Refresh, Remodel, New Stores - The Design Associates, LLC

thedesignassociatesllc.com

Refresh, Remodel, New Stores - The Design Associates, LLC

Refresh, Remodel, New Stores

Terry Roberts

President/Owner

The Design Associates LLC

est. 1994

Merchandising By Design Inc.


Refresh, Remodel, New Stores

In any economy, focusing budgets

where they will provide the best ROI is

essential. Learn how store planners

are keeping capital costs down by

putting their focus where consumers

focus – at "10’& feet and under."

Simplifying buildings, finishes & decor

to provide focus on merchandising,

traffic planning, fixtures and – what

consumers notice – are key ingredients

to refreshing, remodeling or building

stores at lower costs.

The Design Associates LLC/Merchandising By Design, Inc.

10’ and Under

Today’s Business Climate

Where I’d Spend My First Dollar

Refreshing Center Store

Remodeling For Huge

Sales Increase

Best Interior Design -Independent

New Store

Spend Down-Not Trade Down

On Trend Store Planning Check List

2


Developing Programs, Products & People

Prior to 1994, Terry Roberts was on staff with one of the

industry's most distinguished leaders, Wegmans, for 12 years,

working in many areas of operations, training, buying,

management and store planning. During Terry’s tenure with

Wegmans, of Rochester, NY, her positions included six years of

project development and management in perishable

departments, most notably on the development teams of the

acclaimed Market Café, as well as six years in hard goods

categories and visual merchandising. Terry came to Wegmans

after 10 years with Rite Aid Pharmacies in positions ranging

from store acquisitions and planning for 13 states, to senior

training manager for upstate New York.

While it has no publicly traded stock, its operating

margins are reportedly about 7.5%

(the company will not disclose net margins), double

what the big four grocers earn and higher even than

hot natural-foods natural foods purveyor, Whole Foods.

Wegmans sales per square foot are reportedly 50%

higher than the $9.29 industry average…..

average ..

Programming & Visual Merchandising

Merchandising By Design, Inc./The Design Associates tdambd@aol.com


Wegmans….Brand Is Everything

10’ & Under Focused

Experience

&

Convenience

The #1 And #2

Reasons Why

Consumers

Remain Loyal To

A Particular

Retail Brand

The Design Associates LLC/Merchandising By Design, Inc.

DETAILED

DESTINATION

COMPARTMENTALIZED

There Is No Alternative To Experience

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Merchandising By Design, Inc.

Terry Roberts, president

Over 30 Years Of Experience In

Successful Store Planning,

Design Projects & Positions For

Supermarkets & Specialty Food

Stores

eatZi’s, Wegmans, Rite Aid,

Thornton Quick Café’,

SUPERVALU,

Scott’s, bigg’s, Sunflower

Markets,

Cub, Delhaize, Dean & DeLuca

Shell/Texaco,

Genuardi’s/Zagara’s

Campbell Soup Company…..

Delivering

Plans & Programs That Are…

ROI Focused

Community Tailored

Operationally Sound

Flexible To Evolve

Innovative & Progressive

Interactive & Entertaining

There Is No Alternative To Experience

Merchandising By Design, Inc. , 2633 Elmbrook Dr., Carrollton, Texas 75010

Phone (214)-883-5013 * Office Fax (972)307-3180 * tdambd@aol.com

Est. 1994

New & Remodel Store Planning

AutoCAD Equipment Plans

Interior Design Detailing

Brand Development

Fixture & Signage Specification

Equipment Specification

Sourcing

Visual Merchandising

Project Coordination W/Architects,

Engineers, Suppliers, Contractors

Program & Product Development

Food Service Planning & Handling

Training & Training Materials

Installation & On Site Support


There Is No Alternative To Experience

AutoCAD Fixture & Equipment Plans

Delhaize

Merchandising By Design, Inc. , 2633 Elmbrook Dr., Carrollton, Texas 75010

Phone (214)-883-5013 * Office Fax (972)307-3180 * tdambd@aol.com

Marsh

bigg’s

S

u

p

e

r

m

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r

k

e

t

s


Convenience Stores

The Design Associates LLC/Merchandising By Design, Inc.

Convenience Stores

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The Urban

Niche Market

The Design Associates LLC/Merchandising By Design, Inc.

