Honing a Concept

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Honing a Concept

By Mehgan Belanger - 11/03/2008
In the April 14, 2008 issue, Convenience Store News profiled Pantry Gourmet, a new c-store concept built by Norwood, Mass.-based New England Pantry, operator of 57 White Hen Pantry convenience stores. The model -- which incorporated fresh produce; organic, traditional and all- natural items; a bulk deli; meat department; restaurant-quality foodservice and grab-and-go section; and a national brand cafe -- pushed the envelope of what the words "convenience store" mean. The channel-blurring location generated high average dollar rings, with some transactions as high as $40, and customers shopped the store so much, shopping carts were needed to carry all their items. Six months later, with several changes to the concept and another Pantry Gourmet concept store opening this month under the White Hen banner, CSNews checked in with the chain's director of marketing and merchandising, Chris Brosco, to see what the firm learned from this innovative store.

A high average basket ring and the addition of shopping carts would indicate Pantry Gourmet is a hit. And while the store has been a success in many ways, according to Brosco, the firm wants to see more convenience stops from customers, rather than fill-in grocery visits.

"What we discovered is we were not getting the frequency of shopper visits that you [normally] get in a c-store operation," he said. "People visited too few times per week. It is a good, solid, loyal base, but in a community with a relatively low population -- under 8,500 households. We need them to come in more often than once or twice a week."

The store does see daily customers who come in for grab-and-go sandwiches and other prepared food items, but the typical visitor is geared more towards grocery shopping. "If we built the store in a metropolitan area with a huge population, that [type of customer] would have been fine," he explained.

To change shoppers' behavior, the store brought in and emphasized some c-store products purposely left out initially -- lottery and tobacco products. The store was initially wired for lottery services in case it needed to be added, and it did carry tobacco products, although they were not visible to customers. Now, the company installed lottery, and tobacco products carry a much more visual presence than the original setup, said Brosco.

"It wasn't without foundation that we eliminated [tobacco and lottery]," he said of the initial store setup. "In many instances those things define a c-store, and that's not the full image we wanted to convey. We weren't abandoning our c-store roots, but wanted people to think on a more broad scope, to accept it for a lot of different things, and have no preconceived notions of what to expect."

However, the store will see its name change from Pantry Gourmet to White Hen Pantry, the same name as the company's convenience chain.

"The one thing working against you when you develop a second brand is the current advertising doesn't help the new brand," Brosco explained. "We hoped people were so in love with the store, visits would ramp up, and being in contact with customers through direct mail would be enough."

By switching the name, the company will be afforded "a lot more efficiencies in advertising," but Brosco acknowledged it could give the unwanted preconceived notion of a c-store -- the one thing the concept was built to avoid, he said.

Brosco attributed much of the challenges the store is facing to the weakened economy, and believes the store will take about two years to mature, although sales are growing each day.

Other changes include an expanded prepared food offering, including some of the traditional sandwiches and salads from the White Hen c-store operation, and an adjustment of the fresh produce to more traditional sets, rather than the organic and natural emphasis when the store opened.

"A lot of that has to do with current food prices," Brosco said. "At this point, folks are more concerned about affordability than organic and natural." As a result, the store accentuated its traditional grocery set, which is more affordable.

One addition being considered for the original location is a regional branded pizza offering, and two brands are currently being evaluated. "People outside of Massachusetts never will have heard of it," Brosco said, declining to reveal either of the potential names.

Some things inside the Pantry Gourmet concept will remain the same. The keystone of its offering -- an extensive, full-service foodservice section that includes sandwiches, wraps, ciabattas, personal pizzas and soups -- has performed twice as well as what the company expected. "That part of the operation is working perfectly," he said.

Meanwhile, the fresh meat section also picked up speed since the store opened, notably this summer when customers would visit to pick up barbecue supplies. Similar to foodservice, this segment generates a "much better response than one would expect in this channel of business," Brosco said.

A second Pantry Gourmet-style location will open this month under the White Hen Pantry name. Located in Plainville, Mass., a town of a similar size and demographic profile to the first location, the store has many similarities and a few key differences from the original Pantry Gourmet.

"With two stores, we can measure one against the other," he said. "We want to compare the two locations, find what works better, and transfer it around."

The stores are the same size, yet the new location will offer tobacco and lottery from the beginning, as well as a beer and wine section.

The second also sports a different design. There are more windows at the second site, and it is a square footprint, rather than a narrow rectangle like the first location. Inside, the point-of-sale (POS) is positioned in the middle of the store, whereas in the first Pantry Gourmet store, the counter is along one side of the store.

"That was the just the nature of the design. The Plainville store lends itself more to a counter in the middle," said Brosco. "Part of that is because beer and wine can't be sold 24 hours, and we had to create an alcove to close off the section. The POS creates one wall to close it off."

Another difference between the two stores is the company's selection of New England Coffee Co. as its hot beverage partner, a departure from the Chock Full o' Nuts name at the first location. New England Coffee is the No. 1 brand in grocery outside of national brands such as Green Mountain and Maxwell House, he said. "We hope the brand recognition will carry over and people will see that brand means something."

While the Pantry Gourmet concept is still in its infancy, the lessons it has already generated will help the company across the board -- including at its long-standing White Hen Pantry c-store chain.

"As we open up new stores, we don't think the traditional White Hen Pantry will look the same," he explained. Though the stores will still have the traditional mix and presentation of convenience items, they will have some of the Pantry Gourmet "flair," he added.

"Stores will never look the same as in the '70s, '80s and '90s. Not just the color scheme, but the whole experience," he said.