Playing at home pays handsomely for Bells Stores, says Rod Addy

Bells Stores is doing a roaring trade in its north of England heartland and over the past 12 months has added £4.5m to its £51.9m sales of a year ago. This healthy £56.4m represents average sales of £23,500 per shop, per week for the independent retailer, which is number 14 in The Grocer Top 50 league.

This success can, in large part, be put down to the tight geographical focus of its estate. While some independents straddle a large area of the UK, Bells Stores has stayed close to its roots, with headquarters in Skelton, Yorkshire.

The initial two stores opened in 1968 and now there are 54 outlets, stretching from the river Tyne to the river Tees, along the A1/A19 corridor. Joint MD Steven Bell says the company is aiming for a total of 70 stores by 2006, and plans are well advanced for three of those, which should open next year.

Chairman of the business is his father Les who also founded the chain of stores where Steven and his brother Peter worked as schoolboys. Peter now runs eight franchise stores. “Almost all our stores are within one hour’s drive of each other,” says Steven, “and
four of them are just five miles apart.”

Harris International Marketing’s 2003 Convenience Tracking Programme estimates that Bells’ customers shop at the stores more times each week than customers at any other multiple convenience store in the programme and they have the highest basket spend.

“A total of 67% of our customers are within 440 yards of a store, against an average for independent retailers of 59%. The area is locked tight,” he says. The company’s territorial strength helps to keep rivals at bay and distribution costs down. “One truck can deliver to 12 stores a day.”

With such a strong tie to the region and a family heritage, it is no surprise that the retailer’s investment in its staff is seen as one of its core strengths. In Bell’s words, he and Peter worked behind the tills “as soon as they could walk”, and therefore have first hand knowledge of the needs of their 1,000 employees. As a result they invest heavily in staff development, financing a wide range of training programmes. “Staff are encouraged to gain external, portable and transferrable qualifications,” says Bell. The company also has its own internal awards scheme to spur on staff motivation and training arm, Bells Training Services, became the first UK company to win grade one status for retail training from the Adult Learning Inspectorate in September. Bells Stores has also gained recognition as an Investor in People.

Another acknowledged winner is its customer offer. “We generate 4.5 million visits a year from customers and when they’re in store, they’re certainly spending,” says Bell.

Services include cash machines, most located inside, mobile phone e-top ups and top-up cards, PayPoint services and the national lottery. The chain’s record on lottery sales is sterling, says Bell. Lottery sales increased by 12.8% from January to June. This is an impressive achievement when so many independents are struggling with lottery sales. Bell says the success is largely through the appointment of a dedicated head of lottery services, Steve Brown. Bells’ Broughton Avenue store in Middlesbrough won the title of National Lottery Retailer of the Year, sponsored by Camelot in September.

To support a customer offer that it believes is second to none, Bells has gained a reputation for using some of the leading edge technology available, under the leadership of IT director Richard Keelyside. By April, the company aims to have finished rolling out software designed to improve stock management by centralising control at head office. Voiteq, a voice-activated warehouse and buying system based on the Vocollect system,used by Wal-Mart in the US, was introduced in 2001. It now connects Bells’ four warehouses - where Piccolink hand-held scanners are used - with HQ.

Joint MD David Graham says: “We’ve saved 18% to 22% in warehouse costs in the 18 months we’ve used the system. It has improved productivity and accuracy of orders and helps to combat theft by improving our ability to track products.”

This use of the latest technology combined with the strong regional heritage should ensure Bells Stores remains at the forefront of the independent sector.