Innovative Retailer – Community Shop

The Name: Community Shop backed by parent company Company Shop.

The Place: Two locations currently, Barnsley up north and Gypsy Hill in South London. But you have to be a deprived area to get one so be careful what you wish for.

The Story: Actually I’m sure it would be very nice to have a shop where one can buy Waitrose products at knockdown prices but it’s not for the prosperous middle classes is it?

I don’t know. You’ve explained nothing yet: Alright, imagine this scenario – you order your online shopping delivery and then for whatever reason you are not there to receive it at the scheduled time. You’re okay as you just get another delivery but what happens to the stuff?

It goes back to the distribution depot: Wrong, it effectively gets dumped. Whatever it is, cans, detergent, bottles of things that could not possibly have deteriorated in any way during the journey. All chucked.

Well, I’ve got my sad face on here: Quite. Now consider this. A vast amount of biscuits and such has just been recalled by the supermarkets because a nut allergen was not labelled correctly on the wrapper. The overwhelming majority of us can eat that product, no problem, but it cannot be sold on the public market. What do you think happens to that mountain of consumables?

I don’t know but I have a bad feeling: It’s just tipped into the rubbish bin. And this trust me is just the tiny tip of the food surplus iceberg suggests Sarah Dunwell, a director of Company Shop. It’s absolutely nothing to do with Sell By dates. No one is allowed to sell food that has gone past its Sell By dates. You can’t even give it away. It’s all to do with mistakes with packaging, damaged wrappers, over ordering, wrong labelling and catching some of the incredible waste between depot, manufacturer and retailer. As much as 50% of the goods on the shelves are short shelf life (Best Before dates) and the other half are of the wrongly labelled, mis-packaged variety mentioned before.

So now I have my happy face on again: Good. Because this is a win-win story. Dunwell says Company Shop mentioned above has been working in the UK for 35 years operating staff shops in large manufacturers. If you work at a biscuit factory you will be able to buy packs of those very biscuits you make at a reduced price if they are broken, or the packaging went on wrongly, or they were a bit over-baked etc etc…

So manufacturers don’t mind if this 80% perfect stuff gets sold to their own staff? Correct. That is the key to the whole concept. Controlled-access. No manufacturer worth their salt is going to be willing to let a general market develop in their carefully built up brand where the goods are sold at a substantial discount. Company Shop has now taken this controlled access staff concept and brought it to the public domain because everyone buying from the Community Shop in Barnsley is on means-tested benefits. These Members can be working too but perhaps in receipt of working tax credits for example and politicians are falling over themselves to welcome these not-for-profit shops. In Gypsy Hill Community Shop for example pays just a peppercorn rent – although the company of course has to foot the renovation costs (£1 million in that case).

What’s the actual working mechanism? Community Shop buys the surplus from manufacturers (with the agreement of retailers and distributors) and sells it at up to 60% discount.

So simple: But after that is actually where the problems/innovations begin. Not to put too fine a point on it… if you are on severely limited budget and live off basic fish fingers, then walking into a shop which might be offering you all manner of upmarket and exotic goods is going to be a problem. Company Shop will have achieved precisely nothing if the products are then taken home and thrown into the bin because the purchaser does not know how to cook it, and with what to cook it etc.

Good point: Also, the contents of the shop are constantly changing, what is on offer one day probably won’t be on offer the next. Don’t bother going in with a shopping list. So customers also have to be confident in throwing together whatever is there to create their evening meal – no one is saying they cannot or do not want to do that, but they almost certainly will need to be taught how to do it.

And the answer is? I give you The Hub. Dunwell says these shops are not for profit because any money made goes straight back into the cafe/education concept where the underlying food/poverty problems are looked at with the individuals. The Hub works closely in conjunction with the shop as it uses the short shelf produce – that needs to be used – in its café serving hot food every day.

Wow, so the café chef is on some kind of mad MasterChef challenge every day: Yup. Members have mentors and the chef also shows customers how to cook.

What’s the future for these shops? Now that there are two stores happily motoring along the roll-out plan is to have 20 around the country. Asda has been particularly helpful to the company and some of the ex-Netto stores, which were mothballed after Asda’s purchase of the company, being used for Community Shops. The stipulations are that they open near areas of deprivation, and within distance of either growers’, manufacturers or distributor networks.

And logistically speaking? Of course, everyone needs to be signed up to this. All the major supermarkets are, and apparently there are “warm” discussions going on with Aldi and Lidl at the moment. Community Shop has some trucks of its own picking stuff up and the company also piggy backs off the distributors’ own delivery fleets. However, there might also be scope to develop a click & collect concept in community centres as this already exists in the Company Shop side of things.

Well, hats off all round I think: It’s hard to object to it isn’t it? Surprisingly though, the card memberships on average lasts only 6-9 months. After that people are “proud” to hand it back and move on having begun to resolve the issues that initially brought them there but having learned how to throw together a quick linguine alla pomodoro on the way.

Umm: Pasta with tomato sauce to you.

I knew that.

PCMS Group is a leading independent supplier of software and services to the retail industry; PCMS Store and Multi-channel solutions have been chosen by over 98 retailers including Arcadia, John Lewis and M&S.