CHICAGO -- Officials of three associations representing convenience retailers, distributors and manufacturers of candy and gum discussed the objectives of a study, now underway, intended to help generate increased sales and profits of confectionery products in convenience stores nationwide. Appearing at a media briefing during the National Confectioners Association 's (NCA) All Candy Expo in Chicago were Jim Corcoran, vice president of trade relations at NCA; Robert Pignato, vice president of marketing, membership and industry affairs at the American Wholesale Marketers Association (AWMA) and [image-nocss] Dae U. Kim, vice president of research at the National Association of Convenience Stores (NACS). Joining them were executives of member companies of each association and industry consultant Kit Dietz, Dietz Consulting LLC, Huron Ohio, a former c-store distributor who is leading the research initiative.
“Confections generate nearly $5 billion in annual sales in 146,295 convenience stores across the nation affecting every single convenience store operator and distributor, as well as the suppliers themselves,” Dietz said. “That fact illustrates the importance of increased collaboration all along the supply chain and is precisely why all three organizations are cooperating on this study.”
Dietz said there are specific factors that can influence performance of confections and significant opportunities for improvement. “Our task is to identify those factors and opportunities and provide recommendations for action that can benefit manufacturers, distributors and retailers alike,” he said.
He pointed out that consumer preferences are shaped by demographic factors, social issues, concerns about health and wellness, lifestyles and a changing economic climate among other factors. All are issues, he said, that must be addressed both at the supplier and retail level, and which distributors must also keep in mind when working with retailer customers.
At the same time, Dietz said, there are costs within the system that confront convenience distributors that must be addressed to increase efficiency and allow those companies to make a fair profit. The research, he said, will identify best practices that can help reduce those costs and improve speed-to-shelf, a factor that is especially important when manufacturers seek to introduce new products into the convenience channel.
“New-item introductions drive about 6% to 7% of category growth,” Dietz said, “so they are critically important. But at the same time, there are issues involved with new-item introductions that can reduce profits to manufacturers, distributors and retailers alike. We will identify those problems and present recommendations for improvement.”
Thus, he said, the study will focus on all of those points—operational efficiencies, marketing opportunities, consumer trends and manufacturer responses. “We intend to provide insights and knowledge to help all segments improve their performance across the confections category within the convenience channel and create strategic advantage for all channel partners,” he said.
The study will be previewed at the AWMA Summit & Business Exchange (ABX), which will be held September 9-12 at The Ritz-Carlton, Lake Las Vegas.Members help make our journalism possible. Become a CSP member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.