Costcutter and Bargain Booze dual-branded store increases sales by 48%

Bestway Retail, which introduced its ‘store within a store’ model last year, bringing together Costcutter and Bargain Booze, has increased sales in its Bolton dual-branded store by 48% since its relaunch in March this year.

Customer footfall has increased by 40%, chilled sales have doubled, and profitability has increased by 3% margin points, driven by a new hot food-to-go offer.

As a result, the store anticipates recouping the initial £250,000 investment within two-and-a-half years.

The Bargain Booze section of the store now boasts over 750 SKUs of beers, wines and spirits – up from 500 SKUs – and includes a new range of ales and a low/no alcohol section. This has led to a 24% increase in alcohol sales, which now average £7,000 per week.

Shop owner Kersheaup Vagadia says: “The hybrid implementation of the new Bargain Booze concept in store has yielded remarkable results for our store. With two prominent brands displayed above our door, we’ve witnessed a significant increase in footfall, gaining not only substantial numbers of customers but also an average basket spend increase of £2.20 per customer.”

Before the relaunch, the store conducted extensive research and analysis, working closely with the store development, retail and commercial teams at Bestway Retail to identify areas of strength and weaknesses. This involved breaking down sales by category and examining the shopping habits and preferences of customers. This process highlighted that the store had only tapped into a small portion of its local customer base, presenting the store with tremendous opportunity, Bestway reports.

“We leveraged this valuable insight to design our ideal store, ensuring that each identified shopper need was addressed,” said Vagadia. “Planning encompassed the inclusion of a dedicated fresh bakery, a well-curated hot food section, a convenient drinks-to-go area, a wide range of fresh produce and chilled products, and an expanded product selection throughout the store to exceed our competitors’ offers. It has really opened our eyes to what our customers want and given us a new perspective of how to run our business.”

The hot food section has emerged as the most profitable department in the store, consistently achieving an average margin of 38%. This success is reflected in weekly sales of £1,300 – up from £150.

The expansion of Co-op own-brand products has also led to increased sales. In particular, the chilled and fresh produce sales have tripled, with fresh meat and ready meals showing a 270% increase.

Despite the store’s unchanged square footage, the product range has been expanded by 18%, and this, coupled with the influx of customers, has brought growth to the store.

Dawood Pervez, managing director at Bestway Wholesale, said: “We are continuously investing in store formats to help our retailers redefine their stores to meet today’s shopper missions. Our dual-branded stores are leading the way and we are delighted to work with such forward-thinking partners – the results are testament to the dedication and commitment of Vagadia.”

Jamie Davison, retail director at Bestway Retail, added: “Vagadia is a shining example of the entrepreneurs that are leading convenience. The results the store has achieved demonstrate our strengths in working closely in partnership with our retailers to deliver formats that drive both growth and profit for the retailer.”

To date, Bestway Retail has completed the relaunch of 10 shops to its Costcutter/Bargain Booze ‘store within a store concept’ and it has a further 20 in the pipeline. Due to the interest received, Bestway Retail is planning to expand the concept  into areas of the UK where Bargain Booze hasn’t historically operated.