Spicing up the Village Pantry

By Mehgan Belanger

INDIANAPOLIS -- There's a definite "buzz" in the air at the headquarters of the 146-unit Village Pantry convenience chain, and it's not from the coffee.

In May 2007, Mick Parker came from sunny Florida, where he was the vice president for Circle K's Florida and Gulf Coast region, to his new role as the president of Village Pantry, which was newly split from Marsh Supermarkets Inc. Since Parker joined the helm of about six months ago, drastic changes have been under way at the once floundering company. In October, the chain completed the acquisition of the 33-unit Next Door Store chain, operated by Imperial Oil Co. -- its first since splitting from Marsh -- and unveiled a new store design for all existing sites, which has been implemented at three locations to date.

He also established a new mission for the retailer -- "to become the best place to work, shop and invest," Parker told Convenience Store News, and was quick to note that getting to this point has not been easy.

One of the first things Parker accomplished was establishing his executive team. The key positions went to many people he had worked with in the past, including his time with Circle K.

The chain also tackled its merchandising and remodel plan. "We were trying to immediately impact what was going on in the day-to-day business. We didn't have things like category or merchandising plans," he said.

Describing the merchandise plan, Mike Ross, senior vice president of merchandising and fuel, emphasized learning gained from customer research. "Customers don't like clutter," he said. "We sell convenience. Customers want to be able to walk in, stage where they want to go inside the store and go there."

To accomplish this, new merchandising plans include low-profile, angled gondolas with strategically placed product at the front and back of the structures. "As the customers are driven to the back of the store toward the cooler, there are high-gross margin items as they travel back to the sales counter, so we will hopefully capture those sales," Ross said.

The company is also merchandising the four corners of the store to feature destination categories including coffee, foodservice and fountain offerings, and the team underwent a SKU rationalization, which removed approximately 1,000 SKUs.

As a result, the remerchandised sites boast expanded snack and grab-and-go categories, with reduced grocery and general merchandise sections.

And the changes have already shown success. "We are seeing growth in the categories that we had anticipated, because of the philosophical things that we did," Ross said. "We're seeing growth in some our higher profit items -- beer, coffee, deli, bakery items and fountain areas."

Currently, the team is remerchandising stores that are not slated to undergo construction. "Since we can’t remodel all of our stores at once, we can remerchandise stores," Ross said. "We certainly want to improve the offerings for the core customers until we have the opportunity to remodel."

To date, the chain completed three remodels and 11 more are in various stages of construction.

At the forecourt of newly remodeled store 401, located in Fishers, Ind., a flashy red and silver checked pattern covers the gas canopy, pump tops and the area below the store eaves.

The store's exterior is painted a sparkling white, while inside, brown and black earth tones complement warm wood accents and highlight metal trim.

A black ceiling sets the mood, while modern graphics painted on the foodservice, hot beverage and fountain walls attract attention.

The black wire gondolas topped with metal trim are low enough to see across the store and set wide apart, making the store seem much bigger than its average c-store size.

All stores will see versions of the remodel based on investment levels and quality of real estate, according to Parker. "Generally, we will want all of our stores to have the same look and feel, to have the same core offerings," he said.

Besides remodeling its portfolio of stores, Village Pantry is looking to grow through acquisitions.

"We don't have a prescribed formula -- we will be very opportunistic," Parker told Convenience Store News. "Generally, most of the acquisition opportunities will be smaller, in the five- to 150-store range," he said, noting there are several acquisitions in various stages, but declining to provide more details.

As for a goal number of acquired stores in 2008, Parker remained vague. "What can we buy at the right price and what can we integrate easily?" he asked. "What we will quickly come to is the ability to integrate – how many, and how fast can we absorb them? That will be the limiter, I think."

For more behind the scenes happenings at the Village Pantry headquarters, look for Convenience Store News' online Bonus Content.

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