Time and time again we were told people couldn’t afford to shop in their community stores. In 2017 we started researching. We wanted to know if a people could feed their family with affordable and nutritious food if they shopped in their community store only.
After research which scrutinised store prices, products, supply chains and the negative impact of rebates on prices in store, we made the call that no, people couldn’t feed their family with affordable and nutritious food, which goes to the very heart of food security – changes had to be made.
Imagination and determination to bring down prices
We manage supply for four stores in Timber Creek, Barunga, Balgo and Yarralin, and set about finding ways to protect the food security in our stores. We figured part of the process of protecting food security more broadly was to create a model of best practice – to show what can be done with imagination and determination for positive social outcomes.
One solution has been to introduce a discounted range; similar to what Coles and Woolworths do. Our range is called Mob’s Choice and all products in the range are tagged with the Mob’s Choice logo which indicate good value for money.
How can discounts equal profit?
A fair question has been how the store would make any money if the products that make up most of the sales in the store are heavily discounted. Isn’t that financial suicide? We believe the answer is no. We believe that if we could capture the trust of people shopping in the stores, then it would be viable – its just a matter of numbers or economies of scales. The more people who shop in the stores, the less we could charge for products without negatively impacting store profits.
And the result?
Looking at the data from last financial year, Bagala Community Store in Barunga made $394,668 in sales in the third quarter and $801,707 in the fourth quarter. Wirib Community Store in Timber Creek made $176,994 in the third quarter sales and $495,998 in the fourth. Convinced?
Since introducing Mob’s Choice, fruit and vegetable sales in Bagala Store has increased 161% and 148% in Wirib Store and the overall sales of Mob’s Choice range has increased by 29% in Bagala and 48% in Wirib.
We have no doubt that firstly people want to buy and eat fruit and vegetables. Secondly that people are willing to buy from their community stores if the prices are reasonable.
Building shopper confidence through value for money
This touches on an interesting point of building shopper trust through value for money. The branding of Mob’s Choice has been a deliberate move in cultivating shopper culture in the stores we manage. We’re using the same tricks as massive supermarket chains but turning them on their head. Instead of putting profitable products at eye level in store for example, we have low profit, healthy products at eye level.
Best practice model to create widespread change
Mob’s Choice is one of our more successful solutions to food security and, we’re hoping our modelling for social outcomes over profit will be something other store management groups are willing to try.
