David Stewart was recently appointed General Manager Merchandise, Foodstuffs North Island Limited. He talked to FMCG Business Head of Content, Tamara Rubanowski, about his new role, developments at Foodstuffs, and challenges for the FMCG industry.
Please tell us about your new role at Foodstuffs NI Ltd.
Put simply, my role is to ensure the products our customers want are on the shelf when they want it. That means sourcing quality products from local and offshore suppliers, making informed product ranging decisions, and making recommendations as to how products are priced and shelved in-store.
In a sense I am the chief “customer advocate” within our wider business, which as well as crunching numbers also means putting yourself in the mind of the shopper and spotting consumer trends while they’re still emerging. If we get that right, and we are able to deliver a satisfying shopping experience, then we not only give our customers a reason to come back (for more of what they want) but give them more time to spend on the fun stuff, like spending time with family and friends.
It also falls on me to convey these messages to the supplier community, for example by working with them to identify gaps in their range and effectively promote their products. Uppermost in my mind is that we are only as good as the suppliers who support us.
To help me achieve all that, I’m currently building on the groundwork laid by Baden Ngan Kee, which means maintaining a world-class merchandising team and continuing to build strategic partnerships with key suppliers. Other short-term objectives include simplifying the way we do business, championing collaboration across our business, and challenging ourselves and our suppliers to give shoppers the best value.
How many stores are under the Foodstuffs banner now?
There are currently 350 stores across our banners throughout the North Island, comprising:
- 42 PAK’nSAVE
- 98 New World
- 7 Gilmours
- 199 Four Square
- 3 Write Price
- 1 Shoprite
What are the big consumer trends in merchandise in New Zealand?
Consumer trends typically reflect wider societal developments, and right now the ever-increasing technological ‘connectedness’ of Kiwis is having a big impact on their shopping habits. For example, they expect to be able to buy anything online, and get round the clock customer service. Some even expect companies to know who they are and use their data to provide a personalised experience.
At the same time, more shoppers are looking for foods with high health values and proven remedial qualities, so we are seeing ‘super foods’ continuing to increase in popularity. That’s having a positive impact on sales of fruit and vegetables, and even influencing store layouts. It also means suppliers are having to rethink and reformulate their ranges, and that there’s a growing expectation on retailers and suppliers to offer health-focussed support, both in-store and online.
A third trend of note is the rise of ‘table for one’ shoppers, including middle aged singles with high disposable incomes, retiring Baby Boomers whose kids have flown the nest, and even people living within families or flats but choosing to eat different meals at different times of the day. This means smaller quantities bought per shop, and greater demand for specialised and/or luxury products.
Can you share some of Foodstuffs’ plans for the next year?
My team are continuing to work hard every day to ensure our customers are getting more out of our stores, and therefore more out of life – by getting the best value for money, the right mix of products, and constant innovations – not just the status quo.
Currently, we’re working on delivering a smart and streamlined New World online shopping service, which we’re piloting this year and deploying next year; and rolling out New World’s Club Card loyalty scheme, which is already available in the South Island and going nationwide later this year.
Internally, we’re currently landing our new Commercial Operating Model, which will make the cooperative much more efficient and bring much simpler trading, greater supply chain efficiencies, and better market clarity. The One Data project is being rolled out now too, and will transform Foodstuffs’ product information management processes by creating a single system and shared team responsible for the companies’ national product information management.
How competitive are NZ supermarkets?
This is a highly competitive sector with strong competition – we are constantly adapting and innovating in order to meet new challenges from services such as My Food Bag to niche retailers like Farro and Nosh.
We welcome competition though, it’s great for our customers and keeps us on our toes, making us constantly focus on our customers’ needs and innovate more creatively.
What are the biggest challenges for the FMCG industry in New Zealand?
One of the challenges for the FMCG industry is ensuring new product innovations get across the line. Creating genuine innovation is often difficult at the best of times and overlaying that Kiwis have distinct taste preferences that have developed over decades, our diverse cultural makeup and our small population makes innovating even more difficult. Unless there’s uptake by a significant proportion of the population it is challenging to make the innovation work for all parties. Because of that there’s a tendency to see innovation in the form of taking something we know is already popular with Kiwis and trying to add further value. When it’s done well the results can be great, a case in point: Lewis Road Creamery took something they knew Kiwis love – chocolate milk – and reformulated and repackaged it, with huge success.
Another challenge, which is by no means limited to the FMCG industry, is the challenge of attracting and retaining great people for the job. For us that means from the shop floor all the way up to the boardroom table, and as New Zealand’s biggest employer, Foodstuffs is constantly looking for ways to ensure we get the best and brightest staff coming through the ranks.
Part of solving this challenge sits with the industry (retailers included), to look for solutions to ensure we get the best people from the start, which in turn, fosters loyalty and long-term staff retention. At Foodstuffs, we have long-standing and very successful butchery and bakery apprenticeship programmes, run in collaboration with the respective industry organisations that help us identify talent and train our teams. And in June, we kicked off our graduate recruitment programme, giving seven top graduates the opportunity to work in various parts of the cooperative for two years. That followed our recruitment drive at the FGC’s inaugural jobs expo at Auckland University, ‘FMCG Futures – For Fast-Moving Careers’.
Do you have any other news to share?
Just that I am very excited about the opportunity to continue with the great work that Baden Ngan Kee and the team have embarked on, and doing everything I can to deliver on our purpose.