With innovation comes a changing product selection, and convenience store retailers must constantly keep pace with new trends while staying a reliable source for their market area’s consistent purchases. CStore Decisions caught up with Jon Fleck, merchandising manager at Cenex Zip Trip, which operates 38 locations in seven states, to hear his thoughts on and how he handles product management.
{CStore Decisions (CSD)} How do you determine your product selection?
{Jon Fleck (JF)} We have 38 stores in seven different states with no more than two stores that are laid out the same because of acquisitions. We work with Core-Mark and their Center of Excellence program to determine our sets based on our store size, room for shelving and displays, plus our purchases, along with purchases from their other customers in the regions we do business in. They show us items that move well out of their warehouse that we don’t carry, and we work those items into the stores. We also do “SKU Rationalizing” by looking at our scan data and deleting slower-moving items.
{CSD} How do technology and automation play a role in your inventory management?
{JF} We monitor turns on our items either by product category or by individual universal product code (UPC) scan data. We know there are certain categories that the turns are going to be slower than others, but we still want to make sure we carry those types of items that the customers want. Because all our inventory audits are done by UPC, we can determine the exact items missing when an inventory comes up short. Technology makes this possible.
{CSD} How do you balance a consistent, reliable offering with new trends?
{JF} We never want a customer to ask us about an item they saw in one of our competitors that we don’t already have. In many of our locations, we have a section near the front endcap that has new items. In the past, we had small tables near the checkstand for new items to see if they sell well enough to put them in our actual sets. We still want to take care of those old friends — those items that continue to sell day in and day out — but we also must stay on top of this changing landscape.
{CSD} What role do niche/unique products play in your product assortment?
{JF} Everyone is selling Pepsi, Coke, Frito-Lay products, Hostess and Jack Link’s. We try to bring in products that are local to the area our stores are in. Whether it is Montana Silversmiths jewelry or Twisted Bee pretzels made in South Dakota, or shirts and hats from Blue Peak Creative and Last Best in Missoula, we want a little local offering in our locations. You must have something that differentiates you from the rest of the pack.
{CSD} How do you handle excess inventory or merchandise that isn’t selling well?
{JF} We try to buy as much product that we can that is guaranteed from the distributors. If sales aren’t what we expect, then we return it after three to four months. If it isn’t guaranteed, we will drop it down to cost to blow it out, and whatever remains is sent to the food bank or homeless shelters. We feel it is better to do that than to plug up the stores with non-moving product.
{CSD} What is the biggest challenge that convenience store merchandisers have today?
{JF} For some stores it is the lack of space near the high-traffic areas. Some customers you will never get past the checkstand area, and many of our stores have the checkout right when you walk in the store. Each vendor you talk with tells you how well their product will sell if it is sitting on the checkstand, and of course, I tell them everything does. We need items that are eye catching that can sell throughout the store. In our stores, we are constantly moving displays and products around to different areas, especially if they aren’t selling, to see if they sell better in another location.
