The Bricks & Mortar Opportunity

07 April 2022, 07:37 AM
  • E-commerce may have been the runaway success of lockdown, but there’s plenty of scope to maximise walk-in stores too, finds Ellen Manning
The Bricks & Mortar Opportunity

The way consumers buy their food has changed beyond imagination over the decades. From small, artisan shops to huge multiples, then back again as people rediscovered their love for quality, artisan food produced and sold on a smaller, more personal level. The buying process itself went from choosing meat, bread and cheese from a counter to picking up pre-packaged offerings from a supermarket shelf. People have paid more, paid less, and now for many products are paying more, either out of choice or necessity. Shopping has moved from the high street to cavernous out-of-town locations, changing the shop experience beyond recognition. But despite all those changes, one thing has remained constant - the ability to buy food from a shop. To walk through its doors, browse a display of some form or another, and walk out with goods.

Until 2020, when the simple act of walking into a shop became either forbidden or worrying. The shift of the way shoppers shop due to the Covid pandemic has been well documented. An unprecedented situation saw a surge in online shopping - including in the speciality food sector. As online sales soared, fine food businesses who had previously swerved the world of e-commerce embraced it, setting up websites and marketing their wares to an audience desperate for the comfort of their favourite meat, bread, cheese and other artisan products in whatever way they could get their hands on it.

The shift helped myriad small businesses survive the pandemic, but where would it leave the future of bricks and mortar within the fine food sector? In December, Simon Latham, a senior manager at 4C Associates, predicted in Speciality Food Magazine that the growth of grocery sales made via online channels had presented an opportunity to minimise and optimise utilisation of bricks-and-mortar premises. His predictions might have sparked a shiver of fear in some business owners, but figures suggest while online sales are still high, customers may still prefer the in-person experience that is particularly enjoyable when it comes to shopping for food. Data shared with The Grocer by NeilsenIQ in October suggested that fresh food’s share of online grocery sales still lagged behind store sales, with NielsenIQ’s new Ecommerce Benchmark finding that fresh food accounted for 34.9% of sales online compared with 43% in-store.

How to sell IRL
Food retail expert Stuart Gates, there is still very much a place for bricks and mortar in fine food. For Gates, who advises and mentors artisan producers, retailers need to look at the overall picture, rather than seeing their physical shop as separate from an online presence, and also separate from any food service aspect they may introduce. “Often retailers see a shop on one corner, the internet on another, and possibly a cafe on another, rather than an overall strategy.

When Covid happened in 2020 most delis and speciality food shops had been concentrating on their foodservice offer rather than the internet. They hadn’t come up with their marketing and that side of the business so there was a lot of focus on that. But I think people still want to visit a shop so if you’re clever you use your retail shop as a showcase and the shop can be used to drive your internet business or seasonal business. You use the fact people love coming to a shop to then encourage them to fill a card in or get their email address and then drive that customer loyalty.”

In Gates’ view, the key is in making bricks and mortar valuable - giving customers what they want from a food shopping experience. “I don’t think speciality food retailers need to be afraid of price, because if it’s good enough and tastes good enough, people will spend money on it. But I think people want to be excited when they come into shops.

They don’t come into shops because they don’t want to - they want to buy something, they want to look or be thrilled or discover something new.” He cites speciality cheese shops as a good example, selling products people can’t get elsewhere, but also doing what they do well, offering customers a unique experience and great products. “The main thing is you have to be good at what you do, communicate what you do and be proud of what you do.”

A chance to connect
When it comes to butchers’ shops, the bricks and mortar experience allows the building of a rapport and relationship between customer and butcher that is much more difficult to build virtually, says Robert Unwin, owner of Kendal-based Roast Mutton. “If you go back 60/70 years nobody went to a supermarket, people went to their butcher, which meant the layman on the street was quite well versed with different cuts, especially cheaper cuts to fit budgets. But the growth of the supermarkets means a lot of that knowledge has been lost, so I see the bricks and mortar shop for a butcher’s shop as an educational piece as well. There’s a lot of communication, a relationship to build with the butcher, and obviously it’s not as easy to do online.

That knowledge and education is particularly important in the aftermath of the pandemic, says Unwin, which has seen the rekindling of an interest in cooking and ingredients. Having people in a shop allows a bucher to advise on different cuts and alternatives, says Unwin, who also offers regular butchery classes, enjoys the aspect of explanation. But it also allows him to inspire, either through his display or through conversations and suggestions with customers. “I put different cuts out and that starts a conversation. The physical shop is really so we can talk to someone in person. I’m not saying it can’t be done online but it’s a hell of a lot easier to speak to someone - you build a rapport straight away.”

