Spotlight On General Merchandise

Within the grocery channel, general merchandise has become a catch-all term for items — usually non-food products — that typically don't fit into any other store department or major category. Such items range from batteries and pest-control products to novelties and cookware — a diverse assortment of goods. And store brands' presence within the mix varies tremendously from retailer to retailer.

Placement and promotional efforts for store brand general merchandise products also vary greatly from banner to banner. To get an idea of what a few retailers are doing here, we toured the general merchandise areas of three grocery stores: a Family Fresh Market store (owned by Nash Finch) in New Richmond, Wis.; a Rainbow Foods store (owned by Roundy's) in Bloomington, Minn., and a Piggly Wiggly store (affiliated with Piggly Wiggly Midwest) in Grayslake, Ill. The visits took place in late September and early October.

Family Fresh Market

General observations: The store itself is not huge, but it has an open feel. The store's general merchandise is located in several different aisles. Every area was neat and well-stocked. Our visit took place in the early evening on a Saturday. We observed a steady stream of traffic in the store.

The upside:

• The store offers almost as many SKUs of its Our Family brand charcoal as it did of the Kingsford brand. The Our Family brand items (both regular and instant light versions) has shelf tags touting "LOW Price."
• The store has many SKUs of Our Family light bulbs — and some of these items had shelf talkers with Our Family "Compare & Save" notations and "LOW Prices."

The downside:

• Store brand general merchandise offerings are rather limited. For example, we found no store brand kitchenware/cookware or school/ office supplies.

Rainbow Foods

General observations: The store seemed to be about the same size as the Family Fresh Market, but had a more cluttered feel (likely because it featured many mid-aisle shipper displays in several areas throughout the store). General merchandise is located in several different aisles and on end-caps.

Our visit took place in late morning on a Sunday. The store was generally neat and well-stocked and enjoyed a steady stream of traffic during our visit.

The upside:

• One size of Kingsford charcoal (16.6-pound) was on promotion, but the price of the retailer's Roundy's brand equivalents still was almost $1.00 lower. The store also gives more facings to its own-brand charcoals than to Kingsford offerings within the aisle and included only its own-brand charcoal in a seasonal display located near the exit door.
• The store offers five SKUs of Roundy's incense sticks — a rather non-typical subcategory in which to compete — and merchandises them prominently above an assortment of candles.

The downside:

• The store merchandises its batteries, flashlights and such on an end cap that extends to the sides of two aisles. Although store brand items could be found here, they kind of got lost the sea of Energizer, Duracell and Rayovac brands.
• Like the other stores we visited, the Rainbow Foods location boasts store brand offerings in only a few general merchandise subcategories.

Piggly Wiggly

General observations: The Piggly Wiggly store was the smallest of the three stores we visited. Although food items were well-stocked and merchandised neatly, much of the general merchandise, located in several aisles, was out of stock or in disarray. We later found out that the store was scheduled to close approximately a month following our visit as the result of a lease dispute, so it could be that non-food items were not being restocked.

Our visit took place mid-morning on a Thursday in early October. Traffic in the store was light.

The upside:

• Unlike the other two stores, the Piggly Wiggly store offers some store brand office and school supplies — under Academix, a Topco Associates brand.
• The store merchandises more SKUs of its own Electrix light bulbs than it does of Sylvania, the national brand it carries.
• Although Duracell batteries were on promotion, the retailer's Electrix battery equivalents still beat their price.

The downside:

• Like the other two stores we visited, the Piggly Wiggly location offers store brand products in only a few general merchandise subcategories.
• A number of products in the general merchandise areas were out of stock, in disarray or missing signage.

No one-size-fits-all approach

When it comes to placement and promotion of store brand general merchandising products, retailers need to match the strategy to the product subcategory. We asked supplier experts for some merchandising and promotion advice specific to a few key general merchandise categories.

Charcoal

On the charcoal side, seasonal displays and ads that also tie in related store brand items such as lighter fluid, wood chips and picnic items go a long way to boost sales, says Dale Elberg, executive vice president with Roswell, Ga.-based Royal Oak Enterprises LLC.

