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    INDEPENDENTS REPORT: Fuel economy

    The addition of a filling station at Kishman's IGA in Minerva, Ohio has pumped up sales -- not to mention customer enthusiasm -- considerably.

    For customers of Kishman's IGA, grocery shopping truly is a gas. Owned by IGA International Retailer of the Year Tom Kishman and his wife, Jan, "the friendly store with so much more," in the words of its motto, recently celebrated the grand opening of Kishman's Gas n' Go, a nonbranded fuel station built in the parking lot of the 50-year-old supermarket.

    "During the past couple of years, business was flat," explains company president Tom Kishman. "Like most independents, we were searching for ways to increase volume and generate extra excitement in our store. We felt strongly that adding a fuel station would give us a competitive edge in our market and create a lot of unique marketing opportunities. Offering fuel would give customers yet another good reason to shop at Kishman's IGA."

    So last August Kishman, a second-generation single-store operator, teamed with his grocery wholesaler, Kentucky-based Laurel Grocery Co., and started constructing the fuel station. Laurel aligned the retailer with Tanks Plus, an Anderson, Ind.-based fuel broker, which coordinated the planning and building of the turnkey facility.

    "The entire process from start to finish took about 10 months," notes Kishman. "Both Laurel and Tanks Plus offered decent pricing and good creative ideas on how to market our facility. Sure, we looked at a few other fuel programs out there, but we chose to work with Laurel because of their history of delivering outstanding service to our company."

    While Kishman has implemented many of his supplier's marketing ideas, he's also launched a number of innovative fuel promotions on his own -- programs that the 3,800 consumers who live in Minerva, Ohio aren't likely to find at the local Citgo or BP station.

    Mother's Day 2003: Imagine moms visiting Kishman's Gas n' Go and having their gasoline pumped by a gentleman sporting a black tuxedo and offering flowers. Who was that elegant gas station attendant? You guessed it -- Tom Kishman himself.

    And Kishman wasn't about to forget dear old Dad. Members of the Minerva High School girls' volleyball team volunteered to assist the retailer on Father's Day, presenting as a gift to each of the first 200 dads a pair of jersey work gloves, compliments of Kishman's IGA.

    'Ping-pong marketing'

    According to store manager Darcy Scharver, the supermarket's 90-plus associates have crafted the store's most successful fuel promotions so far.

    "Each week we brainstorm ideas at our weekly operations meetings. Ultimately our goal is to get our supermarket customers to visit the fuel station -- and our fuel station customers to shop at our store. We call it 'ping-pong marketing,'" she says with a laugh.

    Other sales-building promotions developed by the Kishman's IGA team include:

    -Graduation Rewards: By purchasing specific graduation party items from the supermarket, customers received coupons for cents off per gallon at the gasoline pumps. Examples of Graduation Rewards items included 20 cents off for a full sheet cake from the in-store bakery and 10 cents off for a large vegetable tray from the produce department.

    -Picnic Rewards: Launched this summer, the Picnic Rewards marketing program mirrors the Graduation Rewards promotion.

    -Fuel Rewards: Customers earn cents off per gallon of gas by purchasing specially marked items throughout the supermarket. Each month 10 items are announced in "Kishman's Gas n' Go Gazette," a monthly customer newsletter.

    -Buy groceries, earn free gas: At the supermarket checkout, customers receive coupons for cents off their gasoline, based on the total amount of their grocery purchases. The coupons, which are generated by the retailer's NCR Scanmaster cash register system, may be redeemed at Kishman's Gas n' Go. Savings examples include two cents off for a $10 receipt, five cents off for a $25 receipt, and 10 cents off for a $50 receipt.

    "This program doesn't apply to tobacco products, and the reward amounts may not exceed the amount of the gasoline purchase," says Kishman.

    -Buy gas, earn free groceries: "Gasoline customers are often presented with coupons that can be redeemed in our supermarket," notes Scharver. "For example, last month we distributed certificates for a free bag of potatoes with every fill-up. Again, we work hard to bounce customers back and forth between both facilities."

    "Overall, we've found that customers respond best to 'cents off per gallon' promotions vs. saving x number of dollars on their total gasoline purchase," observes Kishman. "Certainly this summer's fuel crisis and the rising cost of gasoline have made everyone more aware of the price per gallon."

    He adds: "First and foremost, I view myself as a grocer. The fuel station has become an integral part of our supermarket operation, and it has really had a positive impact on our sales. While we don't proclaim to be the cheapest store in town, we do guarantee that customers who shop at Kishman's IGA can save money on their fuel bills."

    Independent Retailing Editor Jane Olszeski Tortola can be reached at [email protected].

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