Hot Stuff

AT A GLANCE

• A good hot food offer will naturally generate extra sales in other categories. Bundling and combo deals are a good way to capitalise on the possibilities.


• The ability of a quality cabinet to maintain freshness and thus keep wastage to a minimum should not be underestimated.


• Don’t choose a cabinet that is too big. It is better to have a smaller cabinet looking full than a big cabinet looking empty.


• Extending a hot food offer can also lead to a sales spike in the sales of the existing hot food products, often by as much as 20-25%.

Well-presented hot food offers can send profits surging

The hot food offer has a key role to play as convenience and impulse outlets rapidly evolve in order to meet the public’s changing expectations of them. The days of the traditional, occasionally suspicious looking sausage roll or meat pie have been swept away by a tide of professionally presented quality offerings that make many stores serious competitors with the quick service restaurants down the road. The consumer is now demanding a premium quality product – whether it be a pie, pastie, sausage roll or burger – and they, not unreasonably, also want the way the food is presented to be clean and appealing.

It is a fact of life that the aggressive attempts by the supermarket giants to eat into the grocery sales of the convenience channel is having an effect. Savvy small store operators are realising they may have to adapt to survive, and delivering a stronger and wider hot food offer to the customer is one of the options available ... and it works.

While regional operators have been installing extended hot food offers for some time now, it is become increasingly evident that improved hot food offers are moving into suburban and city locations as the potential benefits are fully appreciated.

The ambience of the traditional convenience store is changing, and the smell of premium coffee and the sight of a clean, well-stocked, attractive hot food merchandiser commonly greet today’s convenience customer.

However, if outlets are to be successful in their attempts to draw customers away from quick service restaurants, the hot food offer needs to be available in store and it needs to be appetising.

There are a number of manufacturers that cater to the hot food merchandiser needs of convenience and impulse outlets. These include companies such as Avem, Future Products Group (FPG), Food Service Machinery (FSM), The Perfect Fry Company, and hot food companies such as Mrs Macs and Patties. Stores can choose from a complete range of food display cabinet options, including anything from a standard pie warmer through to complete modular systems with heated bain maries. There are self serve and full serve units, freestanding ones, counter top products – there are literally hundreds of options and combinations.

Suppliers will happily talk to individual operators about the food offer they are trying to achieve and their specific requirements.

Each site will differ due to available space, budget, food turnover and customer types. Suppliers seek to understand an outlet’s goals and put suggestions together on the best options for each store. They will quote based on the design and the best setup to suit the site and provide outright purchase price and leasing alternatives.

Choosing the right hot food merchandiser is crucial to the success of the category, but any machine will fail to do its primary job if it is left unstocked or unclean. For the price charged in store, the public rightly expects quality food and appearance. C&I outlet operators cannot afford to let them down.

Staff training is very important. As with all food offerings, basic food handling skills such as how to store frozen product, thaw product, stock the machine, and how to monitor temperature and quality during the day will all have to be learned – the same as with all food offerings. Perhaps, most importantly of all though, staff need to be made aware of the critical and growing importance of being on top of cleanliness and stocking at all times. It is not simply a matter of hygiene, it is a matter of sales.

The level of maintenance and cleaning required will of course depend on the cabinet chosen and the amount of food sold at a particular outlet, but it should not be a big issue if properly managed. Staff levels will also differ a little depending on whether the chosen cabinet is self serve or full serve, but again maintenance and staff interaction is minimal.

Getting it Right

Another big concern for many operators as they consider extending their hot food offer is waste, but it is common to underestimate the ability of a cabinet to maintain freshness and thus keep wastage to a minimum.

Outlets don’t need to be constantly cooking to have a fresh hot food offer, they just have to have the right cabinets that keep their cooked food fresh for longer.

One of the most staple items in a C&I outlet, the humble meat pie now can be wrapped, unwrapped, preheated in an oven or microwave, and sold in high volumes or low volumes. There are equipment alternatives around to suit all scenarios. There isn’t one solution that suits all operators and it pays to consider carefully what the requirements will be very early on in the process.

