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David Mace
Business Consultant
Kansas Small Business Development Center
1. Have a customer mindset
2. Ask the right questions
3. Read between the lines
4. Take appropriate action
Industry trends
Sources of revenue: 50 percent from perishables
Increased localization of chain stores
National consumer trends
Spending habits
Health concerns
Household Spending (2006) for Food: Food at Home Household Spending (2011) for Food: Food at Home
United States United States
Household Average Annual Expenditure Geography Household Average Annual Expenditure Geography
Market Potential Market Potential
Count Expenditure Share Index Count Expenditure Share Index
Total 114,205,880 $378,718,401,041 $3,316.10 7.14% 100 Total 121,343,736 $402,388,262,971 $3,316.10 7.12% 100
Household Average Annual Demographic Demographic Household Average Annual Demographic Demographic
Demographic Category Market Potential Demographic Category Market Potential
Count Expenditure Share Index Count Expenditure Share Index
Age of Householder Age of Householder
Under 25 Years Old 7,807,551 $15,230,254,433 $1,950.71 4.02% 59 Under 25 Years Old 8,298,983 $16,196,884,956 $1,951.67 4.03% 59
25 to 34 Years Old 19,948,199 $64,382,107,509 $3,227.46 17.00% 97 25 to 34 Years Old 20,973,323 $67,724,068,312 $3,229.06 16.83% 97
35 to 44 Years Old 23,488,649 $89,922,555,544 $3,828.34 23.74% 115 35 to 44 Years Old 24,226,101 $92,791,548,377 $3,830.23 23.06% 116
45 to 54 Years Old 23,234,071 $89,233,393,822 $3,840.63 23.56% 116 45 to 54 Years Old 25,078,507 $96,364,722,569 $3,842.52 23.95% 116
55 to 64 Years Old 16,868,506 $57,686,294,993 $3,419.76 15.23% 103 55 to 64 Years Old 18,331,749 $62,721,180,068 $3,421.45 15.59% 103
65 Years and over 22,858,904 $62,263,794,740 $2,723.83 16.44% 82 65 Years and over 24,435,072 $66,589,858,689 $2,725.18 16.55% 82
Race of Householder Race of Householder
White, Non-Hispanic 83,484,655 $276,185,771,025 $3,308.22 72.93% 100 White, Non-Hispanic 87,934,165 $290,667,524,305 $3,305.51 72.24% 100
Black, Non-Hispanic 12,688,504 $35,545,221,481 $2,801.37 9.39% 84 Black, Non-Hispanic 13,511,026 $37,818,418,484 $2,799.08 9.40% 84
Other, Non-Hispanic 7,172,787 $25,594,702,749 $3,568.31 6.76% 108 Other, Non-Hispanic 7,732,495 $27,569,315,987 $3,565.38 6.85% 108
Hispanic 10,859,933 $41,392,705,787 $3,811.51 10.93% 115 Hispanic 12,166,050 $46,333,004,196 $3,808.39 11.51% 115
Household Income Household Income
Less than $15,000 17,626,504 $43,213,331,347 $2,451.61 11.41% 74 Less than $15,000 18,404,997 $45,014,041,192 $2,445.75 11.19% 74
$15,000 - $24,999 14,428,446 $37,803,752,724 $2,620.08 9.98% 79 $15,000 - $24,999 15,170,846 $39,653,892,733 $2,613.82 9.85% 79
$25,000 - $34,999 14,509,283 $41,298,247,068 $2,846.33 10.90% 86 $25,000 - $34,999 15,325,204 $43,516,364,878 $2,839.53 10.81% 86
$35,000 - $49,999 18,864,845 $58,985,628,712 $3,126.75 15.58% 94 $35,000 - $49,999 20,029,116 $62,476,317,818 $3,119.27 15.53% 94
$50,000 - $74,999 22,452,309 $82,650,069,910 $3,681.14 21.82% 111 $50,000 - $74,999 24,005,186 $88,155,205,348 $3,672.34 21.91% 111
