Delivering a return

Dermot O’Neill, ADM Londis and retailer Micheal Hanrahan Junior

Wexford locals were delighted to see experienced retailers, the Hanrahans, return to their former store within the town

People

21 June 2011

Share this post:

Getting to know your customers and their needs is a key priority for any retailer who has recently opened a new store. However for Michael Hanrahan Junior and his family, this wasn’t a particularly difficult task. The Hanrahans had previously owned their newly-acquired Londis store located at the Faythe in Wexford town for around 12 years, before deciding to sell up five years ago. Then when the shop closed approximately a year and a half ago under different management, ADM Londis approached the Hanrahan family to see if they would be interested in buying the store back. As it happens, they had actually been looking at various shops across Wexford with a view towards expansion. “This came up and we thought this would fit; we can buy into this,” explains the retailer.

Direct experience

Not only did the Hanrahans have direct experience of working in the same shop before, Michael Hanrahan Senior also has 40 years of solid retailing experience under his belt. He kicked-off his retailing career in H Williams, before later opening another Londis store in Saggart, Co Dublin. Michael Hanrahan Junior has also benefited from previous retailing experience. After working in fund accounting for several years, he returned to retail, and took on the role of assistant manager in another store owned by his father in nearby Piercestown. He explains that this is a smaller shop, approximately a 10 minute drive away in a small country parish. “I think my father was looking at it as his retirement shop, but he kept going,” he adds with a grin.

londis1 Hanrahan Junior’s career in retail actually started much earlier though, as he says of the store in Wexford town, that: “I used to work here years ago when I was about eight years of age.” This very early start meant he already knew many of the local customers, who were enthusiastic about the well-known Hanrahans returning to their local shop.

“The people round here were delighted because we know everyone,” says Hanrahan Junior. “It was a bit strange, I never thought we’d be back and he [my dad] never thought we’d be back either, but it’s a good experience. It’s easy to fit back in, rather than if we went down the country somewhere, where you’d have to get to know everyone. We already know everybody and everybody’s saying it’s great to have you back.”

That said, the Hanrahans certainly weren’t prepared to take their customers for granted. They knew their shopping habits would have changed in the intervening years since they were last involved in the store. “When we started off, the shop had only been closed for a year and a half, but we didn’t know how busy we were going to be. It was going to take a while to build up trade because people had changed their habits,” says Hanrahan Jumior. For this reason, they also started staff on lower hours, before gauging the level of demand they would encounter on a daily basis. “If we’d started them on 30 hours, we would have been nervous about taking on other people but the way it is now is that everybody is getting training in every area. That allows people to change between being on the deli and on the till, and there’s another girl getting trained in the office, which means we have much more flexibility.”

A comprehensive plan

Within the town, the retailers realised that they now also faced considerably more competition. There is now a large Tesco supermarket located nearby, and the German discounter Aldi is based in the town as well. They therefore came up with an innovative plan to create a better one-stop shop for their customers that would deliver an enhanced shopping experience. This included installing a doctor’s surgery and a pharmacy at the rear of the premises, which will open in July, with the hope that people visiting them might also call into the store. The shop did have to reduce in size to accommodate this development, but Hanrahan Jumior believes this is a positive change as it creates an ideal store size. “The idea is that it wouldn’t be convenience, but it’d be a big enough shop that you could do a full shop if you wanted to.”

“It’s a lot smaller and a lot more modern, but it’s focused on the same areas that we were always good at; the fruit and vegetables department, the off-licence, and the butcher’s department. We had a great butcher’s here and my father always believed that was important, because people will travel to a butchers.”

Creating a destination store

Offering services such as a good butchery helps local stores to compete better against the multiples in Hanrahan Junior’s view. “Everybody likes their own butcher. If you can get a good butcher’s, such as those that have stand-alone butchers shops, then that’s an area where we can actually compete. We can compete with the likes of Tesco and all the multiples on our butchers, on our service, even our pricing we can compete on, and on our quality, we think we can be better.”

The team are also trying to deliver the best value possible, especially within key categories such as their fruit and vegetables and meats, in order to entice customers to keep returning to the store on a continual basis. Explaining more about the area, the retailer notes that: “There’s two pubs, there’s a bookies up the road, and there’s a lot of houses as well. It’s a working class area so we have to keep our prices low, and we try to keep our margins tight. Londis have a lot of new offers as well, such as the Monday madness and WOW offers, which are always in place.” The traditional basic rules of good retailing also firmly apply at the Hanrahans’ Londis when it comes to securing value. “Always when we buy, I know it’s old fashioned but we try and haggle with the reps, for example, we’ll buy three and get one free and then pass on the deals to the customers.”

Variety-packed offering

The store’s deli, which has several full-time staff, also performs strongly. This includes the Londis Fresh concept, which provides freshly made sandwiches in-store. The deli team also provide a selection of two to three hot dinners daily for the competitive price of just €4.95. The retailer adds; “We had a great name for cooked chickens here before, so we do a lot of good things like that at the till, especially on a Sunday.”

In order to promote the quality of their hot beverages, the store created a promotion to give customers a free tea or coffee whenever they bought a sandwich or roll. “The first week we offered it, nobody seemed to take it. They said no, I’m ok,” notes Michael. “But now we see after a couple of weeks, that people are coming in for that offer. We’re even selling more coffee now as well.”

londis4 To keep on encouraging customers into the shop in this fashion, and building up a strong reputation locally, is the store’s main goal for 2011. “We wouldn’t expect to make a huge amount this year, but we just want to get people back into the routine of coming down here,” says Hanrahan Junior. “The butchers and the deli took off straight away; there’s strong deli competition around here but it just took off.” He adds that that the off-licence is another area which is “always a strong, strong category,” and at the time of ShelfLife’s interview, the team had “gone very tight on margins” in order to drive off-trade sales for the forthcoming bank holiday weekend.

Greater freedom and flexibility

The retailer adds that in general, Londis offers a lot of support, and more flexibility in terms of ordering stock. “We’ve a lot of freedom with Londis,” explains Hanrahan Junior. “Even with the fruit and vegetables, I have two fruit and vegetables providers; I have Doheny’s and Keeling’s, which is the local supplier.” He adds that he uses a spreadsheet to systematically run through who is cheaper, and bases his purchase decision on informed logic.

londis5 “We can make our own decisions, because different areas are different, and every Londis shop is different. Buying from local suppliers also supports the local economy. Londis don’t tell you what to buy or how much to buy, or that you have to put a certain item on promotion. Instead, they give you an outline on what’s on special offer this month and you’re nearly better off to buy them. You don’t have to buy anything if you don’t want to, and you can decide on your own pricings, and your own margins, rather than other symbols that have set price levels.”

He explains that Londis retailers now also gain a 5% rebate when they order through the central billing system. This makes buying through Londis more attractive, he says, because the supplier details are on the system already. He also commends his local Londis representative Dermott O’Neill who visits the store regularly and can always be reliably called on to deliver some sound advice when needed.

Overall, the business is very much geared towards the future at the moment, with Hanrahan commenting that at present the team are trying to achieve a “steady level that we can build on.” They certainly appear to possess an excellent foundation on which to build this future growth, based on their strong standing within the local community, amongst customers who know they’ll consistently strive to deliver the best standards, value and quality.

Share this post: