The 63 key decision makers in the HBC and general merchandise segment identified BIC Corp., Lil’ Drug Store Products Inc. and Novelty Inc. as the category’s top performers. Honorable Mentions include Convenience Valet and Procter & Gamble.
Representing approximately 9,500 stores, the chains tallied $208 million in category sales last year.
BIC’s selection as a top performer is no doubt attributed to how hard the company works to educate retailers on the long-term profitability of the lighters and the need for retailers to sell safe products to avoid costly liability issues. BIC estimates that more than 60% of all lighters are sold in c-stores with its products representing seven of the top 10 lighter SKUs.
On the general merchandise side, Lil’ Drug Store, Novelty Inc., Convenience Valet and Procter & Gamble all provide a valuable niche for retailers that market the store for specific occasions.
For example, the influx of summer tourism is a boon for many operators. That’s why adjusting store sets to meet vacationers’ last minute needs has proved to be a winning strategy for both health and beauty items and general merchandise. Retailers report that while HBC category sales typically holds its own for the first part of the year, it spikes in profitability during the spring and summer.
"Regular everyday folks are getting out more this time of year," said Terry Taylor, director of marketing for Spinx. "Traffic counts pick up and we have more opportunities to sell."
Nice N Easy Grocery Shoppes in Canastota, N.Y., typically carries a number of seasonal summer items for customers visiting nearby lakes or beaches. A summer essential, sunscreen, is expanded with counter units or secondary displays to accommodate the increased demand.
"We are not so much introducing seasonal items as we are increasing the inventory on the items purchased more frequently and in greater quantity during the summer," said Jared Sturtevant, buyer for Nice N Easy.
Retailers along the East Coast are particularly susceptible to summer traffic, with mountain and beach destination spots readily accessible. Because of Nice N Easy’s upstate New York location, they "are greatly impacted by the weather. When summer comes, we are well-prepared and have the sales to justify the inventory," said Sturtevant.
Stores situated in warmer year-round climates, such as Spinx, see more interstate and local travelers than beach-goers. Taylor notes his stores’ HBC category relies heavily on customers who pick up single doses of aspirin or allergy medicine, while suntan lotion is in less demand.
"We have the same customer base during the summer, but pick up additional traffic from vacationing travelers," said Taylor. "It varies immensely depending on the location of the store."
Anticipating increased traffic is a key to success. Retailers report they are prominently positioning more "hot" seasonal items from the general merchandise since it tends to carry higher margins. Picnic supplies, beach toys and water can introduce a seasonal mix, launching warm weather promotions.
Increased promotions from other categories can boost sales of HBC products. When customers come in to buy water for the beach, they may realize they’ve forgotten sunglasses or lotion, thus increasing the potential for add-on HBC sales.
"While we ramp up our inventory of Gatorade, ice and multi-pack soft drinks, our customers will stop by the HBC section to pick up an essential item or two," said Taylor. "All seasonal promotions have a carryover effect."