$75,000 - $99,999 11,927,482 $48,674,533,091 $4,080.87 12.85% 123 $75,000 - $99,999 12,840,367 $52,274,649,870 $4,071.12 12.99% 123
$100,000 and over 14,397,012 $66,092,838,189 $4,590.73 17.45% 138 $100,000 and over 15,568,019 $71,297,791,134 $4,579.76 17.72% 138
Housing Unit Occupancy Housing Unit Occupancy
Owner Occupied 77,041,269 $282,232,954,049 $3,663.40 74.52% 110 Owner Occupied 83,123,104 $303,493,435,440 $3,651.13 75.42% 110
Renter Occupied 37,164,725 $96,485,446,992 $2,596.16 25.48% 78 Renter Occupied 38,220,770 $98,894,827,531 $2,587.46 24.58% 78
Household Type Household Type
Married Couple, No
Children 32,557,121 $108,440,273,009 $3,330.77 28.63% 100 Married Couple, No Children 34,832,526 $115,736,517,846 $3,322.66 28.76% 100
Married Couple, Children 28,305,639 $131,159,818,816 $4,633.70 34.63% 140 Married Couple, Children 30,470,632 $140,847,824,670 $4,622.41 35.00% 139
Single Parent 28,975,992 $88,785,131,495 $3,064.09 23.44% 92 Single Parent 30,447,951 $93,068,098,442 $3,056.63 23.13% 92
Other Households 24,367,128 $50,333,177,721 $2,065.62 13.29% 62 Other Households 25,592,627 $52,735,822,013 $2,060.59 13.11% 62
Third Wave Research estimates using the Consumer Expenditure Survey (2000/2001) and 2000 Census data Third Wave Research estimates using the Consumer Expenditure Survey (2000/2001) and 2000 Census data
Source: Third Wave Research Source: Third Wave Research
http://www.thirdwaveresearch.c http://www.thirdwaveresearch.co
om/mrttwr m/mrttwr
Kansas Small Business Development Center
Food Marketing Institute
Progressive Grocer magazine
Nationaltrends indicate tendencies
Know your local market
How far do they drive?
Which items are they more likely to buy locally?
What motivates them?
The person with the money is in control
CEX - Food, Beverage & Grocery Detail Comparison Report
1 Miles: 3 Miles: 5 Miles: 10 Miles: 15 Miles: 25 Miles: Kansas Entire US
2009 Consumer Expenditure (Average Household
Annual) Food & Beverages Detail
Total Food & Beverages $7,296.52 $7,303.76 $7,349.22 $7,594.69 $7,271.29 $8,307.47 $7,767.37 $8,216.86
2009 Food & Beverages
Alcoholic Beverages $536.87 $537.53 $541.70 $565.85 $543.46 $639.46 $597.57 $641.82
Food At Home $3,840.03 $3,843.28 $3,863.26 $3,968.06 $3,823.80 $4,282.25 $4,029.26 $4,234.91
Food Away From Home $2,919.62 $2,922.94 $2,944.26 $3,060.78 $2,904.03 $3,385.76 $3,140.54 $3,340.14
2009 Food & Beverages: Away From Home
Board (Including At School) $48.45 $48.50 $48.83 $50.69 $48.67 $56.39 $52.74 $56.45
Breakfast And Brunch $178.37 $178.57 $179.86 $186.90 $177.51 $206.82 $191.95 $204.18
Catered Affairs $69.99 $70.07 $70.62 $73.65 $69.42 $81.26 $75.15 $79.82
Dinner $1,175.43 $1,176.79 $1,185.53 $1,233.58 $1,168.04 $1,363.43 $1,263.14 $1,342.08
Food on Out-Of-Town Trips $467.68 $468.22 $471.69 $490.62 $464.18 $541.95 $501.74 $533.49
Lunch $781.92 $782.79 $788.33 $818.34 $779.14 $906.42 $842.45 $896.92
Snacks And Non-Alcoholic Beverages $197.78 $198.00 $199.39 $207.00 $197.08 $229.48 $213.37 $227.19
2009 Food & Beverages: Bakery Products
