Sales UpdateMr. Randy Chandler
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Sales Thru 2nd Qtr Versus LY Versus Goal
+3.5%$2.86B +1.9%
DeCA Sales
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Transactions Thru 2nd Qtr
# Versus LY % Change
+275K45.8M +0.6%
DeCA Transactions
Eastern Region
SalesSales
$1.28B (+4.5%)
$.24B (-.3%)
$1.34B (+3.3%)
All Figures Thru 2nd Quarter
European Region
Western Region
Regional Results
Eastern Region
TransactionsTransactions
20.7M (+1.6%)
5.3M (-3.3%)
19.8M (+.6%)
All Figures Thru 2nd Quarter
European Region
Western Region
Regional Results
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Sales Up Prices Up* Real Growth
2.1%3.5% 1.4%
DeCA Middle InningsSavings Hold Steady
•Include produce and meat growth = 1.7%
•CONUS 6 month
Europe
Europe
Europe
Far East
Far East
Far East
West
West
West
East
East
East
The End of Cheap Food?Healthcare Costs
Oil Price Surge
Weak Dollar
Drought in Grain Areas
6 years of drought in Australia
Flooding in Argentina
Demand
Beef consumption in China has doubled since 1980
Impact of Ethanol
Water
It takes 450 lbs of
corn to produce enough
ethanol to fill an SUV gas tank
It takes 800
gallons of water per person per
day to produce
daily food intake
Corn
1,500 gls water = 1lb beef
7 lbs corn = 1lb beef
2.5 lbs corn = 1lb poultry
Sustainability
Consumer Impact
FMI Trend Reports
71% increase home cooking frequencyMeals up 4.9 per week
67% buying fewer luxury items
60% buying more store brands
Value Will Be Focus
Fewer Trips to Secondary Stores
Fewer Trips = STOCK UP
Sales Directorate (PS)Director Sales
PS
*PerishableDiv. PSP
Product Support Applications Div. PSA
Resale Contracting
Div. PSC
Special ProjectsDiv. PSS
Proposed New Name: Business Systems, Transportation and
Cataloguing Div. (PSV)
Semi-PerishableDiv. PSM
Produce Support Branch PSCP
Produce Cell Europe RDCE
Brand Name Resale Branch
PSCB
Resale Commodities Branch PSCC
Resale Service Support
Branch PSCS
Reset BranchLS PSSR
Change Pending: Move Distribution/OPP
Branch to PSS – Org Code Pending
Business Systems Branch
PSVS
Transportation Branch PSVT
Promotions Branch PSSP
Proposed New Guard/Reserve Branch –
Org Code Pending
Michelle Frost, Chief Semi-Perishable
Developing staff office for Guard/Reserve support
Serves as single POC for store support from HQ
Logistics
Human Resources
Communications/IT
Second destination transportation
Equipment
Develop a “Virtual” solution for guard sales
Internet ordering – on site payment first step
Develop total internet solution - include pre-payment
Expand Benefit Access G/R
Category Reviews
Six Reviews Completed YTD
Two Reviews Currently Underway
One More Scheduled
3 Reviews Pending
Currently Developing Next Years List
PromotionsTotal Items Published Reduced by 21%
Easier management at store
Increased SKU Performance
Dollars per SKU up 5%
Units per SKU up 7%
Increase Pallets/Shippers
Incorporate Club Packs
Averaging $6.8 million per month $2 million per month increase
Seasonal Sales + $9 million
Front End Racks
Fixtures Have Been Selected
Currently:
Developing Stock Assortment
Surveying Stores to Determine Type of Fixture
60 Days to Manufacturer Equipment
Phased Implementation Beginning September
Plan-o-gramsToday all store use standardized plan-o-grams
Based on historic sales patterns
Specific sets based on store class size
No factor included for lost sales
Plan-o-gram for the “Future”
Pre-position space for growth categories
Refine assortments in declining categories
Re-configure flow to maximize allocation efficiencies
Test concept at Ft Bragg North On track for early summer implementation
Measure incremental impacts
Analyze DataAnalyze Data Review SiteReview Site Build Store PlanBuild Store Plan
- Analyze demand - Adjust for volume sold
on display - Plan-o-gram specific
shelf objectives
- Analyze demand - Adjust for volume sold
on display - Plan-o-gram specific
shelf objectives
- Map flow of sales area
- Align categories tobuild affinities
- Assure growth can
- Map flow of sales area
- Align categories tobuild affinities
- Assure growth can
- Make needed adjustments - Plan/organize reset
- Measure results
- Make needed adjustments - Plan/organize reset
- Measure results
The Ft Bragg Project
• Environmental Initiatives (Retail)• Reusable grocery bags sold starting 10/30/2007
• Status: Over 1,007,000 sold thru 05/14/2008
• AFN Video on commissary reusable bags shown in Europe
• Compact fluorescent light (CFL) bulbs, FY 08 Goal: 1 Million
• Status: Over 733,000 sold FYTD – thru 05/14/2008
• Smart-Way Transport Program (EPA Partnership)• Status: 12 DeCA Transport Partners now participate
• Notice to Trade about program published 01/29/2008
Focused onFocused on “Green”“Green” EffortsEffortsFocused onFocused on “Green”“Green” EffortsEfforts
• Environmental Initiatives (Retail) -• Earth Friendly Days Promotion featuring Go Green products
• Status: April 17-30, 2008 Promotion implemented
• Coincides with Earth Day (April 22) and Arbor Day (April 25)
• Green Clean, Recycled and Biodegradable Products• Status: Number of items has almost tripled over last 12
months
• Organic Products• Status: Sales up 40% (Apr–Mar over prior year) 24.0m to
33.5m
• Selection up 39% in last 12 months – from 460 to 641
Focused onFocused on “Green”“Green” EffortsEffortsFocused onFocused on “Green”“Green” EffortsEfforts
NIB – People Helping People
NIB Sales Top $14M in Most Recent 52 Weeks
Traditional Skilcraft Brands - $9.0M
Impulse Programs Add $5.1M