Marilyn Holt has spent an hour jostling for a decent grid position in the 300-strong queue but there are 50 or so people ahead of her. She’s anxious she will miss out on a £69.99 Bush TV she’s set her heart on. Her eyes dart nervously to the front of the queue as the woman who started it three hours ago at 5.30am cuts the ribbon.
The great Netto trolley dash has begun.
The Danish discounter likes to throw a party on opening day and its new store at Kingsway Retail Park in Rochdale, near Manchester, is no exception. Enticed by heavy advertising in the local press and a raft of promotions, the turnout always surprises observers, grins its UK MD, Claus Waedeled, as one of the first shoppers to leave the store thrusts his new £49.99 dual suspension mountain bike at him to guard while he loads a TV into his car.
Like Netto’s Hoddesdon store, which was relocated from the town centre to an edge-of-town location in May, the Rochdale store benefits from a much better location than some of the old stores.
Situated on a prominent and highly visible retail park with generous car parking, this is smart shopping, as Netto’s top brass like to call it, in a smart environment.
At 10,495 sq ft, Rochdale is 50% bigger than the average Netto store.
This, along with a new automatic store order replenishment system, has enabled it to improve availability, says operations director John Buitekant.
“The old stores were smaller so were running down stock very quickly and we got a poor reputation for availability,” he admits.
Improved lighting, wider aisles, new merchandising stands and clearer signage make the store feel brighter and more inviting.
Everything is designed to be easily accessible. Most of the units are two shelves deep. In the freezer aisle, Buitekant points to use of chest freezers rather than the more economic wall cabinets because “there’s no barrier to purchase and it allows people to pick the product up and feel it”.
Netto has stuck to its tradition of stocking spirits by the cash tills to minimise shrinkage and encouraging one-way traffic by stocking household goods in the first aisle.
“If you put canned there, it slows traffic,” says Buitekant. “Household is also a high profit category.” And brands form a high percentage of the SKUs.
Shoppers are queuing in the aisles to pay, but the checkouts cope with the volume of traffic thanks to extra staff.
A harassed mother who has been eyeing a 12-pack of toilet roll accosts him to ask whether Netto takes cards. Buitekant tells her it does. “That’s made all the difference,” he says, adding that when Netto didn’t accept Switch cards it might not have been a sale.
In the fresh produce section, there are only 50 lines, but they include products like garlic and baby sweetcorn as well as the predictable staples. Visually, the fruit and veg stand up well to the multiples’ offer. But the price points are strikingly different with a two-for-one offer on 59p punnets of strawberries typical.
This sort of pricing is only possible because of the discount model of a brutally minimal range. Netto stocks 1,100 lines. “That’s the ceiling,” says Buitekant. “Above that you start to lose efficiency. A lot of this will be sold in a day or two. Stock turn is very important. Everything is turned through in less than a week.”
As a discounter, an efficient supply chain is critical. But equally important to Netto is getting the message across to consumers that its products are cheap ’n’ smart - not cheap ’n’ nasty - and a smarter look overall is part of Netto’s wider drive to be more customer-friendly. Says Buitekant: “We’ve been poor at telling people what we do and the supermarkets have been clever by bringing out value ranges and emphasising the price comparison - not the quality.”
The opening proves to be the second most successful Netto opening in Europe, attracting 8,000 customers.
Every shopper we speak to, many of whom had never shopped at a Netto before, gives the store a big thumbs up.
Sadly, Marilyn dashes off clutching her TV before we catch up with her. But the verdict of Frank Bradley, who with his wife Carole had just bought a four-man tent for £29.99, is typical. “We were surprised by the big turnout but it’s been good. They’ve got a good location, there’s plenty of parking space. There’s a Morrisons next door but this has better offers. And the quality of the products is good.
“They’ll definitely take some of Morrisons’ business away.”
Consider yourself warned, Sir Ken.