"Improving sales, profits and ROI

was made possible by utilizing

the experience and talents of The

Design Associates professionals,

in providing best in class

programs, training and leadership

development.“

Jerry Porricelli, President

Porricelli's Markets

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Campbell’s

Supplier View Of

10’ and Under

Merchandising

BRAND is

EVERYTHING

The Design Associates LLC/Merchandising By Design, Inc.

Décor $5.00 SF

Store Planning By

Terry Roberts

& Dave Falt

The Design Associates LLC

Décor $5 SF

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The Design Associates LLC/Merchandising By Design, Inc.

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H I F T H A P P E N S

The Design Associates LLC/Merchandising By Design, Inc.

Dow Jones 9/2007-7/2010

82% Retail CFO’s Expect Ongoing Stagnation Is Most

Likely

Another 9% Project A "Double-dip" Recession

BDO USA 9-16-10

11


Succeeding in a Tough Economy

A&P Store closings highlight struggles

Safeway 4 th qtr 2009 net loss $1.6 billion

Winn Dixie 2 nd qtr earnings ending 1/2010 slid 87%

On the other hand……………….

Family Dollar Q2 2009 profits up 33.3%

Costco Q2 net income up 25%

Wakefern 2009 sales up 10.4%

The Design Associates LLC/Merchandising By Design, Inc.

Willard Bishop Competitive Edge 3/2010

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2009 Dollar Sales

The Design Associates LLC/Merchandising By Design, Inc.

SKU’S

� Traditional Grocery +0.9% 45,500

� Fresh Format +1.9% 30,000

� Limited Assortment +6.2% 1,400

� Super Whse +1.2 36,000

� Small Grocery +0.9% 3,000

� C-Stores(food) +0.2% 3,000

� Non-Trad. Grocery +4.8% 25,000

� Supercenters +7.8% 100,000

� Wholesale Clubs -0.4% 5,100

� Dollar Stores +16.8% 5,400

Willard Bishop June 2010

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Really!

That Explains

Everything!


By 2014 Grocery

Market Share -3.5%

The Design Associates LLC/Merchandising By Design, Inc.

Walgreen spokeswoman

confirmed the test and said the

fresh food initiative could help

the drugstore chain be

eventually seen as "destination

for tonight's meal."

Dow Jones News Wire 7/2010

� Traditional Grocery expected annual growth 0.2%

� Limited Assortment expected annual growth 6.5%

� Fresh Format expected annual growth 1.7%

� Supercenters expected annual growth 7%

� Dollar and Wholesale 2.8%

The Future Of Food Retailing Report

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Recession Fundamentals

Price Price

Impact Impact

Dollar Dollar

10

Limited Limited

Asst. Asst.

Club Club

Traditional

Traditional

Super Super

Whse.. Whse

CC--Store Store

The Design Associates LLC/Merchandising By Design, Inc.

Fresh Fresh

Small Small

Grocery Grocery

Drug Drug

Store Store

Despite efforts by Cstores

to become more

female-friendly with

brighter lighting, cleaner

facilities and more

prepared foods, women

find it easy to resist their

charms.

84% of women do not

shop in convenience

stores more now than

they did two years ago…..

SupermarketGuru.com

55% 55% of of Consumers Consumers Will Will Shop Shop At At Least Least

X 3 3 Channels Channels On On A A Weekly Weekly Basis Basis Looking Looking For For VALUE VALUE

SymphonyIRI Group

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“Economic Sobriety”

Formats Must

Constantly Evolve

Now Less Than Two Years

Before We See Sales

Declines!

“With debt-riddled Americans saving more, earning less and unable to

use their devalued homes as piggybanks, experts … see no return to the

Go-Go days of consumption”

The Design Associates LLC/Merchandising By Design, Inc.

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Bill Lucas, group president, NPD Group.


Defensive vs. Offensive

Remodels

Changing consumer needs 30.6%

Policy/time 36.1%

Competition 19.4%

Other 13.9%

“In the midst of the worst economy in decades it is especially important to

keep a finger on the pulse of consumers”

The Design Associates LLC/Merchandising By Design, Inc.

FMI Facts About Store Development 2008

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Changing The World

The Design Associates LLC/Merchandising By Design, Inc.

