Now Look Who's Reinventing the Grocery Store

No one goes into a hardware store to buy a 3/4” drill.

What they want is a 3/4” hole!

That basic Marketing 101 concept applies to grocery stores, too. Who goes to the grocery store to buy, well, groceries? What we want is DINNER! 

• But, can you go into a grocery and find “dinner”? Or “breakfast”? Or, “great lunches”? No. Instead, there is a produce section. And then a canned goods section. And then the frozen foods section. Plus, an overwhelming assortment of choices, whether it is mustards or pickles or pasta or….

Meanwhile, consider the shoppers, who are increasingly purposeful. They have a shopping list, and they stick to it. They are spending less time (and money) in the grocery stores. And, a greater proportion of their in-store time is spent simply navigating the store (what they want is on the perimeter), or checking out. 

This is an industry that is ripe for disruption. And sure enough, that is happening. Consider how the meal-in-a-kit delivery services – e.g., Blue Apron, Plated, HelloFresh  – essentially are re-inventing the grocery store.

• You sign up online; they deliver to your doorstep a box that contains the fresh, raw ingredients for 3 to 5 meals, all in the proper proportions (no wasted food or languishing jars of spices), along with explanatory recipes (with pictures) from their in-house chefs. 
• You do the chopping, cutting, and cooking.
• In 35 minutes or so, you sit down to a home-cooked meal.
• All without the time-consuming demands of meal planning or traditional “grocery shopping”

Yes, This IS Retailing!

Alas, these new businesses do not regard themselves as retailers(!) But to us, everything they are doing is what retailers do: 

• Selling to the ultimate consumer
• Sourcing product from carefully-selected suppliers
• Editing the selections - limited meal choices each week
• Educating about new products or cooking techniques
• Engaging the customer in an experience - in this case, home cooking

But Wait...There's More!
Very High GMROI
Plus, they do it all essentially on special-order. That is, customers sign up for next week’s meals; these services don’t carry inventory, but instead, buy only what they already have sold. 

High Growth Potential with Low Fixed Costs
And, as a web-based delivery service, they can grow their customer base at a faster rate than fixed costs. The 3 services we cited can deliver to 85%-95% of the continental U.S. (And HelloFresh also operates in Australia, Europe, and the UK.)

Remember, “value” for customers is benefits received for the burdens endured. 
In our view, these meal-kit delivery services are delivering great burden-reducing value to the customer! And, whether they realize it or not, they are reinventing the grocery store in the process.



We believe this offers, ahem, much food for thought for all retailers. 

• What are the burdens that your shoppers must tolerate? 
• How might you relieve those burdens?
• How can you increase the value they receive from your stores?
• And how can you do that before some “disruptive” competitor steals their hearts away??

Be Ready! New Patterns for Peak Shopping Days

You noticed it, right? That traditional lull in shoppers, between Thanksgiving Weekend and the 10th of December.  

That is just one of the predictable patterns within the Holiday shopping season. Next up: the surge this weekend, and then of course, next weekend, the last one before Christmas. That's when the shopping malls ask many stores to be open till midnight, right?

But, sure enough, especially this year, these "traditional" patterns are subject to another trend, the "digital disruption".

• First, accept that the shoppers will certainly be busy doing their thing; it just may not be in your stores yet.
• Instead, more folks will rely on the web for their window shopping, browsing, price comparisons, etc.
• When they do show up in your stores, they are on a mission! Not browsing; just buying. 

This Year's Peak In-Store Shopping Days

So, when will in-store shopping peak? Not on the traditional last weekend before Christmas. Instead, watch for it to peak on Monday the 22nd and Tuesday the 23rd, and of course Wednesday, Christmas Eve. 

Why? Two main reasons:

1. The "traditional" reason: those are the days when most men (and women who shop like men) actually do their buying.
2. The "digital disruption" reason: the deadlines for buying online and having guaranteed delivery by Christmas will have passed. At that point, the customers will show up, and depend on stores to come through!

Those retailers who are anticipating these changes will be better able to effectively schedule their staff. You can likely schedule in anticipation of the Monday-Tuesday crunch.

• And therefore, having "paced" yourself and your staff, you will be well positioned to deliver great customer service on those crucial, crunch time shopping days and evenings.

What better way to keep the Ho! Ho! Ho! in the Holiday Season?

Start Now to "Beautify" Year-End Financial Statements

For most of you, your fiscal year end (i.e., 12/31; 1/31; 2/28; etc) is rapidly approaching.

"So what?", you ask.

Well, whatever your year-end financial statement says about your business, you will have to "live with" for the next year or longer. And each vendor, bank, or landlord you share it with will judge your business by it. So, now is the time to dress it up! 

Is there a beauty parlor for retail businesses? Yes!

We just conducted two workshops at a huge trade show in Chicago. We taught those retail dealers how to financially beautify their businesses. (And some of these retailers are already making "dress up" plans.)

How Your Business Is Judged for the Next Year

Always remember: your debt-to-worth ratio is the #1 measurement of the financial strength (or weakness) of your business. So, how can that be improved? Here are 3 choices.

1. Obviously, the more net profits that are added to your retained earnings from your P&L, the greater your equity/net worth will be.
2. But, shrinking your liabilities (any and all debt) is the most impactful and controllable way to improve your year-end debt-to-worth ratio.
3. "Controllable?" Yep. Shrink (sell off; liquidate) any assets you can (especially excess inventory) and apply that cash to paying down debt.

If you take these steps vigorously, there is a Miss or Mister America Pageant you can enter!! 

And best of all, this "financial beautification" is far more than skin deep. It makes for a much healthier business as well.