Tuesday, August 16, 2011

A Look at the Credit Card Swipe Fee Reform: What Will be the Impact?

What Do Swipe Fee Reforms Mean for the Convenience Store Owner?

What will be the lasting impression left by the swipe fee reforms on credit & debit card transactions? The answer remains to be seen. Rest assured, however, that there will be many more twists & turns throughout this reform process. For those not familiar with the situation, let’s take a step back to look at it from the vantage point of a typical convenience store purchase with a payment card. When a customer pulls out their card and swipes it through the machine to make peyment, the operator is charged an interchange (or swipe) fee that typically ranges from 1 – 3% but can scale as high as 5% for some merchants. This comes out to an average of 44 cents per card transaction, and in 2008 operators nationwide spent just under $48 billion in interchange fees.

Following early reform proceedings, many industry experts anticipated a substantial reduction in costs shouldered by the retailers. But there has been push-back & pressure from major bank lobbyists, and changes to the initial reform bill have already been made. When the bill was first laid out, the proposed ceiling on interchange fees was 12 cents. This past June, however, after intense lobbying on behalf of the big banks, the maximum interchange fee was set at 21 cents. This modification goes into effect on October 1st, 2011.
As this article on NACS Online summarizes, there is still a lot to learn regarding the benefits and pitfalls of the swipe fee reforms. Allen Brothers echoes the considerations from NACS in encouraging retailers to take caution in regards to pricing until the full impact of the swipe fee reform becomes more comprehendible. Feel free to contact Allen Brothers if you’d like more information on the swipe fee reform movement, and as always, happy selling!

Monday, July 25, 2011

Norton's Notes - A Merchandiser's Perspective (Part 4)

Today’s posting is the fourth of a multi-part series on a feature that we have incorporated into our blog on a regular basis called Norton’s Notes. We will be periodically adding insight from our distinguished merchandising specialist, Jim Norton. The format of the articles will be in question and answer, and we encourage you all to keep the questions coming to our inbox at the Allen Brothers Inbox.

BEFORE: A Look at a Retailer Rack Prior to Receiving the Allen Brothers Advantage. Take notice of the uneven spacing and inconsistency of product placement.

AFTER: A Look at a Retailer Rack Following the Allen Brothers Advantage Upgrade. A much more unified display designed to enhance the aesthetics and maximize the amount of products.
Question 1.) When you're setting a store, is there a place that you start every time? Maybe in the grocery aisle or candy?

Answer 1.) I usually start in the candy aisle, which is what I would recommend for someone looking to do a little merchandising of their own. It is the easiest section to setup or reset in the least amount of time. It's also arguably the most essential area in a convenience store, so why not be your sharpest, right? The hanging snack and candy sections take more time as you try to set the proper spacing. I end with the grocery, pet and HBC sections, but each person has their own preferences and a lot depends on how you envision the store.

Question 2.) What's the proper amount of spacing that you recommend in an aisle? Is there an industry minimum size requirement?
Answer 2.) No big surprise here, but your customers need to be able to move around the store easily. As a convenience store or grocery market operator, it's a delicate balance between trying to fit the maximum amount of product while not overwhelming your customer's personal space. There are times when, as a store owner or operator, you need to look at the inventory you're carrying and determine if it fits what your customer is shopping you for. Here's a quick example of a spacing problem and a creative solution. Supermarkets used to feature a lot of aisle displays, transforming their customer's walk through the snack lane into a mini obstacle course. This made it not only difficult to navigate, but also burdensome and overwhelming. Now more use is made of end-caps and front end displays, making a huge difference in customer satisfaction.

Continue to check in regularly for continuous convenience coverage from Allen Brothers Wholesale Distribution.  Happy selling!

Friday, July 22, 2011

Cigarette Manufacturers Raise Prices

New Round of Cigarette Price Hikes

Cigarette manufacturers industry-wide are raising prices once again . Lorillard Tobacco Company led the charge in price increases, followed shortly, by Phillip Morris, Natural American Spirit, and R.J. Reynolds. Visit the website of the Winston Salem Journal for more information.