There are plenty of issues for outlets to consider when assessing what hot food equipment would best suit their needs. Some good advice when analysing hot food merchandiser options are:

• Don’t choose a cabinet that is too big. A smaller cabinet looking full is better than a big cabinet looking empty.


• Choose a cabinet that will maintain freshness, reduce waste, but also allow more food on display in the in-between times – it will deliver sales.


• Position in the path of customers, if possible near the register area.


• Keep the unit clean – it goes without saying.


• Pair products up, create your own combo packages, food, drink and chocolate offers, special deals, two for one offers, it all drives sales.

Of course, the selection of a hot food merchandising solution is not the end of the matter. Customer flow, product placement, and the impact of store design all have a huge effect on sales. We are also seeing a trend towards zoning a C&I outlet into areas of food-for-now and food-for-later which is helping to focus the customer on the choices available.

Bright and effective point of sale material utilised both inside and outside the store are proven sales drivers. Store location, size and customer profile are other factors that will impact on potential sales of hot food, but it really is getting the basics right that maximise the category’s potential.

Regular cleaning of equipment is vital, as well as maintaining stock weight, especially at peak times. It is critical that convenience outlets maintain adequate stock to meet demand as no one can sell a product that is not on the shelf.

A good hot food offer will naturally generate extra sales in other categories. The most obvious example is drink sales as the majority of people tend to also buy a drink with food. Bundling and combo deals are a good way to capitalise on the possibilities.

However, extending a hot food offer can also lead to a sales spike in the sales of the existing hot food products. C&I operators have found that extending their hot food offer beyond staples such as pies has actually lifted the sales of pies themselves. The lift can often by as much as 20-25% depending on how the operator displays and merchandises the pies and hot food.

When a store becomes a destination point for food, customers go there and then decide what they will buy. If only pies are on offer, the customer has decided before they enter the store, and will enter less frequently than they would have if they had more choice available.

Everyone is a Potential Customer

So, while pies, pasties and sausage rolls remain the most popular hot food in convenience, it certainly shouldn’t preclude the selling of pre-packaged items such as hot sandwiches and burgers.

Identifying the needs of the customer base is crucial to determine the best approach to selling hot food. There are many hungry customers at various times of the day and convenience and impulse outlets are highly accessible to our mobile population.

Hot food customers are anyone from tradespeople, mums, travellers, school kids, local residents and travellers. Different sites in different areas will have their own make-up of customers.

Hot food buyers are both destination shoppers and impulse buyers. This can be dependent on the location of the C&I outlet and the way hot food is presented and merchandised.

For example, a site in an industrial area will have strong morning tea time and strong lunch business from the surrounding workers, whereas a site situated near schools will be strong in the morning and again in the afternoon with the school kids, and with mums either side of the those windows.

Everyone is a potential customer, and outlets may need to differ the offer slightly, and the windows of time during the day that the merchandiser is loaded up with product to suit.

While prime time for food sales can be said to be breakfast, lunch and dinner, also maximising the potential of snacks and impulse sales is vital to the success of the hot food offer.

Building a reputation for having a good hot food offer will bring customers to store specifically for that reason, but some operators don’t realise the potential of hot food sales outside of meal times and the impulse sales that can be generated.

If the merchandiser is positioned properly in-store, the food is on display and looks fresh, then a large portion of hot food sales will be from customers buying a snack outside of meal hours.

Of course, this is where having a good merchandiser that keeps food fresh comes into its own. It allows outlets to have food on display all hours and thereby capture impulse sales. Operators that are concerned about waste don’t display in the in-between hours and consequently don’t get those extra sales.

This then is the secret: achieving these in-between high-margin sales increases the customer average spend, creates loyalty, and can help achieve further add-on sales. In other words, converting the presence of customers already in the store paying for their fuel or grabbing a newspaper into a food customer can turn a good category into a great category. And that could get your store’s bottom line cooking on gas.

* C&I Retailing would like to thank Future Products Group (FPG), The Perfect Fry Company, Avem and Patties for supplying information for this article.