Shane Godwin, managing director at Macknade, agrees. “Being able to create a space that our customers are comfortable to spend time in is something that we understand and we believe in,” he says. “These face-to-face experiences help to build communities in the physical space, increase dwell time and allow our team to have a prolonged customer experience themselves, adding to their enjoyment. While online continues to grow and us with it, finding the balance between simple transactions online and the physical experiences is something we feel we are achieving and want to do more of.”

On top of in-person rapport, there is the basic logistics of online trading to take into account, says Unwin. “It can be a false economy. Someone can come into the shop and spend maybe £150-200 at the weekend. They come in, pay the money, and walk away with their meat. With online you have the order, then you may have to have a conversation, then you have to organise delivery and logistics.”

On top of that, a small artisan butcher could get lost in the sea of businesses that can be found online, compared to the ability to stand out if in the right location. “I’m sure there are pros and cons, but when buying meat online, someone really has to want to buy meat from you.” In contrast, Roast Mutton’s physical Lakeland location, where a lot of its meat is from the local area, is a draw for customers and allows it to stand out.”

For Lac Hincu, owner of the Revel Bakery in Rugby, Warwickshire, which sells online but also shows off its wares in its shop, Revelicious, the benefits of bricks and mortar are extensive. “Our shop has been slowly growing and 6 years later we couldn’t be happier with its evolution,” she tells Speciality Food. “Even though we think adapting to new technologies and embracing new ways of trading is important, having a shop it’s vital for us and our community.” That importance of community was highlighted in the last couple of years, says Hincu. “A large number of our customers are elderly who felt comfortable visiting our shop in a safe manner. Many of them didn’t feel comfortable shopping in big supermarkets and don’t have access to an online ordering system and they would’ve been completely excluded if we only offered online shopping for example. At the other end of the spectrum we usually employ very young people in our shop. For many this has been their first job or come and help during university breaks. This is incredibly rewarding for us and important for the economy in general.”

That personal connection to the community aside, Hincu echoes Gates’ view that it’s all about experience. “Visiting a bakery is an experience in itself. It’s about the smell of fresh bread and pastries, the visual of the cakes, chatting with the people behind the counter - something that just clicking ‘add to the basket’ can’t replicate.”

A rewarding investment
Operating a bricks and mortar presence in the current climate isn’t easy, Hincu will admit, but is important not only for her own business but for the bigger picture. “It’s no secret that having a physical shop is incredibly challenging in the current climate but it’s also very rewarding. It gives you a chance to engage with the community you are part of and gives your business an identity that people can easily recognise. Another plus is that it helps the local economy and makes the town centre look diverse and more attractive for people to visit which is vital for any small market town if we don’t want another ghost town centre.”

At Bowhouse in Fife, a hub for food production and development that aims to connect makers with local suppliers and shoppers, the in-person experience is clearly important. Bowhouse is home to seven independent businesses including a flour mill, brewery and butchery, and also holds monthly market weekends. Its newest project is the transformation of its courtyard space to create three new production units to create three new production units which can be used for small-scale retail and production of local food and drink. While bricks and mortar is at the heart of what it does, like many other businesses Bowhouse had to adapt during the Covid pandemic, says manager Rosie Jack. “When lockdown measures were in place, our customers and producers were struggling to trade using the bricks and mortar experience so we founded the Bowhouse Link, a virtual food market on the Open Food Network. We will continue to offer this service as there is still a market from our users who visit Bowhouse and still want the easy access to locally produced food and drink for home delivery or collection from the food hub each Saturday.”

Despite that, the bricks and mortar experience remains vital, especially when it comes to speciality food, she says. “A bricks and mortar experience at Bowhouse is so important for engaging conversations and food and drink. Having a physical unit means consumers can visit the production space, meet the maker and purchase onsite rather than only having access to a description from an online listing. Sharing the story behind a product, the people involved, where the ingredients come from and how they have been prepared are vital tools for speciality food makers in order to help consumers make an informed decision and support sustainable food and drink production.”

So where does the future lie for bricks and mortar? “As online continues to grow, there is a balance to be struck, as customers still desire the physical experiences,” says Godwin. “For small businesses, the online investment required to compete with the bigger operating models can be prohibitive, but more importantly, simply providing the same products online doesn’t necessarily transfer into sales online. The market for online customers for an independent, SME is seldom the same as within the physical space and the balance here is where skilled operators will embed themselves to thrive.”

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