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Patching up the Patch

Kelly Pate Dwyer

April 24, 2008

9 Min Read
Patching up the Patch

The managers of Nature's Food Patch, a small store in Clear?water, Fla., won the 2007 Delicious Living Retail Store Makeover contest held at Natural Products Expo East last fall. The retailer's name was selected in a blindfolded drawing from a group of qualified applicants—those independents that could demonstrate a strong need. The prize: $1,000 and the free advice of three natural products industry experts.

By now, one might assume the makeover is well under way or even complete, with some fresh paint, new signage and the like.

Not even close. Those very aesthetics and more are planned for Nature's Food Patch, but mulling color swatches and choosing light fixtures is a marathon, not a sprint, from the starting line. Save for a few exterior walls and the roof, the store's director, Laurie Powers-Shamon, and General Manager Rich Packman are in the throes of building a new store.

Practical, then pretty
The renovation—developed after three years of discussions and many months of drawing ideas on paper—aims first to fix problems of a business overburdened by its own success: a small space and an old building. Much of that time was spent on site selection, before a downtown revitalization plan and available space next door convinced Powers-Shamon and Packman to stay in a community where the store plays an active part.

The Patch, as some locals call it, so sorely lacks cooler space that staff members run out to a refrigerated trailer behind the store to restock bulk foods and bread.

That will change with an expansion that takes the store from 14,000 square feet to 20,000 square feet and puts more products on store shelves. Walls will come down and go up. The Patch will update heating, ventilation, air conditioning, plumbing and electrical systems. The retailer has reconfigured its layout to add a bakery and full-service meat department and expand its produce, grocery, body-care and nutrition departments. There will be a vestibule, an entry enclosed between sets of outer and inner doors, to address a problem of humidity in the store.

"We don't want to wait until somebody builds a 'bigger, better store' five miles away from us," Packman says. "Right now our customers are wanting [a larger, improved store]. Our sales are increasing and if we do it now, our sales will continue to increase."

Improving aesthetics is another big part of the plan, says Powers-Shamon, who notes, "The lighting in our store is like a bowling alley." The store was last updated in 1996, when it moved six blocks up the street.

Plans call for construction to begin in early spring with completion slated for fall. Powers-Shamon and Packman aim to use store revenue to fund the expansion and remodel. They aren't discussing budget, but the store's second-generation family owners, who are not involved in the daily operation of the business, have committed a signi?ficant amount of money to the project, Packman says. Also, United Natural Foods is providing discounted store-design services and the city of Clearwater will provide new streetscaping and landscaping out front as part of a downtown revitalization plan.

The experts
Powers-Shamon and Packman have several decades of combined retail industry experience, and long before they won the makeover contest, the Patch had architects and other experts on board. "I built this store and Rich has a real good background in project management," says Powers-Shamon. "I'm not looking for specific how-tos."

That said, the managers welcome the fresh perspectives of their industry comrades, natural foods retailing consultants Jay Jacobowitz, president of Retail Insights in Brattleboro, Vt.; Zedrick Clark, owner of Nature's Food Market in Berlin, Ohio, and chairman of the board for the Independent Natural Food Retailers Association; and Debby Swoboda of HealthERetailers in Stuart, Fla.

Jacobowitz is providing strategic, big-picture input. Clark's advice focuses on merchandising supplements and bulk foods, and Swoboda concentrates on signage and marketing messages.

At press time, conversations were just beginning among the store managers and industry consultants. Here are some of their initial thoughts.

The big picture
Jacobowitz agrees The Patch first needs to address mechanical and structural problems because they cause hardships for the staff, turn off customers and ultimately drain money from the business. That said, investing in aesthetics as well is not only ideal, but a competitive necessity for most retailers in today's market.

"Whole Foods' business model is facility first and product second," Jacobowitz says. "They depend on their beautiful facilities to coax cash out of the pockets of their shoppers. You are flattered as a shopper. You are in the in-crowd. It's this ego trigger."

Should such a well-heeled chain move into the area, design nuance would play a strong role as the Patch competes for customers.

The trick for Powers-Shamon and Packman, who recognize aesthetics as a vital aspect of renovation plans, is slicing up their budget in a way that devotes the right amount of resources to various project components. Building out new space starts at $100 per square foot, Jacobowitz says. Add in details such as specialized lighting, and that figure rises quickly.

After viewing the Patch's store-design plans, Jacobowitz suggests adding excitement to what he says is a traditional layout. "Everything is on a right angle," he says. "I would open it up more, add angles, boomerangs, create circular flows and areas of interest around their departments.

