Amberly is a town located about 50 kilometres north of Christchurch. With a population of just under 1800, 30 percent of whom are senior citizens, it’s not an obvious fit for leading-edge retail technology, but that’s exactly what it got when Foodstuffs South Island opened its first Pams Pantry store there in early July.
The store was originally a Four Square, but when the former owner decided to exit the business, the Foodstuffs-owned building was reborn as Pams Pantry.
Pams Pantry is radically different from other Foodstuffs offerings from the Four Square, New World, Pak’n Save and Fresh Collective brands – it stocks only 2500 products, mostly from the Pams, Pams Finest and Value range, and is fully self-service.
It’s intended as a concept store catering to the key drivers of ease, convenience and great value.
Tim Donaldson, general manager retail for Foodstuffs South Island, says the self-checkout aspect will free up the seven staff members to offer an increased level of customer service – and indulge in a time-honoured small town tradition.
“There will still be an opportunity to catch up on local gossip and news with our people, but those customers who love the ability to get in and out quickly with no fuss, will enjoy the ease of self-checkout.”
Following the store’s launch on July 10, Donaldson says it was enthusiastically received by Amberly locals.
“A couple of comments really brought home how we’ve nailed the proposition. Firstly, we’ve curated the range very carefully, ensuring we’re stocking essentials and super fresh every day produce and meat. The first customers through the door said they loved that approach – it made their shop very simple, fuss-free and convenient. So, it’s easy to find what you want and get out the door.
“But they also talked about the outstanding service they received from the team – who are freed up from operating a till, to help customers with product queries and ideas for their breakfast, lunch or evening meal.”
Donaldson says the Amberly Pams Pantry store is a pilot that was in development for months: “In the thought process, it’s been probably 10 years.”
If the operational model is successful, Foodstuffs South Island will consider where to roll out the Pams Pantry concept out next. Donaldson says it’s been “quite an adventure” creating an entirely new format.
“We’ve been thinking about this for some time, and it was just timing,” he says. “It’s about discovering the business model that works – [with some aspects we] might need to tweak and play and discover what works.”
To switch it over from the Four Square format, the team put in new racking, painted, installed LED lights, removed tiles and polished the concrete floor. Donaldson says Foodstuffs hasn’t invested heavily into the fit-out as Pams Pantry Amberly is a pilot – the goal is to get the operational model as efficient as possible.
The 100 percent self-checkout store has the same number of staff as it would do if the staff were performing regular check-out duties, says Donaldson. They’ll be available to assist or scan items themselves if customers aren’t able to do so, but freeing them from check-out duties means they’re able to offer a more hands-on service.
“It’s just around making it a different experience,” Donaldson says.
He believes customers are used to self-checkout by now, anyway. The first self-checkout system in New Zealand was introduced by Foodstuffs at Moorehouse Avenue Pak’n Save in Christchurch in 2007.
Donaldson says formats like Pams Pantry are often designed and modelled around an urban convenience environment, but regional communities like Amberly always like an opportunity for growth.
This kind of innovation in the regions is not entirely unprecedented, either – in early 2016, a Swedish entrepreneur called Robert Ilijason unveiled an unmanned 24-hour convenience store to his 4,227-person village.
“My ambition is to spread this idea to other villages and small towns,” Ilijason told the World Associated Press. “It is incredible that no one has thought of his before.”
Amberly is rural but has quite a large catchment, Donaldson says. He describes the Pams Pantry opportunity as a “high-convenience, daily top-up environment.”
“We think the timing is absolutely right for this format.”
Customer behaviour has been changing fast over the last few years towards higher frequency of shop, smaller baskets, and a tendency to shop for ‘tonight’s meal’ rather than bulk. At the same time, customers are increasingly value-seeking. Fresh food is a key component of these top-up shopping trends.
Donaldson also cites the popularity of the everyday low price (EDLP) format across Lidl and Aldi overseas, which succeed with a tighter range and consistent pricing.
“With predominantly Foodstuffs private label, [we can provide] very good everyday value and high quality… with an exceptional fresh and meat offering.”
The gaps in the Pams, Pams Finest and Value rangewill be filled by a limited number of branded products such as Whittaker’s, Corona and Meadowfresh Kalo yoghurt.
Store operator Robin Brown says the locals were asking every day when the store would open.
“So we’re delighted we’re finally underway and able to help Amberley residents and visitors to the area, save time, hassle and money with their shopping at Pams Pantry.”
This story originally appeared in NZ Retail issue 763 August / September 2019.