I can't seem to turn a corner these days without seeing a newly-opened convenience store. They are all over my neck of the woods: it started with the Co-ops and Tesco Expresses, but now a whole army of independents have opened - even my local pizza takeaway shop has recently converted to a c-store - with names such as All In Here, Nice One, Well Done, and my personal favourite, Buy 2 Win.
Nationally, independent convenience store numbers are declining, according to latest research by the Institute of Grocery Distribution. It says they are being pushed out of the market - or into the clutches of symbol groups - by growing competition and a rise in standards in the sector.
Meanwhile supermarkets' convenience chains are thriving. Their 1,714 shops account for over half the multiple convenience stores in the UK, and with well-designed layouts and a sales share disproportionate to their size (see box) it is no surprise they want to expand these smaller offerings.
Specialist off-licence chains are also exploring this part of the market. After a trial partnership with Select & Save, Bargain Booze launched its own Bargain Booze Select Convenience offering. There are currently 21 stores across the country, and the chain plans to open 60 or more this year.
Alcohol accounts for 35-40 per cent of turnover in these shops, and joint managing director Matthew Hughes is keen to stress that Bargain Booze's range has not been "diluted", but only slightly tweaked, for example to put more focus on wines in the store's merchandising.
He says: "The Bargain Booze Select Convenience format is very much an addition to what we do, not a replacement for it. Our name is Bargain Booze for goodness sake - we can't ever lose focus on booze retailing. We might well be opening 60-plus convenience format stores this year, but we'd hope to also be opening a similar number of stand-alone off-licences.
"The thing about our convenience format is that it allows for the best of both worlds - the expertise of specialist off-licence retailing combined with a full one-stop-shop experience for the customer. In fact the two are totally complementary - so far we've found that the stores we've converted in our estate from Bargain Booze to Bargain Booze Select Convenience have seen a 12 per cent increase in their alcohol sales."
Wine Cellar general trading manager Steve Parker agrees that there is still a place in the market for specialist off-licences. The group opened 12 of its 26 Simply Food & Drinks convenience stores last year, and is planning to grow the brand "substantially" this year.
Parker tells OLN: "I think in a lot of locations convenience will become more important than pure specialists, but there are locations where specialists can manage quite successfully. For a lot of locations what we are doing is probably right, which is converting to more convenience offering rather than pure specialist offering."
Thresher is also developing its The Local convenience fascia. A spokesman says: "As society becomes increasingly time-poor the convenience sector will play an ever more significant part in people's lives. The local store, and increasingly The Local, provides the essential daily items customers need. Over the coming 12 months we expect convenience food sales will increase further as customers find value for money and quality nearby."
Other convenience groups are taking a closer look at alcohol these days to compete with improved offerings in the supermarkets.
Beers, wines and spirits make up 15 per cent of the turnover in Costcutter's 1,500 shops around the country. The group is stocking more eastern European beers and premium and pear ciders, as well as increasing its wine range over £5 and working on category management, especially for spirits.
Alcohol and tobacco trading manager Steve McCann says: "The convenience sector is extremely important to the UK off-trade, and this will continue to grow as the need to purchase products for consumption that evening or day increases as lifestyles continue to change. The increased costs of travel and the pressure to live a 'greener' lifestyle will also mean the ability to purchase a wider range of products locally becomes more important for many consumers, and the work we are doing with a number of suppliers will put us in a perfect position to capitalise on this.
"Any local retailer that does not understand or have the flexibility to cater for their local consumers, will find it hard to survive long term."
Spar's BWS trading controller Liz Aked says Spar is concentrating on its own-label offering - it added 10 SKUs to its World Wine offering last year and is launching an own-label over-ice cider this month.
"In 2008 our emphasis will be on communication both at store level and to consumers - exposure to hidden gems in the Spar own-brand range. We will develop our own brand into wine families, and cutting-edge store layouts in 'model stores' will be evaluated," she said.
Landmark's convenience chain Lifestyle has 1,300 shops across the UK, of which 436 opened in the past year, with 500 more openings planned for this year. Like other convenience operators, the retailer is boosting its premium spirits and wine offering, and giving these products more space in planograms.
Symbol groups, such as Musgrave Budgens Londis, give dynamic independents a way of trading in a marketplace which might have pushed them out without the buying power of a bigger group, and over the past year OLN has discovered a number of retailers breaking the mould with interesting and unusual local, fine wine and beer offers.
Many drinks retailers clearly see convenience as the way forward.
The convenience market:
facts and figures
The UK convenience market was worth £26.1 billion in 2007, 4.9 per cent up on the year before, and there are 50,814 convenience stores in the UK, according to the latest research by food and grocery information organisation IGD, in May 2007.
Non-affiliated independents make up 47.2 per cent of the market, while symbol groups have a 26.5 per cent share, forecourts 16.7 per cent, and multiples and co-ops 4.8 per cent each. But when it comes to takings the picture looks very different - the independents, who have nearly half the market, make just 27.1 per cent of its sales. Forecourts take 14.5 per cent; multiples take 13.3 per cent and co-ops 11.1 per cent. Symbols have the biggest share of the value market at 34 per cent.
Alcohol is the most important category for convenience retailers, according to a poll by OLN's sister paper Convenience Store. Fifty-four per cent of retailers said it was their top category in 2006, and 55 per cent expected it to be their number one category in 2007.