Free Aldi bus for students' weekly shop

                                                                                                           pic: An Focal

Given the discounter’s primary audience-mix of students and senior citizens, and the likelihood that carefully managed long term loyalty will eventually bridge the generation-gap, this new initiative indicates the degree of Aldi’s determination to optimise its market share long term…

Currently operating at UCD, Trinity, Limerick, DCU, and Dundalk Institute of Technology, Aldi plans to serve all third level campuses by the end of 2015.

“The bus service is completely free, anyone can hop on, you don’t have to live on campus at all, you just need to email the UL Aldi Bus Rep, book your spot and even if you don’t you can show up and if there are spaces available you can get on.  They have allocated stops for the bus so it’s safe, the students will be signed on by reps and they will make sure everyone is on again after they are finished their shopping.”

Aldi’s “University” page on its website features weekly promotions of healthy recipes and cooking guides, along with the cost of purchasing each meal, in a weekly shop of €34.

Not bad for the ‘foreign, downmarket, cut-price retailer’ that had the cheek to enter the state-of-art, up-market, big-space UK retail scene 25 years ago…

With an 8.1% share of the Irish market, Aldi have no plans for extending its bus-service to the UK, yet…

New Walgreens Boots growth strategy - back-to-basics+ via Boots

Building on improved sourcing - scale economies - across the group, the Boots influence on Walgreens is being demonstrated via convenience, pharmacy modernisation and customer care. In the US, this merely represents the harvesting of low hanging fruit…

However, a key contribution will be Boots global vision applied to wholesale consolidation, with M&A a vital route to WBA global purchasing power. In the process, it is unlikely that the group will pass up many opportunities to expand its retail footprint via acquisition.

In other words, we are beginning to see the emergence of a fully global group aimed at selling any H&B goods and services that can be legally sold to consumers and retailers, with buying muscle to match…

It is vital that suppliers gear up to this new global reality, in terms of time, money and people.

When it comes to globalisation, McKesson-Celesio has the potential to go global, but is way behind Boots WBA vision.

The major grocery multiples are currently focused on protecting their national/UK interests, and are no longer acting globally.

This leaves WBA as the only global player in H&B. 

The group is being driven by the Boots culture in retailing, and Alliance Boots in wholesaling, implementing a global vision that has not missed a beat so far…

A diminishing window to get things right?
Suppliers need to prepare for the inevitability of full global coverage, and ensure that their prices and terms are fully synchronised, before WBA gets really serious about scale economising…

Less is the same, but the cost is more

Like bankruptcy, a brand dies in two stages, first slowly, then suddenly....

In other words, whilst the Tesco product cull may contain a few (30,000) surprises, the slow, steady erosion of brand equity leading to this inevitable de-listing will have been building for a number of years via petty short-changing of the consumer by the brand's champion via same-price contents reduction, on the assumption that consumers are locked into unquestioning loyalty, like years ago.....

'Savvy' buying started with the consumer and has gradually spread up the supply chain, but appears to have stopped short of the brand owner....?

Given the effort it requires to build brand loyalty, and ease with which it can be destroyed, coupled with the multiplier effect of a dissatisfied consumer telling 10 friends, it is bewildering how brand owners are taking such liberties with brand franchise in reducing contents...

Taking into account the ability of the consumer to product-compare on the go, it becomes obvious that the real cost of brand desertion is borne by the supplier, with Tesco merely the catalyst, and the consumer a key driver.

When a customer becomes a busted flush - where this leaves the NAM, incrementally?

Today's news that unsecured creditors of 'in administration' Phones 4u are unlikely to receive any compensation is just the latest demonstration of the difference between government 'green shoots' and the street-level experiences of businesses and the public...

Given that any supplier making 5% net profit before tax and owed £150k by Phones 4u, now need incremental sales of £3m to cover the lost profits, it is obviously vital that in any category, NAMs, as chief can-carriers, need to be hyper-sensitive to the financial health of their customers...

Why NAMs?
Other job-holders, being at least at one remove from the supplier-retailer commercial interface, and reliant on open domain returns at Companies House, tend to work in arrears...