Today self-service remains one of the

Top 10 Ideas

that are changing the world…

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Consumer’s Expectations

for Self-Service…

Buying Groceries

at Self Checkout

Buying Fuel via

pay-at-the-pump

Accessing

Government

Services

The Design Associates LLC/Merchandising By Design, Inc.

Performing Banking

Operations at ATM

Checking in at

Hotel, Airport

or Rental Car

IBM Survey of over 1,000 consumers:

69% indicate they expect more and more businesses to offer a self service option

52% indicate they are very comfortable using self service technology

Roughly 50% indicate their usage of self service devices has gone up over the past year

Over 33% of consumers would like additional resources available to them while they shop

Only 4% of consumers indicate they are not using automated devices/kiosks

Guided Selling

in Retail

Checking in and

Monitoring for

Healthcare

Gaming and

Entertainment

Quick Self-

Order

Checking in

at Day-Care

Printing

Photos

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2 Out of 3 Consumers Acknowledge

Speed & Convenience of Self-Checkout

68% site speed or

convenience as the single

most important reason

they use the SCS lane

IBM Institute for Business Value “Consumer Advocacy” survey and study, 1/2009.

The Design Associates LLC/Merchandising By Design, Inc.

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Reduce Costs, Improve Sales And

Boost Customer Loyalty

Deli Express Order Kiosk

20-25% of sales $ thru kiosk/ Avg $6-$8

Two sided refrigerator unit to hold orders

Assign clerk for peak hours

“Huge opportunity in additional sales

from customers who would not wait if the

deli is busy and the productivity

improvement is worth 1.5%

of deli payroll”

The Design Associates LLC/Merchandising By Design, Inc.

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Make Really Tough Decisions

The Design Associates LLC/Merchandising By Design, Inc.

How Well Do Categories

Really Perform?

Coffee Bars

Floral

Tortilla Factory

HBC

Furniture

Juice Bars

Dining Areas

…………..

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Defensive-Center Store Refresh

Total Center Store Refresh $230,000

The Design Associates LLC/Merchandising By Design, Inc.

$100,000: Equipment, fixtures, labor

(add in lost sales and loss from markdowns)

Assumption: store sales $500,000 week

Typical center store generates 3% lift in sales

Recover investment in approx. 7 months

Willard Bishop optimization work

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“Absolutely True”

John Domino, former SVP SuperValu, DSG

� First dollars in:

� Clean store (and coat of paint)

Refresh/reset center store

� Re-lamp and/or upgrade lighting

New/add refrigeration (dairy, frozen,

prepared foods)

� Last dollars in:

� Deli, bakery remodels

The Design Associates LLC/Merchandising By Design, Inc.

Payback

1-2 years

Average remodel $3.5m (loss sales/markdowns $3.7m

Average sustainable sales lift 7%

Payback

Negative

Sales volume $500,000 expect to recover investment in 7 years

Willard Bishop Competitive Edge 7/2010

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Refresh Really Is:

New Product and

Right Products

Relevant Assortment

The Design Associates LLC/Merchandising By Design, Inc.

Suppliers Step

Up Shelf Sets

Campbell’s

Shelf

Maximizer

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Just a few degrees in temperature

rise on the surface of a seafood

display can increase the growth

of bacteria exponentially.

The Design Associates LLC/Merchandising By Design, Inc.

Lighting

Innovation

100% LED-interior and exterior.

Amerlux LED

50,000 hour life at 70% of initial

output, no projected heat, very low

UV emission, output close to

ceramic metal halide.

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Destination-Center Store

The Design Associates LLC/Merchandising By Design, Inc.

You Don’t Lose

A Sale…You Lose

An Entire Trip

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Companies Like Wegmans Place

Nonfoods Squarely In Center Store

With Amazing

Buying

&

Merchandising

The Design Associates LLC/Merchandising By Design, Inc.

