Does Size Really Matter?

Nic Jooste, European Market

Originally printed in the December 2018 issue of Produce Business.

Ask this question of the owner of the SPAR City Store in Utrecht (a beautiful old city in The Netherlands), and he laughs heartily.

Serving more than 10,000 customers weekly from a store area of just over 1,200 square feet, the SPAR City store is an example of a new generation of exciting small stores from this ‘grand old lady’ of Dutch retail.

When I arrived in The Netherlands from South Africa in 1993, I came from a shopping culture that had evolved into the American model of hypermarkets and superstores. From cabbage to car batteries, fennel to fridges, tomatoes to televisions — you could buy it all in the same store, and bigger was definitely better! At the same time, in our suburban neighborhood, we also had a number of small convenience stores, mostly owned by Greek immigrants. They sold just about everything; take-away food, lots of fresh produce, milk and bread, as well as a range of dry groceries. They were open from 6 in the morning, sometimes only closing way past midnight.

Growing up, the trend in our neighborhood was to do our ‘big shopping’ once a month, normally on day that my parents’ salaries were paid. Thereafter, we made daily trips to the neighborhood cafe for milk, bread, the sugar that had run out, or cheese for school sandwiches. The Greek owner of the store closest to our house called me ‘Neekee.’ But he did know my name …

Upon arriving in The Netherlands, I was so happy to once again experience a proper neighborhood convenience store in our village! The owner, Mr. De Bruijn, knew everybody by name. And then in the period 2000-2010, it all changed. Big and modern supermarkets became the new standard. My village became home to three large supermarkets, where new managers came and went faster than you could say ‘bring back the good old times where the owner knew me by name.’ Mr De Bruijn had no option; he closed his shop and retired.

It was with great excitement that I recently stopped at a neighborhood gas station, and on entering the shop area, I was blown away by a mini-sized SPAR supermarket with a complete selection of ‘proper’ supermarket items. This on an area of 860 square feet, which includes a fresh orange juice machine, a bakery with croissants and fresh sandwiches, even a fridge containing fresh pizza’s just ready for a fast bake-off.

This prompted me to immerse myself in the world of SPAR International, and the trend of ‘going smaller.’ The original name (DESPAR) is an acronym for the Dutch ‘Door Eendrachtig Samenwerken Profiteren Allen Regelmatig,’ which translates into English as: All benefit from joint co-operation. SPAR says of itself: ‘SPAR is the world’s leading voluntary food retail chain. The business started with one Dutch store in 1932 and now comprises more than 12,700 stores in 48 countries on four continents. At the heart of the company’s core values is the commitment of SPAR stores worldwide to freshness, choice, quality and service.’

My subsequent research shows that SPAR was really the first retailer in The Netherlands to understand that while the big stores were going about business as usual, new types of consumer were developing. Continuously on the move and being really immersed in their busy and fast lifestyles, these consumers have developed erratic eating rhythms. That being said, they are in need of convenience, as well.

SPAR has taken note: On a daily basis more and more people are deciding later on in the day what to eat, when and where they were going to eat and how much they were going to eat. Most importantly, current research also shows that as consumers are ordering more and more ‘standard groceries’ online, they are also often finding themselves running out of specific items. With SPAR being present in most neighborhoods and having a really good assortment, the company has been concentrating on developing stores that instead of going bigger are addressing the needs of the new ‘erratic’ consumer from a limited sales area. As an extension of this, SPAR is rolling out 150 of these small stores at gas stations all around the country. It is being described as one of the boldest moves in the history of Dutch retailing, and as I am writing this, a number of other retailers are following suit. But the story does not stop here …

Recently, I was privileged to host the retail tour at the Amsterdam Produce Summit, during which we visited a number of SPAR stores. We went from surprise to open-mouthed amazement, with especially SPAR University blowing our minds! This niche retail concept is located at eight Dutch universities. We visited the store at the University of Utrecht.

Servicing around 30,000 students from a store area of a mere 4,300 square feet (one third the size of an average Dutch supermarket), the store’s ‘grab-and-go range’ is built around seven ‘student-specific’ eating moments. A student can pick up anything for ‘now or later.’ SPAR University was the first in the world to install a 100 percent self-checkout system. This cashless environment increases security and speed, and fits in better with a student’s need to pick up quickly and pay easily via his/her mobile phone. With its own custom-built app, SPAR University adds real value to its clients, such as making sure students can score free coffee and get the best deals with super discounts. Most importantly, via the app, SPAR stimulates students to make conscious and healthier choices.

SPAR University also puts huge efforts into ‘no waste.’ Instead of selling bottled water (creating more plastic waste), SPAR became the first retailer to offer its clients free tap water in-store. Students simply bring their own (water) bottles and fill up while shopping. This ‘Join the Pipe’ project focuses on bringing the cleanest possible tap water to consumers. Last but not least, by working with a number of ‘Green Offices & Sustainability Hubs’ at university locations, SPAR is involved in many projects in the field of (food) waste. I just love the way that they are rewriting the history book of retailing!

My opinion?? It’s not all about the size, it’s all about the service!

Nic Jooste is the director of marketing and CSR at Cool Fresh International, a Rotterdam-based global marketing organization for fresh produce.