Landmark Wholesale’s Hot House programme was set up with support from 16 suppliers, including Mars, in mid 2004 in a bid to help regenerate the independent retailers who make up many of its members’ customers.
Four years on the scheme has won numerous awards and now has 48 suppliers signed up to provide long-term support and financial backing, but most importantly it has produced average uplifts in sales of 29% for the 1,352 stores which have signed up for the scheme so far.
Although Hot House has developed to provide additional services, at its heart is a ‘makeover’ of each store that is tailored to provide the optimum range and merchandising so that it can realise its maximum sales potential. Raj Krishan, retail controller for Landmark, says: “We provide best advice to our retailers so they know what are the right ranges in terms of product, and the right layout in terms of maximising sales.”
The basis of the makeover is category planograms that have been developed using actual sales data and agreed by leading suppliers operating in that category.
Trina Schofield, the national account manager at Mars who manages the Landmark Wholesale account and leads its work on the Hot House scheme, says: “Mars is very supportive of anything that is trying to rejuvenate the independent sector, so right from the beginning it was something we were happy to get involved with. We’ve been part of the planogram process on an annual basis since the programme began, so we’ve worked quite collaboratively with Landmark and the other suppliers to formulate a category planogram.”
Krishan adds: “This has really been a step change as far as confectionery has been concerned. To get a category approach is almost unheard of, so it’s very positive.”
Once retailers have signed up for the programme, the planograms are tailored to their particular store’s dimensions and customer base and the refit only goes ahead once they are fully in agreement with the proposals. After the merchandising team have carried out their work, however, the retailer needs to maintain the layout in order to keep reaping the benefits and this is an area of vulnerability for the scheme. Krishan says: “Inevitably there is a bit of slippage involved. The retailer implements it but there are seasonal changes, different members of staff, and all this can muddy the waters.” While many retailers in the Hot House scheme keep to the planograms, some find it difficult to maintain the necessary discipline, and this prompted Mars to come up with a proposal to help the retailers who were struggling.
Schofield explains that Mars’ 300-strong ‘feet on the street’ team were calling on Hot House stores as part of their programme to provide retailers with information about how they could increase their category sales. She says feedback from the team identified a group of retailers where implementation of the confectionery planogram was not being correctly maintained and there was therefore an opportunity to improve sales.
Having identified stores in a number of areas, Schofield went to Landmark with a proposal that would harness the unique relationship between the wholesalers and their customers to help get the retailers back on track. She proposed a ‘blitz day’ when Mars sales representatives would team up with the wholesalers’ business development managers to visit the retailers and offer to relay their confectionery fixtures. She says the presence of the wholesalers’ business development managers, many of whom already had a relationship with the retailers, would make the retailers much more receptive to the proposals.
Schofield pitched the idea to Krishan, who she says was very supportive, and then presented it to Landmark’s members, and came back with agreements from most of Landmark’s cash and carry companies to take part. “All of them without exception were very happy for their business development managers to take part,” she says. The ‘blitz’ took place on a single day in June last year, with nearly 50 people involved, including 22 people from Landmark’s head office and its members. They split up into 12 teams, covering areas in the Midlands, the North East, and Scotland, and called on a total of 120 retailers.
Schofield says: “The business development managers were able to explain to the retailers that we had identified an opportunity in their store and Mars were on hand to relay on their agreement at a time suitable to them.” Mars trade relations manager Bep Sandhu adds: “Doing it together made such a difference for the retailers, knowing that they had someone who was impartial on confectionery alongside an expert.”
As a direct result of the blitz, 55 retailers had their confectionery fixtures relaid in the following fortnight. Schofield and Krishan say they were both very pleased with the results. Krishan was also impressed when the sales figures came through for the following period showing a year-on-year uplift for the confectionery category of 21.9%. “While this was not due to the blitz day alone, it was definitely one of the factors that helped,” he says.
Schofield says there were also other benefits from the day with it fostering much closer relationships locally between the Mars team and the wholesaler.
Landmark members who took part in the initiative were also pleased to have an opportunity to team up with a supplier to help their customers. Peter Lowrie, managing director of Lowries Wholesale, comments: “Landmark’s Hot House scheme is excellent as it gives our retail customers access to the latest research on layout and range optimisation from leading manufacturers. We realised that some of our retailers were struggling to provide the right range and therefore not optimising their sales from confectionery. The relationship we have with Mars is invaluable, and they immediately offered us a tailored solution.
“The Blitz day was particularly successful as Mars representatives worked closely alongside our own business development managers. Mars took the time to explain to individual store managers and owners how they can drive sales from confectionery and made a really positive difference in store.”
Following the success of last year’s event, a similar initiative is planned this summer, but Schofield says there are likely to be some changes as a result of learnings from last year. She says trying to arrange the entire event across eight or nine wholesalers on a single day made it unnecessarily complex and so it may be staggered across several days. Also the first event was managed from the centre, but now the teams have seen how it works she believes it will be possible to give them more local ownership.
Mars and Landmark have worked closely together on Hot House and the blitz days, but both Krishan and Schofield emphasise that their companies are keen to develop similarly close relationships with other players. Krishan points out that through Hot House Landmark is working closely with 48 suppliers, and would welcome more. Schofield says: “This shows the kind of assistance we can give. We are happy to help other wholesalers who have the same intentions in terms of driving discipline in retail and improvements in store standards.”