Promotions, Insights Help Brands Battle Cost Pressures

Convenience store retailers and their suppliers are facing a wide range of challenges that are putting pressure on profitability, from rising labor costs to product price inflation and other operational headwinds, including soaring freight costs and supply chain delays.

The Consumer Price Index for groceries rose 8.6% for the 12 months through February, the largest increase since 1981, according to the U.S. Bureau of Labor Statistics. This has put pressure on consumer spending, while unemployment remains low at 3.6%, which is driving up labor costs throughout the retail and CPG industries.

Capacity challenges in the supply chain, meanwhile, are expected to force higher costs for shipping and freight throughout 2022, with anecdotal reports of shipping container costs soaring by triple digits, for example.

At the same time, convenience store retailers and their brand partners are also battling competitive pressures from a resurging foodservice sector and changing consumer shopping patterns. In addition, with new norms around remote work, consumers have not fully returned to the previous commuting patterns that c-store retailers have long depended upon.

In this complex environment, retailers and their suppliers need merchandising strategies that take these variables into account and meet consumer demands while preserving profitability. With consumers now acutely aware of price inflation on store shelves and in other areas, it’s more important than ever to ensure that prices are competitive and promotions are used effectively.

Retailers and brands also need to work together to optimize their product assortments. They need to find opportunities to add items that could boost sales and margins, and remove items that are not having the desired impact on the top and bottom lines.

The current environment leaves no room for guesswork when it comes to pricing, promotions and assortment. It calls for in-depth analysis of data to help identify pricing and assortment opportunities. Brands need access to  data to refine their merchandising strategies, which in turn helps retailers optimize their assortments and price competitively.

For example, brands can use data to identify pricing opportunities by comparing sales of like items. Similar products that have a price disparity could be considered for price adjustments to drive higher volumes. Likewise, data can also be used to identify opportunities within categories and product lines. If certain SKUs of a product — a larger size, for example — are accounting for a predominant level of sales volume, the slower-moving item could be considered for removal to make way for a higher-volume alternative.

Comparing data across stores and across markets can also provide merchandising insights. CPG brands can target stores with the largest sales potential based on competitive and category volume to introduce new products, for example.

Data also provides insights into promotional opportunities. Brands can use data analysis to identify products that might benefit from promotional activity, and then help drive product sales by incentivizing retailers to promote those items.

Skupos, which aggregates data  from thousands of independent c-store operators, can help CPG brands optimize their assortments, and incentivize stores to move product through promotions on Skupos Engage, or through communicating incentives to carry products.

Brand-funded promotions can be especially effective for independent retailers and small chains, while CPG brands can use promotions to become more strategic with their trade marketing budgets. With Skupos Engage, brands only have to pay for discounts that actually reach the consumer rather than passing the discounts through distributors.

For more information about how you can leverage data to identify opportunities to battle today’s pricing and assortment challenges, visit

This post is sponsored by Skupos