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Slide 1 - Rural Grocery Initiati

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Slide 1 - Rural Grocery Initiati Powered By Docstoc
					                               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

				
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