Stemware

Dessert plates

Tea Pot

Pasta bowl

Serving bowls

Drinking glasses

Meat thermometer

Salad tongs

Casserole dish

Gifts: Placemats/napkins

Aprons

Serving spoons

Wood cheese board

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Frozen

65,000 SF Fresh Prototype

Kitchen Shop

Nat/Org

Cards Cheese

HBC

RX

RX

�Adjacencies

�Transitions

�Flexibility

Meat Seafood Prod. Prep

Deli

Coffee Bar

Floral

Wine

Prepared

Quick Cafe

Merchandising By Design, Inc. , 2633 Elmbrook Dr., Carrollton, Texas 75010

The Design Associates LLC/Merchandising By Design, Inc.

Phone (214)-883-5013 * Office Fax (972)307-3180 * tdambd@aol.com

Produce

Bakery

Juice

Bar

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25% Increase In Need For

Refrigeration In The Last 5 Years

The Design Associates LLC/Merchandising By Design, Inc.

Dairy dramatically

outpaces other

departments with new

product introductions

91% of all households

buy fluid milk

One of every two trips is

a quick trip and 40% off

all trips to the store

include a dairy purchase

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Establish A Destination Dairy Department

Deliver Stronger Fresh Statement

Merchandise To Health & Wellness

The Design Associates LLC/Merchandising By Design, Inc.

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Refrigeration

Innovation

� Superior Merchandising

� Up to 84% Annual Energy

Savings

� Up to 35% More Facings

� Up to 25% More Pack-out

Zero Zone

The Design Associates LLC/Merchandising By Design, Inc.

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Going Green &

Merchandising

Innovation

“Coolgenix” Hill Phoenix

Minimize refrigerants

Reduce leaks

Secondary refrigeration -med temp

C02 (testing in 2-3 stores -low temp)

LED case lighting (w/motion sensors)

Retrofit door kits

Superior Focus on

Perishable Merchandising

The Design Associates LLC/Merchandising By Design, Inc.

Barker Specialty Products

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Offensive & Defensive Remodel

$ 140,000.00

$ 930,000.00

$ 280,000.00

$ 40,000.00

$ 390,000.00

$ 650,000.00

$ 2,430,000.00

(same cost as 2007 FMI Store Facts)

The Design Associates LLC/Merchandising By Design, Inc.

5.7%

38.4%

11.5%

1.6%

16.0%

26.8%

Lighting

Refrigeration

Equip/Perishables

Shelving/ends/floral

Checkouts/Tech/Sec

Const/Paint/Tile/decor

PRICE &

VOLUME DRIVEN

WITH

w/SERVICE DEPARTMENTS

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Converting Cash To Contribution

Entire Remodel

6 Weeks

$2.4m renovation

The Design Associates LLC/Merchandising By Design, Inc.

Before remodel

$325k/wk

NOW $625k/wk +

Conventional Nat. Retailer

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Destinations Deliver

Center “Center store On center

store (grocery/dairy/FF/HBC/

applications or

remodels Nonfoods we is 62% had of store sales

placed (note this Kitchen store shops is next to

into Walmart another so HBC/Nonfoods site and is

had impacted). 60% sales lift in

these categories.

On center store remodels, we

placed Kitchen shops into the

stores and see a 60% sales lift in

these categories. ”

Spend Enough To

Make a Difference

The Design Associates LLC/Merchandising By Design, Inc.

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Merchandising Flexibility

Increases Profits

� Day Part

� Day Of Week

� Seasonally

The Design Associates LLC/Merchandising By Design, Inc.

Control

Labor, Shrink, Profits

Flexible Merchandising &

Multifunctional Fixtures

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Flexibility & Destination

The Design Associates LLC/Merchandising By Design, Inc.

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Promise *Dedication * Obligation

Train, train and train again!

The Design Associates LLC/Merchandising By Design, Inc.

The “P’s”

Innovative Products

New Programs

Hired 175 People

Solid brand Promise

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No right… No wrong…

Unless it’s half ed.

The Design Associates LLC/Merchandising By Design, Inc.

41


Best Interior Design

Dave’s Fresh Marketplace

The Design Associates LLC/Merchandising By Design, Inc.

Progressive Grocer

Store Planning By

Dave Falt

Creative Custom Design

(Bozzuto’s, Inc)

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Independent-Thinking Outside

& Re-Use of The Big Box

Dave’s Fresh Marketplace

Opens in former Linens ‘n Things

The Design Associates LLC/Merchandising By Design, Inc.

