designing a retail strategy

Keeping a close eye on competitors, and an even closer eye on the changing needs of customers, is the key to becoming a destination.

The late ’90s brought a lot of changes to Bill Gordy’s Delmar, DE-based convenience store business. As he witnessed the beverage category explode with the introduction of new SKUs, he saw major chains like Wawa and Sheetz eyeing his territory.

Gordy’s stores had been servicing the Salisbury, MD area for years, but theyweren’t big enough to house an expansive product assortment that would allowhim to compete with the mammoth stores his new competitors were opening. Atthe time, Gordy had seven Tiger Marts branded Exxon or Mobil. He decided firstto cut the fat by eliminating three underperforming stores and focus on makingthe remaining four more efficient, customer friendly and profitable. The nextmove was to capitalize on the strengths he already had—namely, the BeerCave.

“Our stores ran from 1,400 to 2,000 sq. ft., but we knew we needed bigger, better stores with competitors like Wawa and Sheetz coming in,” says Gordy, president of Gordy Fuels. “We remodeled two of our larger stores and demolished the other two and began creating a larger core ranging from 4,200 to 6,200 sq. ft., with the Beer Cave as a focal point.”

Before his competitors could begin building their own Beer Caves, Gordy trademarked the name in Maryland and registered it in Delaware so no one else could use it.

With the help of an outside design team from Fort Worth, TX-based Paragon/Solutions,Gordy created stores with an open, airy feeling, incorporating full glass fronts,atrium entranceways, skylights and airbrushed treatments of skies on the ceilings.He then used stone fronts to give the beer offer its cave-like feel, and integratedautomatic doors to make it easier for customers to shop.

The doors opened at Gordy’s first new store in January 2000, after an average investment of $1.3 million per store. Giving the stores time to meet their peak profit potential, he has seen the investments generate a good return because he’s been able to stand up to larger competitors.

“It takes about 24 to 36 months to bring a store up to its top growth potential,”says Gordy. “But as our competitors have come in, we’ve experienced phenomenalgrowth in our gas volumes and inside sales. We’ve leveraged that we’re ‘TheOriginal Beer Cave’ in all of our stores and the results speak for themselves.”Gordy’s four stores average 4.4 million gallons per store and inside sales average$2.2 million. Five years ago, those same store sales were about $780,000. Thebiggest growth for Gordy was in his beer sales. He credits the Beer Cave designfor increasing the category by 500% over a six-year period in his stores.

Image is everything
Nice N Easy (Canastota, NY) found that the ruralcommunities it services in upstate New York have strong opinions about the storeslooking to build on their streets, but the chain is hearing no complaints aboutits desires to grow. In fact, in many cases, it’s been invited to join the neighborhood.

The chain had worked through an interior upgrade while developing a new exteriorlook for its stores at its Manlius, NY site (see Nice N Easy’s New Face,February ’05, p. 30). The store has become its flagship—giving upstateNew York communities a glimpse of the Nice N Easy they can expect, and theyapparently like what they see. According to company President and CEO John MacDougall,it all comes down to flexibility.

“The ultimate success story of our new look is that we’re being recruited bycommunities that are putting their foot down to other companies looking to comein,” says MacDougall. “The new look of our Manlius store has really opened theireyes. But we’ve also been able to adapt to communities.”

Nice N Easy took its Manlius design and adapted it to a store it was recruitedto build in the North Country. The community wanted an Adirondack feeling—stainedwood with greens and soft browns— something that would blend into thelocale.

“The store opened just two days before Christmas and the response has been fantastic,” MacDougall says. “As we develop more of these specialized stores, we get more calls from communities asking us to come in.”

Nice N Easy recruited the help of New York design firm Group Red to give itsgraphics package a fine-tuning that, in turn, has almost become its callingcard. The areas above the coolers, foodservice and coffee offers incorporateportions of the New York state map that the chain can adapt to stores’ individualcommunities, and the chain has opted for verbiage that MacDougall believes isthe next evolution of getting the message across.

“Our graphics have messages like ‘Proud of our products and people’ and ‘Brighten your day’ rather than the typical ‘Beer’ and ‘Soda,'” he says. “They send a different message. The way neon had become popular years ago, this is the next transformation— colors are bright and messages that aren’t dated.”

And the graphics package just isn’t a feature for the inside of the store.Because Nice N Easy chose not to include its vendors in the redesign—opting not to ask for their opinions or financial support—they have aneven cleaner, clearer image of the store from the outside in.

“A lot of companies are dependent on vendor contributions when looking to makechanges,” MacDougall continued. “We didn’t ask for a dime or for any input,which is an important differentiation for us. Our stores don’t even featureNice N Easy promotions on their walls—it’s an aesthetic measure. Withoutall that clutter, our internal graphics package leaps out all the way to thestreet in stores with full glass fronts.”

The company has also made a shift to its own proprietary gas brand where possible, carried on the strength of the Nice N Easy brand and its colorful logo.

“We used to feel compelled to have some sort of name for our gas so we worked with a couple options,” says MacDougall. “But as we opened new stores we wanted everything to be Nice N Easy. Having a proven gas identity is unnecessary if you have a strong brand of your own.

“Ten years from now,” he continues, “I believe the companies that will stillbe around will be the folks that recognize the importance of their own nameand logo and what it represents to the communities they serve.”

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