By Tony White
As we reported in our Annual Report, we are making changes to our Community Market on Lyme Road in response to continuous poor financial performance.
Our original plan to provide a financially viable full-service community market is not working. To continue to run the same business model is not feasible. Although some members use the Market as their main food store, most use it as a convenience store.
We are implementing changes to the operation of the store that are more in line with how most members use it. We realize that our changes are not perfect. We plan to solicit your feedback to help us evaluate these changes over the next few months. Hopefully we can turn this location into a profitable store while also meeting many of your wants and needs.
Improving the financial performance of the Market requires adjusting sales, labor costs, and gross profit. To achieve this, we are making the following significant changes:
Reduction in store hours: Early morning, late evening, and many weekend hours of operation have inadequate sales to justify the labor required to remain open. At this point, we have only changed our opening time from 6:00 a.m. to 7:00 a.m. However, we will continue to review store hours as the seasons change and sales fluctuate.
Reduction in hours of deli operations and eventual closure of the department: Our deli department has not generated the sales that we anticipated. As a very labor-intensive department that requires staff available at all times to wait on a customer, its sales do not justify keeping it open. Instead, we will have a very limited amount of deli meats and cheeses available for slicing in our new sandwich shop.
Sandwich shop: This fall, we will do a small remodel of the deli area and open a made-to-order sandwich shop. Starting out, we expect to operate the sandwich shop Monday through Friday from 10 a.m. to 4 p.m. and, perhaps, 10 a.m. to 2 p.m. on Saturdays.
After we have operated this new part of our business for a period of time, we will be looking to expand the hours of operation to include some evenings. As part of the expansion to evening hours, we will introduce new dinner themes. We are exploring ideas such as taco night, pasta night, and a Friday night fish-fry.
Ice-cream, frozen custard, or frozen yogurt stand: We have been experimenting with recipes and fully expect to have a dynamite product to be introduced sometime later this year or in early 2013.
Change in product selection: As stated previously, the majority of customers have been utilizing the Market as a convenience store. The amount of products was time-consuming to maintain and not representative of what was being purchased. We have made significant changes in the product line that we expect will drive profitability, yet still provide a variety of choices. Our new selection has fewer choices per category, but we have retained our best-sellers for each category.
Changes in pricing: Selling products at the Market is more expensive than it is in our larger stores, and we need to adjust our retail prices to reflect the cost of doing business there. Late this summer or early fall, we will be changing the pricing on many of the items sold in this location, and they will no longer be the same as those found in our stores.
No more sale items: Likewise, the cost of doing business at this location makes it cost-prohibitive to honor advertised specials. We expect to have some specials for the Community Market only, but items on special at other Co-op locations will no longer be on special at the Community Market.
Product returns: After the new pricing structure is in place, the Market will only be able to accept product returns on items bought at the Market. Likewise, products purchased at the Market can only be returned there and not at the larger stores.