Scottish Grocers’ Federation is the national trade association for the independent convenience store industry in Scotland. There are almost 5,300 convenience stores in Scotland—these stores provide 41,000 jobs and contribute some £530 million to Scotland’s economy each year in Gross Value Added. Fundamentally, they are here to represent their members’ interests and ensure a profitable and sustainable convenience store industry in Scotland. 2018 has been a landmark year for them – founded in 1918, they are celebrating 100 years of the Federation. Throughout that time, they have supported the industry and helped it to evolve and adapt to an ever-changing market and ever-changing customer expectations. The centenary has been an opportunity to look back on and celebrate the past, but also a unique opportunity to plan for the future and ensure that they continue to be relevant to their members.
The senior team at SGF works with the 26-member National Executive, which is the governance and decision-making body for the Federation. The National Executive is comprised of the key figures from across the industry in Scotland. SGF also has a buying group which provides vital support to stores in rural and island communities.
CEO Today spoke with Pete Cheema, SGF’s CEO about the company, the state of the economy, and the history and the future of the retail industry in Scotland.
Having joined the Board at SGF in 1999, how did you manage the transition to CEO of the company in 2015? What would you advise to others going through a similar process?
One of the biggest problems was that the organisation was simply not being run as a business. Fortunately, I have an extensive business background and also direct experience as a retailer. We had an urgent need to both maximise income and drive costs out of the business. I initiated a 360-degree review of costs and have I think it’s fair to say got better deals for us on everything from the photocopier, the phone system and the IT hardware. We have also been very successful in commercialising our events by attracting sponsorship and by providing partner companies with genuine opportunities to showcase their products and services. I also gave a priority to rebuilding relationships with key companies and leveraging in their support for the change agenda that I was determined to drive through. We are essentially a membership organisation and we now build membership around a genuine partnership approach underpinned by the realisation that we have to demonstrate value and a return on investment.
My advice is to identify what you have to do and do it quickly. Ensure you take your staff, Board of Directors and key partners with you. Building relationships with openness, honesty and integrity are absolutely vital.
What does an average work day look like for you?
There are so many issues that impact on retail and we have such a wide membership base that there is rarely any such thing as a typical day! Effective time management is crucial as is building a strong staff team around you. A chief executive has to be able to delegate and be confident in the ability of his staff to deliver on key priorities,
You were awarded an OBE (Officer of the Order of the British Empire) in the Queen’s Birthday Honours List in 2018 – can you tell us about this award and what it meant to you?
I think a lot of people still have a bit of a misconception about how the honours system works. You don’t get nominated by the civil service or the government. In fact, the nomination comes from people you know: work colleagues or people in your community who want to recognise your contribution and shine a spotlight on the causes you have devoted your time to. For me, this makes it even more of an honour and is all the more reason to accept it. It’s as much on behalf of the people who have been kind enough to nominate you as it is on your own behalf.
The award is really not for me but for everyone who has been a friend, partner or member of the Scottish Grocers’ Federation throughout its 100-year history: the people who gave so much to the Federation and ensured that it has not only survived but thrived for 100 years
Are there any current projects you’re working on that you could share with us?
We have initiated a new strand of our strategic plan, this is called ‘creating effective partnerships’. Essentially it involves reaching out to and creating partnerships with sectors which we have had no relationship with before. The rationale for this is that convenience stores need a broad range of services: financial, legal, security, IT, utilities and licensing. We have been very successful in bringing on board companies who can offer these services to our members with an assured level of quality and cost.
Of what importance is community to SGF?
One of the key aims of SGF over the past 100 years has been to promote responsible community retailing. Convenience stores are at the heart of our communities – in Scotland over 80% of convenience retailers are irregularly involved in community engagement activities. This year, with the support of one of our key corporate members, we have initiated the ‘community heroes’ award to celebrate and recognise the contribution retailers make to their communities.
Have there been any substantial changes you’ve noticed in the industry during your career? How have these affected you and your work?
The industry is currently going through its biggest period of change ever. Major retailers and wholesaler are merging as they seek to maximise buying power, maximise economies of scale and maximise their distribution channels. The grocery retail market is hyper-competitive and one of our key tasks is to help our members respond to this and ensure they can compete. Working in partnership with the Scottish government we have established a grant funding program to enable our members to develop a high-quality food-to-go offering for customers.
What is the SGF Healthy Living Programme and what was the most challenging aspect of leading it?
The programme almost literally pushes healthy eating options to the front of the store. It has been very successful in encouraging customers to increase their purchase of healthy eating options. The team supports retailers with advice on ranging, merchandising and positioning. There are now over 2,000 stores participating. The key challenges of leading it were to ensure that the programmer had effective governance and that it became more fully integrated into SGF’s strategic and operational activities.
What is the current state of the economy in Scotland? Does SGF have an effect on this and vice versa?
As with the rest of the UK, low productivity is one of the key challenges for Scotland’s economy. The number of jobs – 41,000 – provided by our sector is often overlooked particularly when the total supply chain is added in too. We need government to be realistic about the cumulative impact of costs on retailers – staff costs, business rates, energy bills, waste management – if these jobs are to be protected.
Has the state of retail and the high street been affected by the ongoing prevalence of online shopping? What is your opinion of this?
On-line shopping has had a big impact. But it has mostly affected the bigger high street retailers. In the convenience sector, online shopping is much less prevalent: customers prefer the very friendly and personalised service they get in a good convenience store. People in Scotland increasingly like to shop local and to shop often. The average shopper visits their local store almost four times per week. Convenience stores are very well placed to meet the changing habits of customers if they can ensure their offering and customer service are of a high enough standard.
Do you have any tips for providing advice and guidance on retail and wholesale matters?
Become a member of SGF! Pick up the phone now!
What’s in store for the future of SGF and the retail industry in Scotland?
The industry will certainly remain very dynamic, with change being a constant feature. One of the key roles for SGF is to provide effective leadership to the industry and to bring it together across the supply chain. We are uniquely well placed to do this: many of our larger retail-group members are also major wholesalers and we also represent most of the major manufacturers, many of whom operate at a UK level. We have a major part to play in helping to steer the industry through this time of change.