International news analysis: Spar concept uses cafe concessions for growth

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Spar’s latest concept store in Dublin uses a combination of fresh food offers and third-party food concessions to increase sales.

Over the past decade, Ireland has become a hot spot for convenience store innovation. Its population of 4.8 million (1.8 million in the Greater Dublin area), and the presence of leading convenience store operators, including domestic players BWG and Musgrave, as well as UK players Tesco and Marks & Spencer, has created a highly competitive small-store arena.

Regarded as leading innovation in the sector is BWG, Ireland’s third-largest grocer and operator of leading convenience brands, including Spar and Mace.

BWG’s latest 2,690 sq ft Spar concept store is located at Dublin’s Millennium Walkway. It was originally opened in 2005 as a new concept and subsequently re-launched in October 2014 in collaboration with the store’s independent owner, BWG, and Spar International.

The core objective of the revamp was to improve the foodservice offering to entice large numbers of office workers during the day and those seeking meals in the evening. Central to this was bringing in Irish coffee brand Insomnia, with which BWG has formed an exclusive agreement. The expanded coffee area, positioned by a seating area at the front of the store, provides a full barista-style offering and is seen as a key differentiator.

The left-hand side of the store is taken up with further food concession counters – the largest being the Tasty Deli brand, which BWG developed exclusively. The offer changes throughout the day in keeping with breakfast, lunch and evening meals, with digital menu boards updating automatically. Ready-made branded sandwiches and salads are located at a nearby self-service area.

Towards the back of the store is a Subway concession. There is some overlap between the Subway proposition and Tasty Deli’s, although BWG retail development director Declan Ralph explained they typically cater for different customer sets and Subway is a strong brand to entice shoppers.

The entire fresh food offer has at least doubled since the refit, with fresh produce and in-store-baked bread brought to the front. Customers entering the outlet have a strong coffee and fresh food offering in sight.

Ralph emphasised the success of the refit was down to collaboration between independent owner John O’Neill, who provided local expertise; BWG, which provided shopper and competitor research, and Spar International, which offered best practice from other markets globally.

Sales have increased 21% since the refurbishment, with existing customers buying more and new visitors attracted in by the coffee and deli offers. A hundred Spar stores across Ireland will be converted to the new concept over the next two years.