Rite Aid’s category management team and supplier partners gathered in Hershey, Pa., on October 1, 2015, for the bi-annual Supplier Advisory Board (SAB) meeting.
Tony Montini, Rite Aid executive vice president of merchandising and distribution, welcomed supplier partners and outlined the day’s objectives before introducing Rite Aid Chairman and CEO John Standley. Together, they answered questions from supplier partners about current initiatives and the future of Rite Aid.
The first order of business was discussing the development of a new strategy for on-boarding new supplier partners. Rite Aid’s Bill Renz, group vice president of consumables and photo, outlined the goals of the initiative before introducing Christine DeLouvrier from Maybelline, who discussed the current challenges of the on-boarding process and described processes used by other retailers.
DeLouvrier was followed by Alex Botero of Procter & Gamble, who presented a proposal that would provide new account representatives with the information they need to create a smooth on-boarding process. As part of this proposed process, new supplier partners will receive a welcome letter along with a first-meeting checklist and agenda to prepare them for their initial meeting with a Category Manager.
Botero also discussed the addition of quarterly training sessions for new supplier partners to introduce the Rite Aid representatives and explain the marketing structure and systems used by Rite Aid. The first of these new supplier partner sessions was held December 2 at the Rite Aid Model Store in Mechanicsburg, Pa.
Laurissa Rodriguez of Frito Lay wrapped up the discussion by explaining the value of having a defined on-boarding process in place by spring of 2016.
Next, Ted Williams, Rite Aid vice president of general merchandise and seasonal, introduced a discussion about top store merchandising execution. The committee for this area focused on finding the best merchandising concepts and taking them to the next level, using the movie “Top Gun” as their inspiration and theme.
Due to the differences in store formats among the Rite Aid top-performing stores, the team determined that there is no single merchandising solution for all stores. Instead, the group intends to create “flexible merchandising solutions that will enable profitable growth across Rite Aid’s top sales stores, using insights to drive actions.”
The discussion continued, with Doug Rhoads from Daymon Worldwide addressing the “size of the prize”—what it would mean to get customers in top stores to spend 10 percent more than they do currently or add one more item to their purchase. According to Rhoads, both challenges are obtainable and would lead to substantial gains in overall front end sales.
Next, Pia Heine of M&M Mars, and Nick Nichols, Rite Aid Category Manager, talked about building a “tool box” for flexible merchandising solutions. These solutions will cross many areas such as merchandising, marketing, pricing and operations and must be a collaborative effort between supplier partners and Rite Aid teams.
The final committee update, led by Rite Aid’s Group Vice President of Health and Beauty Bill Bergin, focused on “understanding the customer.” This team is continuing the work begun by the Store Segmentation and Micro-Marketing committee.
The presentation began with an update on the F.A.S.T. tool from Rob George, Rite Aid director of market research, real estate. The F.A.S.T. tool is a segmentation report in 1010Data that shows store performance grouped by different demographics to identify areas of opportunity.
Unilever’s Frank Carlesimo and the team continued the F.A.S.T. discussion by highlighting the influence and buying power of multi-cultural consumers and their impact on Rite Aid’s growing markets. With an ever-increasing and ever-changing population, the team focused their attention on attracting and retaining Hispanic shoppers by identifying challenges to those consumers. Barriers related to shelf arrangement, product selection and a lack of bilingual signage were determined to be key challenges to this demographic.
The team plans to begin addressing these barriers by testing an Oral Care planogram that is benefit driven, bilingual, inclusive of key items and aligned with sub-brands.
Montini concluded the meeting by congratulating recent supplier partner membership renewals and thanking them for their contributions. All three committees will continue working throughout the next several months and will provide final updates at the next Supplier Advisory Board meeting to be held in Las Vegas on Tuesday, March 22, 2016.