Smithfield

Crossing

Lifestyle

Shopping Center

36,000 SF

Avg. $500,000

$5.25 m/$150 SF

$5.25M Equipment ($150 $1.5m

SF)

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Dave’s Fresh

Marketplace

New-Ground Up

$ 4.2m/$170 SF

The Design Associates LLC/Merchandising By Design, Inc.

Quonset 24,000 SF

$4.2m ($170 SF)

Perishable Fresh Focus

Shopping Experience &

Merchandising Is Paramount

Destination Departments

Equipment $1.75m

Décor $ 11/SF

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Offensive

Merchandising

“Services and programs decisions are

an offensive move to capture high

end consumer left with little choice in

the competitive market.”

The Design Associates LLC/Merchandising By Design, Inc.

45


Produce

15%

Prep-Foods

Deli

5%

10%

Meat

15%

Seafood

5% Bakery

5%

Dairy

16%

Grocery

29%

The Design Associates LLC/Merchandising By Design, Inc.

1

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Fresh Format

Business Model

The very best in meat,

produce, prepared foods,

cheeses, baked goods,

gourmet and local products.

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Fighting For Neighborhoods

Right Sizing

Right Spending

“Working With Smaller Footprints, Reduces Risk”

The Design Associates LLC/Merchandising By Design, Inc.

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New Store- New Approach

Requirements For New Site Main Format Modifications

Reduce building costs

Focus on what customers

really notice

Keep the theatre and services

Easier maintenance

Lower energy costs

Increase ROI

The Design Associates LLC/Merchandising By Design, Inc.

Minimal architectural detailing

Eliminate drop ceilings

Use all fluorescent lighting

Eliminate hard walls where

possible

Eliminate hard tiles

Focus on merchandising

SAVINGS $350,000

$7.00 SF

50,000 SF

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“Peeling Back The Onion”

Fabric awnings vs.

metal ($45,000)

The Design Associates LLC/Merchandising By Design, Inc.

Marketplace

Eliminate

sky lights &

transom windows

Brick façade, metal sheeting

sides (savings $200,000)

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Spend Down-Not Trade Down

Power poles vs.

underground

wiring for front

end ($25,000 per

renovation)

The Design Associates LLC/Merchandising By Design, Inc.

Stainless steel

column covers

end 4’ above

finished floor

( $6,000)

Tile vs. Epoxy vs.

Seal Concrete

($12,000 savings)

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10’ & Under

Focus on Merchandising

The Design Associates LLC/Merchandising By Design, Inc.

Remove Bulkhead

over meat sales

($3,800 savings)

Expose cooler

panels, eliminate

tile ($3,000

savings)

Remove lighting over

bunkers ($15,000 savings)

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The Design Associates LLC/Merchandising By Design, Inc.

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Focus 10’ & Under

� Brand Is Everything

� Make Offensive Moves

� “Refresh” At Least Every 2 Years

� Make REALLY Tough Decisions

� Make Destination Departments

� Spend Down, Don’t Trade Down

� Minimize Expense On Buildings

� Focus: Where/What Customer’s Really See

“P’s”- Promise, Programs, Products, People

The Design Associates LLC/Merchandising By Design, Inc.

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�Convenience

�Personal Service

�Communication

�Coupon/Discount

�Kiosks

�Customizing/My Way

�Dining In

�Food Safety

�Employee Services

Labor Management

Loyalty Systems

Price Optimization

Business Intelligence

Loss Prevention

�Technology

�Self Service

SN, 10/09

�Health & Wellness

�Fresh & Quality

�“Green”-Sustainability

�Premium Private Label

�Simplified Assortments

Merchandising Focused - 10’ & Under


Thank You

& Thanks To The Many “Researchers”

Providing Data, Information And Photo’s

“To steal ideas from one person is plagiarism; to steal from many is research”

Steven Wright, the famous erudite scientist (comedian)

Terry Roberts

Supermarket & Fresh Food Store Planning & Design

Retail Business-Program Development & Training

There Is No Alternative To Experience

Merchandising By Design, Inc. , 2633 Elmbrook Dr., Carrollton, Texas 75010

Phone (214)-883-5013 * Office Fax (972)307-3180 * tdambd@aol.com * www.thedesignassociatesllc.com

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