Bread And Cracker Products $5.37 $5.37 $5.40 $5.55 $5.34 $5.98 $5.62 $5.91
Bread Other Than White $54.18 $54.23 $54.51 $55.97 $53.87 $60.32 $56.68 $59.54
Cakes And Cupcakes $38.29 $38.32 $38.52 $39.52 $38.08 $42.62 $40.10 $42.19
Cookies $54.25 $54.30 $54.58 $56.03 $53.98 $60.41 $56.80 $59.65
Crackers $28.45 $28.47 $28.62 $29.37 $28.29 $31.67 $29.78 $31.28
Doughnuts, Sweetrolls, Coffeecake $27.64 $27.66 $27.80 $28.49 $27.63 $30.79 $29.06 $30.52
Fresh Biscuits, Rolls, Muffins $51.84 $51.88 $52.16 $53.56 $51.55 $57.72 $54.26 $56.98
Fresh Pies, Tarts, Turnovers $16.57 $16.58 $16.67 $17.12 $16.48 $18.45 $17.34 $18.22
Frozen & Refrig. Bakery Prod. $29.95 $29.98 $30.13 $30.93 $29.80 $33.35 $31.36 $32.94
White Bread $52.13 $52.17 $52.45 $53.81 $51.90 $58.04 $54.62 $57.37
2009 Food & Beverages: Cereal & Products
Cereal $106.34 $106.42 $106.93 $109.46 $105.58 $117.66 $111.03 $116.73
Flour $9.66 $9.67 $9.71 $9.92 $9.62 $10.68 $10.11 $10.65
Pasta Cornmeal Oth Cereal Prods $31.30 $31.32 $31.48 $32.22 $31.08 $34.63 $32.68 $34.35
Prepared Flour Mixes $15.61 $15.62 $15.70 $16.08 $15.48 $17.27 $16.27 $17.09
Rice $19.17 $19.18 $19.27 $19.69 $19.11 $21.22 $20.11 $21.19
2009 Food & Beverages: Dairy
Butter $19.10 $19.12 $19.22 $19.73 $18.99 $21.27 $20.00 $21.02
Cheese $124.55 $124.66 $125.31 $128.56 $124.02 $138.78 $130.70 $137.39
Cream $11.02 $11.03 $11.09 $11.37 $10.98 $12.29 $11.59 $12.21
Fresh Milk $146.27 $146.40 $147.19 $151.11 $145.27 $163.12 $153.37 $161.29
Ice Cream And Related Products $70.04 $70.10 $70.47 $72.33 $69.69 $78.02 $73.42 $77.18
Other Dairy Products $31.60 $31.63 $31.80 $32.63 $31.42 $35.20 $33.12 $34.83
Kansas Small Business Development Center
Focus Group
Have everyone over for a chat
Have it professionally administered
Survey
Survey Monkey or QuestionPro
Circulate survey in local utility bill
Don’t take data at face value
What is the data telling you?
Data should lead to questions
before leading to answers.
What are these people eating for breakfast?
Don’t people in rural areas get busy too?
Kansas Small Business Development Center
Follow up with people in the community
“What did you mean by that?”
“When you said _____ did that mean _____?”
Ask other grocery store owners
How do spending habits jive with other facts?
Income
Other habits
Does the data alter your goals?
Consider all the factors:
Convenience
Budget (in light of alternatives)
Trading Up
Consumers make trade-offs
One man’s bass boat is another man’s grill
Stay home and cook a really good steak
-OR-
Drive into town for an expensive meal?
Trading Up by Michael Silverstein
Primary research
Survey
Focus Group
Demographics don’t tell the whole story
Neither do spending habits
What do people do for fun?
Hobbies
Interests
Favorite TV shows
Are they more likely to read Gourmet?
Do they watch Bravo? Food Network?
Do they garden? Hunt? Fish?
Seasonings
Recipes
Canning supplies
Location
Price
Inventory
Hours
Promotion
Contact KSBDC for assistance from us and
referral to other resources:
David Mace, business consultant
BCC Kansas Small Business Development Center
316.218.6374
dmace@butlercc.edu
