C-Store Candy

Buying Direct

Martin & Bayley warehouses products for all Huck’s locations in Carmi, Ill., and has its own fleet of delivery and fuel trucks. “We had a distribution center back in the ’80s and ’90s, but at that time, we also had supermarkets,” explains Adams, who has been a buyer for Martin & Bayley for more than a decade. “When we got out of the supermarket business, we decided to get out of the distribution side as well. In 2003, we felt our store count was large enough to get back into distribution, and we reopened the warehouse.” Each Huck’s store gets twice-a-week deliveries on all warehouse products.

The decision to warehouse and distribute its own products did create cause for some brand replacements. Brands like Little Debbie and Hostess were replaced with Dolly Madison and Mrs. Freshley’s because the latter don’t require their own company trucks to deliver product. Adams says Huck’s services its own milk and ice, too. “We sell more gallons of milk than most supermarkets,” affirms Adams and adds that Huck’s has become a destination point for milk (Prairie Farms brand), because it’s that aggressively priced.

Who’s Buying What?

Like most c-stores, Huck’s has a heavier male population in its store—approximately a 60:40 split. Adams says his average customer isn’t extremely price-conscious, either. “We use the term ‘insult pricing’ sometimes to make sure we don’t cross a line and prevent sales, but so far I haven’t seen that price point in candy,” says Adams. He’s also discovered that a pure price promotion doesn’t necessarily increase sales in candy. “A sale price on a shipper moves extra product, but reducing the price 10 cents off the shelf doesn’t do a thing except cost gross margin.” Adams has found success in direct-mail promotions. The candy bar coupon is by far the most redeemed coupon in Huck’s flier and is often tied in with the purchase of a fountain drink.

Not surprisingly, the c-store chain’s two best-selling candy items are Snickers regular size bars and Reese’s king size bars, which Adams says hasn’t changed in the past five years. “My wife and I were talking one day and she said she could probably name the top 10 candy bars. Almost in the right order, she rattled them off,” shares Adams a bit incredulously. “It made me realize that despite all the new items introduced every year, and no matter how well they do initially, the old standbys in chocolate keep taking on all challengers and keep winning; something very different than the gum and mint category, where Stride and Five have just taken over the old brands.”

One chocolate item that has taken Adams by surprise is a bar from World’s Finest Chocolate. Adams says the company came to Huck’s with an idea to put the c-store’s charity, Karing for Kids, on a promotional chocolate bar. “We started out conservatively, putting a fifty-count box in each store,” tells Adams. “I had stores that sold out of the box in two days. The next time we increased the order to two to three boxes per store, and the results were the same.” This past spring Huck’s held its annual food show, and one store bought 40 boxes. Adams says the store manager was questioned about the order and she said she could sell all of them within a few weeks. “She told us that she doesn’t ask [customers] to buy a candy bar, she tells them they’re going to—and most of them do,” says Adams.

Other items brought in that have done well for Huck’s include Trophy Nut’s Cotton Candy clip strip, Mars’ M&M’s Coconut, Vande Walle’s wrapped caramels, Ferrara Pan’s Black Forest Gummies peg bags, and Tootsie Roll Industries’ Cry Baby Extra Sour Bubble Gum and Dubble Bubble Gum peg bags. Huck’s private label peg bag line, “Snak Shack,” has also been a popular customer pick. Snak Shak bags sell two for $2 or $1.19 each. Huck’s recently switched its re-bagged candy line to Rucker’s Wholesale and Service Company, which is located in Bridgeport, Ill., not far from Martin & Bayley’s Carmi, Ill., headquarters. “Besides being a great company to work with, it makes it very convenient to be so close,” says Adams of the new partnership.

Items that have tanked at Huck’s are full-size, high-end gourmet chocolate bars. “Our customers are not ready to pay $3.39 for a chocolate bar,” Adams says. He is convinced, however, that gourmet will sell. To that end, he’s bringing in gourmet changemakers and pricing them at three for $1. Items like individually wrapped Lindt Lindor Truffles and Morris National Inc.’s Nutffles are part of Huck’s revised gourmet lineup.

The changemaker category is one in which Adams says he’s seen a “big jump” in sales. His theory is that when Huck’s crossed the dollar price point on candy bars, kids coming in with a $1 from mom had to find something else to buy. “They can get two or three changemakers and have a little leftover.”

Resets

At Huck’s, there are two major candy resets a year—June and December—the months the major candy companies tend to release new items, says Adams. Outside of those months, Adams says he’s always ready to do a “pull and plug” if an item is discontinued or if something really hot hits the market. To keep merchandise and merchandising programs uniform, Huck’s stores candy planograms are identical and all candy products are in full distribution.

When asked what criteria a new product has to meet to get on his shelf, Adams shares, “If it is from one of the big boys with a proven track record of successful launches, we will usually bring it in. If it’s an offbeat item, we might wait to see if it has any success before we take the time to bring it in, change the planogram, and spend labor [time] resetting the sections.”

When it comes to seasonal items, Huck’s doesn’t carry much for the same reason most c-stores shy away from it—markdowns. Adams’ holiday mainstays are Hershey’s Reese’s Pumpkins at Halloween, Standard Candy Company’s Pecan Logs at Christmas, Tootsie Roll Industries’ Cella’s Heart Box Cherries for Valentine’s Day, and Cadbury Eggs for Easter. All of these items are sold at Huck’s two counter spots. “The Reese’s Pumpkins and the Cadbury Eggs are the only items that we have to mark down after the holiday, but we have very little leftover of those two,” says Adams. “The Pecan Logs can sell at regular price after Christmas (although we rarely have any left), and the Cella’s cherries can be dumped out of the heart-shape box and sold as individual pieces.” Seasonal products that shine for Adams are those that he can find homes for after the fact. Cella’s chocolate-covered cherries, which go from boxed sets to changemakers, are a perfect example.

Exit Strategy

One crucial item Adams looks for from candy manufacturers and brokers prior to purchasing product is an exit strategy. “If we’re going to take a chance and bring their item in, we need to know what they can do to help us if it bombs,” cautions Adams. “Too many companies don’t want to admit that there’s even a chance of that happening, but it does.”

Sometimes, Adams says, new sales representatives who call on him mistakenly assume c-stores operate just like supermarkets or mass merchandisers—and they don’t. “They need to understand the profit we have to make, the turns we expect, and the exit strategies we need. I’ve learned one valuable lesson in this job: The retailer doesn’t remember what sells, but they never forget what doesn’t sell. Tell me up front what we’re going to do when this promotion is over.”