BJ’s bubbles with CSD merchandising

Warehouse clubs might not seem to be the retailers best suited for building on carbonated-soft-drink introductions, given the SKU restrictions they undertake. However, BJ’s doesn’t regard itself as at a disadvantage, even given expanding CSD assortments and complementary product additions.

Working the business model is the key, and in doing so, BJ’s makes a virtue of necessity. “You still look at the 80/20 rule,” senior vp of grocery and perishables Bruce Graham told Retailing Today. “You have to be relevant to the members.”

BJ’s, which had been relatively expansive with SKU count early in the decade has lately become more conservative about the number of items carried. These days, BJ’s carries four kinds of Coca-Cola, for example, three of them low calorie. Yet, although that’s just part of Coca-Cola’s product assortment, incrementally adding one to the other, it fulfills what customers need from BJ’s.

Graham noted that line extensions are welcome, even if BJ’s won’t carry more than a handful of products in any given brand. Big promotions provide BJ’s with both sales opportunities and a forum for testing new products. The retailer brings them in when the vendors are spending major dollars on the introduction, then sees how customers respond as the initial blitz gives way to a sustainable marketing spend.

BJ’s offers the most popular CSDs, and a selection of alternatives, too. For example, complementing the CSD space selection, BJ’s may offer Izze Sparkling Juice—in fact it offers a multipack with three varieties, Blackberry, Clementine and Pomegranate—and its own brand Berkley & Jenson Sparkling Water Beverages, which can help the retailer appeal to health conscious consumers who still favor the fizz CSDs provide.

So, even if it never stocks 100 different soft drink varieties, BJ’s is content with the excitement new products bring to the market. Although it’s basically there to help its members stock up on everyday items and purchases for events, tastes change—and today that’s truer than ever. In beverages, BJ’s follows the currents rather than trying to swim against them and Graham said the approach remains effective.