||LOCAL SHOP IN NEWCASTLE RESIDENTIAL SUBURB||LARGE C-STORE IN SOUTH WALES VILLAGE||C-STORE AND OFF LICENCE ON OUTSKIRTS OF WOLVERHAMPTON||POST OFFICE AND LOCAL SHOP IN BRADFORD SUBURB||BRADFORD SUBURBAN POST OFFICE AND SHOP||HIGH STREET OFF LICENCE AND C-STORE IN NORTH LONDON SUBURB|
|COW & GATE 1 FIRST MILK POWDER 800G||£9.87||£9.29||£10.99||£10.99||£10.99||£9.79||£10.99||–|
|COW & GATE FOLLOW ON MILK 2 FROM 6 TO 12 MONTHS 800G||£9.94||£9.79||–||£10.99||£10.99||£9.29||£10.99||£11.99|
|COW & GATE MILK POWDER FOR HUNGRIER BABIES 800G||£9.83||£9.29||£9.29||£10.99||£9.29||£9.79||£10.99||–|
|SMA PRO FIRST INFANT MILK 800G||£11.40||£10.99||£12.49||£10.99||£11.99||–||£11.49||£12.49|
|COW & GATE FIRST INFANT MILK FROM BIRTH 200ML||£0.90||£0.89||£0.89||£0.89||£0.89||£0.89||–||£0.99|
|COW & GATE FOLLOW ON FROM 6 MONTHS 200ML||£0.91||£0.89||£0.89||£0.89||£0.89||£0.89||£0.99||£0.99|
|COW & GATE READY TO FEED MILK FOR HUNGRIER BABIES 200ML||£0.92||£0.89||£0.89||£0.89||£0.89||£0.89||£0.99||£0.99|
|COW & GATE FOLLOW ON INFANT MILK FROM 6 MONTHS 800G||£10.57||£9.29||£10.99||–||£10.99||–||£10.99||–|
|COW & GATE PREMIUM BABY MILK BIRTH TO 6 MONTHS 800G||£10.44||–||–||–||£10.99||£9.99||–||£11.99|
|APTAMIL FOLLOW ON MILK 800G||£11.81||£11.99||–||–||–||–||–||–|
|COW & GATE 3 GROWING UP MILK 1 TO 2 YEARS 900G||£10.61||£9.99||–||–||£10.99||–||£10.99||£11.99|
|APTAMIL 1 FROM BIRTH MILK 900G||£12.11||–||–||–||–||£11.99||–||–|
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Drive your profits
Londis Bexley Park
Location: Dartford, Kent
Size: 1,800sq ft
Type: residential Top Tip Offer a streamlined range that focuses on the bestsellers in the category We stick to the RRP because formula is already expensive without raising the price of it. Aptamil is a bestseller for us, and we stock the powder and liquid pre-made cartons. We used to offer SMA, too, but we got rid of it when we decided to streamline our range. I find people come to us for the formula because we’re the closest store to them, and prices are pretty much the same if they were going to buy it elsewhere. The baby care category has definitely increased in the past few years, as has the formula segment.
Cranhill Convenience Store
Size: 2,900sq ft
Type: residential Top Tip Offer a wide variety of baby formula from best-selling brands We were a Premier store until recently and used to stick to RRP. Around two weeks ago, we became a One Stop and this has dramatically increased our range from a small section to 12 shelves of formula. Cow & Gate is the best-selling brand, and prices on average are around £8.25. There are lots of parents and children nearby, and I’m hoping our larger offering will boost sales. I find shoppers prefer to come to local stores rather than go to multiples for baby formula because we are closer and offer the same prices.
Size: 1,700sq ft
Type: estate Top Tip Focus on the bestsellers and core lines in the category In the baby formula category we stick to the RRP set by Premier, our symbol group. This offers us the best margins – although, they could always be better. At the moment, margins sit around the 25% mark. If they are on promotion, it’ll normally be around 20p or 30p off the price, rather than multi-buy deals. SMA is a bestseller for us and we’ve always stocked that. I find that people don’t come in necessarily for baby formula, but they’ll pick it up as part of their shop. We have a pharmacy opposite us that sells things like this, but it still pays to stock it.
One Stop Working with Woodcross
Location: Dudley, West Midlands
Size: 850sq ft
Type: residential Top Tip Make sure everything is as visible as possible and follow planograms for help We recently became a One Stop, which means our prices are set for us. We normally aim for a 25% margin in the baby care category and, through the symbol group, we usually have some sort of promotion. We’ve been with One Stop for around four weeks now, and the promotions change every two weeks or so. At the moment, Cow & Gate is definitely the bestseller, and we’ve recently introduced SMA formula as well. The category is definitely growing and is worth investing in as more shoppers look to buy formula.