Value is Key to HBC

In the HBC category, miscellaneous health remedies brought in $74,935,760 in dollar sales, a 4% decline from the previous year according to Information Resources Inc. (IRI) data for the 52 weeks ended Dec. 27, 2009. Meanwhile the cold allergy and sinus liquids and tablets were down 11.6% for the same period.

“We’re seeing increases in more customers medicating themselves, as opposed to going to the doctor, and they’re choosing smaller doses and less expensive immediate-use type products,” said Kris Nelson, senior product director for nonfoods merchandise, at Dallas-based 7-Eleven Inc. 

Roger Leonard, general manager for Janesville, Wis.-based Lions Quick Marts, noted that after ephedrine-based products drove the category upward in 2008, now HBC has been declining at his stores because of the soaring price of ephedrine.

“The price went through the roof on that product and doubled a lot of the costs,” he said. “Lawmakers are focusing regulatory costs on the product to protect it from improper use and suppliers across the board are being forced to raise prices. We were down 7% in the category in 2009 versus 2008.” 

Both Lions Food Marts and 7-Eleven noted that hand sanitizer has seen increased consumer demand. The trend is expected to continue in 2010 as more gels, sprays and wipes appear on the market.

As for the beauty segment, 7-Eleven is reaching female customers looking for value by testing a proprietary product called Beauty.Me at 30 stores around the country this spring. The stores will feature a three-foot section of beauty care items— from lipstick to hair accessories to body lotion—targeted to women in their teens to early 30s. “Store brand cosmetics are expected to grown to double their size in the next year or two. Stripped of the expenses of advertising costs we are able to offer similar quality products as the major brands under our proprietary brand at a greater value,” Nelson noted. n


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