Packaging also is an important merchandising tool here.

"The latest development in store brands has been the Royal Oak Ridged product improvement," Elberg says, "and for the most part, store brand packaging is conveying the faster-starting, better-burning, ready-to-cook-on-in-15-minutes message to the consumer.

And Elberg advises retailers to protect their own-brand charcoal when the national brand is on promotion during key holidays associated with grilling. Even though a promotion might last only a week, it could take many consumers out of the market for much of the grilling season.

Pest control products

Protecting the store brand by reducing pricing during a national brand promotion is just as important on the pest control side to drive the value message, says Kathleen Oliver, regional sales manager for the Midwest at PIC Corp./Pic Pest Free Living, Linden, N.J.

"There also needs to be clarity at the shelf label," she says. "The product and the product message need to be clear and given the same attention that the national brands give to their items. If the product needs a shelf tray in order to stand upright and create interest and eye appeal, it should be part of the thought process."

Off-shelf promotions, too, are critical in the pest control arena, Oliver says, noting that Supervalu banners use gravity feeds, floor displays and clips strips for private label insecticide items — and see sales lifts of more than 200 percent."

"If the national brand is being given additional promotional opportunities, your private label needs the same exposure, especially during the season," she adds.

Here, store brand packaging will help attract consumers by having the "feel" of the national brand equivalent, Oliver says.

"The product copy, clarity of instructions and packaging shape and size need to be familiar [so] the customer [will] say, 'Why don't I give this a try,'" she says.

Batteries and flashlights

For items such as batteries and flashlights, retailers will want to reconsider space allocation, suggests John Yannuzzi, vice president, corporate brands for PowerMax Battery USA, Rancho Cucamonga, Calif.

"The brands, on average, are assigned over 80 percent of the selling space even though the store brands offer a lower investment cost, lower retail, higher penny profit and best overall value to the consumer," he says. "Less space exposure communicates to the consumer that the retailer does not [have] confidence in their quality versus the national brands'."

The segment's size calls for a two-to three-brand strategy, Yannuzzi believes, where the store brand is merchandised in the middle of the section and not in a wing location. He also believes retailers should make it easier for consumers to perform a price comparison.

"Impulse categories such as batteries need focus drawn to [them] through temporary price reductions, advertising and displays throughout the year," he adds.

Lighters

Another impulse category lighters — presents a high-volume, high-profit opportunity for retailers, contends Sonia Acosta, marketing manager for Ontario, Calif.-based Calico Brands Inc.

"Creating a permanent home for lighters and keeping it stocked will create optimum sales and profits results," she says.

Retailers would benefit from developing a complete line of lighters for different uses, Acosta notes. Possibilities include sparkwheel pocket lighters, electronic pocket lighters, standard utility lighters, candle lighters and more. Here, a cohesive look across the store brand line creates a strong impact on the consumer, she adds.

"As for merchandising vehicles, there has been growth in shelf-ready packaging because they offer efficiencies in stocking," she says. "Shelf-ready packaging can effectively serve as a display, help drive visibility and brand messaging, and facilitate shopability."

However, retailers would be best not to overdo it here — keep it simple and easy to shop, she says.

Cross-merchandising lighters with items such as candles, party supplies, fireplace items, charcoal and other products that require use of a lighter also goes a long way to tempt shoppers to a purchase. Acosta notes that Calico offers a number of merchandising vehicles — including floor displays, clip strips, counter displays, power wings and four-tier racks — to help retailers here in areas throughout the store.

One last word of advice

Finally, across all general merchandise categories, retailers need to be thoughtful when it comes to ad placement tied to new store brand items, says Richard Elden, owner of dbest Products Inc., Hermosa Beach, Calif.

"Ordering a large quantity for an ad and then not running [the product in the ad] kills a hot product," he says. "Failing to rectify this problem by not running it in the next ad opportunity creates an overstock disaster when it could have been a strong sell-through instead."