However, a NAM is usually in the thick of the day-to-day sell-buy exchange with customers, dealing with the customer's live issues like off-shelf sales vs. target, cash-flow, real-world in-store fulfillment and compliance, against a constant backdrop of demands for cash and extra days credit...

Add to this the NAM's (intimate) knowledge and insight re the personalities involved in the decision-making-process, coupled with latest available financial returns and the result is a 'good-as-you-get' indicator of the customer's ability to stay in business.

Other key indicators are detailed here and here.

Whilst you may be in doubt as to who is in the firing line when it comes to customers going bust, you can at least be sure that you will be head of the queue when it comes to attempting to generate the incremental sales required to cover lost profits...

To avoid becoming another busted flush, why not calculate the current amounts owed by your customers, divide by your pre-tax net profit margin, and multiply 100 to reveal the true scale of your exposure vs. your current incremental sales options...   

The CMA investigation of Poundland’s takeover of 99p Stores - a retro, redundant exercise in cut-priced, hyper-competitive British retail?

Over at The Telegraph, Graham Ruddick reports that the Competition and Markets Authority's analysis could result in the closure of 33% of the 99p stores, thereby jeopardising the deal...  He also points out that the UK consumer now has unprecedented multichannel access to choice via discounters, major mults and the Internet.

This makes consumers less vulnerable to abuse by anti-competitor behaviour.

We would simply add that where market information flows freely, competition plays a regulatory function in balancing demand and supply.

In other words, the emergence of price comparison tools, at home and in-store, has helped to create a state of almost perfect competition in the UK, where the role of the CMA is in danger of becoming redundant, unless little £1 sparks of initiative are damped down at birth...

If fact, in the current real world, could the CMA initiative be deemed anti-competitive?

What if Aldi & Lidl grow at 10% in flatline?

Apart from politicians' assurances re post election growth, just suppose that we are into flatline growth for the next five years, at least...

Also given Aldi & Lidl combined share of 9% (see yesterday's NamNews) and a conservative (!) estimate of 10% growth vs major mults at 0%, the two discounters will reach 15% share by 2020...

The resulting issue for suppliers has to be, barring radical changes in discounter ranging policy, most of this growth will be via surrogate branding, at the expense of national brands...

Branded suppliers have a choice:

• Either persuade the discounters to stock more brands...
• Or find a way to optimise private label, and seek a fair share of the discounter action

...whilst the major mults mount the deepest price cuts ever, possibly fuelled by back to front margin moves...

'Back-to-Front' thinking spreads on-shelf as Melbourne shopper encourages people to buy local

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In a classic example of unforeseen consequences of shopper engagement, the Daily Mail reports on an Australian woman starting a ‘flip it and reverse it’ campaign and turning labels around so people can see where supermarket foods ACTUALLY come from...

The issue for retailers is whether this one-off initiative represents a single-shopper quirk, or is perhaps the tip of a consumer-need iceberg. In other words, should enterprising retailers seize a competitive edge by filling shelves to reveal label contents, and perhaps add an occasional normal facing to aid brand-identification?

Given that this 'dumbing-up' would reverse years of simplifying shelf-filling process, and could result in knock-on labour cost-increases, perhaps suppliers could play their part by modifying their shelf-ready pack configurations?

Meanwhile, marketing colleagues on regular store-visits are bound to notice the slight reduction in pulling power of current back-of-pack labelling, and may hopefully authorise enhanced branding of rear labels..

...thereby begging the question as to the function of the now-redundant front label, in these unprecedented times?   

A Post-Easter Bargain from Sainsbury's?

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A Manchester offer you can refuse, and one you cannot, Moscow-style?

                                                                                                  pic: Business Insider

With inflation in Russia running at 11.4%, maintaining the retail price represents a discount!

Meanwhile, in deflationary UK, holding the price steady indicates a price increase!

Fortunately, in each case, the consumer is savvy, and understands these subtleties!

More on Russian pricing here at Business Insider