Changes in price are effective immediately. Be sure to consult your invoice for updated pricing, and adjust your pricing accordingly.

Thursday, June 30, 2011

Cigarette Labels Going Gory

Graphic Cigarette Labels that will appear on Cigarette Packs in September 2012
The Food and Drug Administration (FDA) has chosen the final nine health warnings which will appear on every cigarette pack and advertisement by September 2012. Allen Brothers encourages you to view the full story published in last week's New York Times.

As you can imagine, reactions have been mixed. There are some significant questions regarding the constitutionality of the Tobacco Control Act, especially in regard to the tobacco companies’ constitutional rights to free speech . So far, however, cigarette manufacturers are reserving comment. Allen Brothers will keep you updated of any updates on this story.

Tuesday, June 28, 2011

Follow-Up on the 2011 DOT Food Show: Foodservice Fuels C-Store Success

Hot Dog Roller Grills Remain Core C-Store Item

Following a three-day trip in St. Louis for the 2011 DOT Food Show, there's just one thing on my mind: Foodservice! Did you know Foodservice ranks third in convenience store sales behind just fuel and tobacco? With the ever-increasing restrictions on tobacco and the fluctuating state of oil throughout the world, the best way to protect margins in today's market is to look outside the box and inside the bun! Hot dog roller grill programs, pizza on-the-go, coffee and cappuccino, and slushie units are just the tip of the iceberg when it comes to the wide array of products and programs that are becoming increasingly available to convenience store operators on a daily basis.

The DOT Food Show was an eye-opening experience. Through seminars and interaction with industry leaders like Allen Brothers, the marketing and buying team observed the capabilities of the manufacturers, distributors, and retail owners to combine ingenuity and opportunity to create successful and lucrative sales. At Allen Brothers, we are committed to staying ahead of the curve. We are currently putting together a comprehensive Foodservice program that will empower our customers to take full advantage of this major profit driving division. The Allen Brothers Marketing Team has been posting pictures from the show of potential products on their Allen Brothers Facebook Page. We encourage all of our customers to visit our Facebook page and let us know what products you like best!

If you have any questions regarding foodservice or ways that Allen Brothers can help you grow your business, contact AB Today!

Tuesday, June 7, 2011

Today’s installment of “Norton’s Notes, A Merchandiser’s Perspective,” sets its sights on point of purchase sales and owner/manager involvement in the store setup. Our merchandising and marketing department are happy to answer any and all of your questions. For feedback or to have your question answered, email the Allen Brothers Inbox today at mailto:jwinning@abdelivers.com.

Question 1) How many items should a store owner carry at the counter-top?

Answer 1) The maximum that your space allows. There’s always apprehension about overloading a counter, and it’s a legitimate concern. But your customers can’t buy what they can’t see. The type of products at checkout have to be hot impulse items, this is no place for a slow-seller. Novelty candy, gum, mints, toys, this should be the focus. If an item has been on the counter for more than two weeks with minimal turnover, it’s time to shuffle product. But it’s never recommended to stack different types of products on top of one another. Give each item the opportunity to stand out to maximize your point of purchase sales, as shown below.

Question 2) Do you find that most store owners want to be involved in the process of merchandising and setting their store, or prefer to leave it up to you? And which scenario do you recommend?

Answer 2) Some owners are more hands on than others. They sometimes have specific plans for their store. Others will give me the freedom to setup their store as I see fit. Setting an appointment to plan the procedure is always a good idea so you’re not going in blind. Both scenarios have their ups and downs. But the more engaged a store owner is in the setup of a store, the more committed they likely will be to maintaining the allure of the store’s appearance.

Friday, May 27, 2011

Allen Brothers Wholesale Distribution: Technology is Everything - Retail Merchandiser

Allen Brothers Wholesale Distribution: Technology is Everything - Retail Merchandiser - Redcoat Publishing

Follow the link to check out another great article on Allen Brothers Wholesale Distribution featuring, among many other things, valuable insight from Allen Brothers Executive Officer and Principal Joe Shott (pictured in story) on the ever-changing face of the convenience retail industry.