"It's about not leaving money on the table when you could get a bigger share of the shopping basket with a few thoughtful touches," he adds.

Clark notes, however, that the overall layout of departments is smart. The supplements section, one of the highest dollar generators for natural products retailers, is up front so customers won't miss it. "Vitamins are the first and last thing you see as you approach the checkout," Clark says.

The Patch's restaurant area will be in the back, so the person meeting a friend for coffee and a scone passes by thousands of products to get there, he says. And frozen food cases are, logically, on the last segment of the perimeter, as customers round their way to check-out.

The value of nitty gritty
Clark honed in on the Patch's supplements and bulk foods departments, consistent with his specialty.

"Supplements is one of the areas in any store that generates your highest profitability," he says. And naturals retailers are seeing more "crossover customers who have higher expectations of merchandising because they're used to shopping in a conventional supermarket or drugstore." His initial suggestions for the Patch are based on the current setup. (Several challenges are a result of space constraints the expanded store won't have):

  • Decide whether to set up supplements by brand or by structure/function set—all vitamin C together, for instance. Grouping by brand (what Clark typically advises) offers greater visual draw and the opportunity to build brand loyalty. When products are grouped by structure/function, the way the Patch has traditionally set its shelves, shoppers can better compare brands but the variety and inconsistency of colors and labels can be overwhelming, especially with single-product facing. In that setup, Clark recommends a retailer dedicate a staff person to the section, as the Patch does, to help shoppers. "Without help, they'll pick the prettiest product or the cheapest product," he says.

  • Place shelves closer together, using the "two-finger" rule between the shelf and the bottles below it, Clark says. "Tighter spacing makes the shelves appear full and abundant."

  • Add facings—double, triple and more. This is already a high priority for the Patch, which now can only provide a single facing on many products for lack of space, says Powers-Shamon. More facings makes shopping easier. "Four facings of a product yield 34 percent more attention than two facings," Clark says, citing both his own experience and research he's previously read. And more facings also mean less stocking, Powers-Shamon notes.

  • Put popular products at eye level, to increase visibility and, therefore, the amount of time a customer will spend looking at a product.

  • Rotate end caps with seasonal themes like "cold and flu," or "back to school," which can help get kids' supplements like fish oil off the shelf and in front of a different shopper. The change also keeps the store fresh.

  • Close gaps by placing "out of stock" tags over the price tag on the shelf, then move products from the right or left to temporarily fill the void. The tags also make ordering and restocking easier.

Clark also recommends building wider aisles in areas where shoppers accumulate, a strategy the Patch plans to implement in its bulk-food area.

As with supplements, Clark has a bag of merchan?dising tricks to put more bulk foods on the retail floor and make shopping and stocking easier. The Patch's plans call for a combination of scoop bins, gravity-feed bins and prepackaged foods, he says.

Clark suggests using scoop and gravity-feed bins for the most popular items, so products are fresh. The bins are attractive, but some shoppers don't like them because of hygiene concerns, Clark says. Staffers don't like the maintenance—bins are prone to messes, and the scoops get mixed up or disappear. Clark recommends prepackaging the more perishable and delicate items. The drawback is the time involved to heat and seal bags in a back room.

Clark also recommends more consistent signage throughout the store. Powers-Shamon says she's making those changes, with help from marketing consultant and graphic designer Swoboda. The Patch now has signs of various sizes and colors (pink, green, yellow). The result is a cluttered look. Shoppers have to work too hard to get information, increasing the risk they will tune out the information altogether.

Swoboda's sign strategy starts with consistency:

  • Educational signs should all be the same color, sale signs another color, directional signs another.

  • Typefaces should be consistent not only from sign to sign, but throughout the store's marketing materials, name tags, letterhead and other messaging.

  • Limit wording on signs. "You have five seconds to grab the customer's attention," Swoboda says.

Perhaps most important in maintaining consistency is making sure staff is communicating a consistent message to shoppers. For instance, if products on a particular end cap are marked down, signs should clearly indicate what the product does, why it's effective and so on, Swoboda says. She plans to train the Patch's employees on consistent messaging.

Down the road, Swoboda plans to work with Powers-Shamon and the store's marketing manager on a brand campaign. "They have a really unique logo, but they want to update it and bring some new colors into the store," she says.

Overall, the store has a great opportunity with its expansion, Swoboda says, noting its spectacular success in spite of its small space and outdated design.

"It's grown over the years and stayed independent," she says. "The Patch is kind of like an icon in the industry."

Kelly Pate Dwyer is a Denver-based freelance writer.

Natural Foods Merchandiser volume XXIX/number 3/p. 66,68

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