Woman shopping in supermarket

Childhood obesity

Healthy profits: how wholesalers and retailers can increase sales of healthy products

1 April 2021
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4 min read

Portfolio Manager Claire Stidston shares more on our pilot to engage wholesalers and convenience stores to drive uptake of healthier options.

Convenience stores and improving food options

Within our childhood obesity programme we aim to improve the spaces in which children and families spend their time, in order to make healthy and nutritious food more convenient and affordable. One retail environment that helps to shape families’ food shopping – and ultimately what they eat – is convenience stores. Independent convenience stores perform a vital role in meeting local community’s needs, particularly for families in low-income areas.

The local convenience store sector is made up of hundreds of mostly small, independently owned stores, supplied by a handful of convenience store wholesalers. We have been working with Rice Marketing to support to increase their sales of healthier products into local convenience stores, and with convenience stores in Southwark to increase the number of healthier food options they stock and sell to the public. We have recently launched our report outlining the key findings of this work.

Initially we ran a pilot working with convenience stores ‘The Good Food Retail Pilot‘ which resulted in an increased range of healthier items available in store, and an uplift in sales of healthier products. It emphasised that small and simple changes can have a significant impact on purchasing behaviour.

 

Working with Bestway to create healthier options

Convenience store retailers then asked that their wholesalers be brought into the discussion to help them achieve their objectives this led to a pilot working with Bestway wholesale depot in Croydon. The pilot focused on creating a ‘healthier choices’ range comprising of 130 variants from the existing Bestway range. The aim was to demonstrate how simple and practical changes to positioning, pricing, signposting, and marketing of products can help to encourage retailers to purchase and stock more of these healthier options.

The trial has allowed us to gain more insight into retailer behaviour and the effective ways to engage with wholesalers; helping us understand the levers and communication required for success.

Claire Stidston Portfolio Manager

Learnings from the pilot

Through the pilot we learnt:

  • It is possible to influence the healthiness of retailer buying habits. The volume sales of the healthier choices range increased by 17.7%.
  • It is possible to position health at the heart of the existing offer.
  • The key tactics of pricing, promotion, availability, and merchandising, have the biggest impact when used in combination. For example, when combining these tactics, sales volumes of Alpro products increased by 21% and sales volumes of Graze products increased by 170%.
  • Impactful trials can be simple and sustainable. The video below captures the positive impact this had on attitudes and sales.

The report details the approach and the preliminary results from the interventions launched by Bestway, showing the positive impact of the pilot for retailers and consumers, as well as a positive financial impact on business.

What’s next?

The trial has allowed us to gain more insight into retailer behaviour and the effective ways to engage with wholesalers; helping us understand the levers and communication required for success.

Our aim for the next phase, which is co-funded by Southwark Council, is to improve the food sold in independent convenience stores. We will expand the approach to 40 stores across Southwark that have been identified as operating in areas of higher deprivation, to make the case for the commercial benefit of increasing the number of healthy options stocked in these stores.

We will test a range of levers, from promotion to merchandising, to increase the number of healthier products stocked and sold locally. Through this next phase we want to continue to show that promoting health is not just good for people, but also good for profit.

We will also support wholesalers to increase the proportion of their sales from healthier products into local convenience stores, by working with two further wholesalers and using the learnings from the pilot to help make health considerations part of their business planning.

Rice Marketing will lead an engagement piece with major suppliers and wholesalers at a national level to start putting health at the heart of national strategies. We have kicked off this next phase of work with support from The Federation of Wholesale Distributors, Unitas and Sustain and aim to launch an industry roundtable in April 2020 bringing leading wholesalers and suppliers together to discuss developing practical solutions to providing healthier foods to our communities.  The aim is that this roundtable will evolve into an industry taskforce who will take these plans forward and lead the sector with a vision for a healthier future.