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AAFES’ tinkering pays off in new exchange site

BY Michael Johnsen

TINKER AIR FORCE BASE, Okla. —The opening weekend of Tinker Air Force Base’s new Exchange concept—rebranded from the Army and Air Force Exchange Service—in mid-September kicked off to great success. The store posted a 133% jump in sales as compared with the same weekend a year ago.

“We couldn’t be prouder of this new look and are excited about unveiling it in the future at Exchanges around the world,” stated Exchange Commander Maj. Gen. Bruce Casella. “This facility is setting the standard for future generations, and, based on the number of excited shoppers in its first weekend, is definitely a hit with the Tinker community.”

The new layout is divided into three major merchandise departments—Home, Life and Style—and features wider aisles for ease of shopping, AAFES reported. In addition, the customer service section was moved to the front of the store to offer service immediately upon entry.

Also, the military retailer’s new tag line, “You save, we give back,” emphasizes the Exchange’s competitive prices and support to Air Force Services and Army Morale Welfare and Recreation programs.

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CVS’ future rests on front-end, private-label evolution

BY Antoinette Alexander

NEW YORK CVS Caremark has no doubt been a trailblazer in the healthcare arena, positioning itself along the front lines to leverage its various points of care to improve outcomes and lower healthcare costs. But with all that CVS Caremark has done and will continue to do in the healthcare space — and it is no doubt a lot — it still has more than 7,000 retail locations, and the front of the store continues to be a critical part of its business and a major growth driver for the company.

(THE NEWS: At his last analyst day, Ryan sets out course for future CVS Caremark. For the full story, click here)

The front end is an $18 billion business for CVS and to be sure the company continues to look for ways to drive even more productivity out of its stores. It comes as no surprise that one area it will target for additional growth is private label. Private-label penetration currently stands at 17%, and over the next two to three years, company executives expect that number to grow to more than 20%.

"Private-label brands continue to grow and evolve. In this economy, consumers have shown that they are much more willing to try private-label products," Mike Bloom, EVP merchandising and supply chain, told analysts during Friday’s 2010 analyst meeting in New York. He noted that by the end of 2010, CVS/pharmacy will have nearly 5,100 private-label items storewide, which is an increase of 900 items versus last year. Each year, the company adds about 900 new private-label items and leverages ExtraCare to encourage trials among cardholders.

What is news, particularly to suppliers, is that a key component of CVS’ private-label program is an entirely new line that the company plans to introduce in February 2011, called Just The Basics — named to clearly communicate its functional, value-priced, smart, simplicity positioning. What is significant is that the new line is not a national-brand-equivalent type execution, but rather, more of a basic entry-point, low-price alternative.

"Now, while many retailers are stuck in the brand-follower mode of the 1980s, we have evolved to a leadership role," Bloom said.

The company also is increasingly turning to "treasure hunt" items and is using its circulars to drive front-end sales. For example, it recently promoted a WiFi-capable Netbook for $99.99 on the front page of its circular. While a Netbook isn’t your traditional drug store product offering, it has proven to be a hit among shoppers. CVS sold $3 million worth of Netbooks in three weeks, and it will be a $15 million item at CVS, the company said.

Then there’s beauty. As the article states, CVS is piloting a mini format of its Healthy Skincare Centers (in 120 stores) and will launch in January an ExtraCare Beauty Club.

Clearly the front end continues to be a significant growth driver for CVS and that will continue to be the case for a long time to come.

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Natural rodent repellant Fresh Cab available at retail

BY Allison Cerra

BISMARCK, N.D. An all-natural rodent repellant continues to gain a stronger retail presence with more than 3 million pouches sold, which come in convenient four-pack boxes.

Earth-Kind’s Fresh Cab, created by gardener and environmentalist Warberg Block, uses ground corn cobs soaked in essential botanical oils and packaged in small biodegradable pouches.

Fresh Cab is sold at 15,000 home, garden, hardware and farm and ranch stores throughout the nation.

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