Further written evidence submitted by
the Director of Catering and Retail Services
RETAIL SOUVENIR SALES—BEST SELLING
LINES
PURPOSE
1. As requested by the Committee, this paper
provides further information about the market for souvenirs within
the Parliamentary Estate and provides an analysis of the top-selling
souvenir items sold by the House of Commons Catering and Retail
Service.
2. Analyses of the top-selling House of Commons
souvenir lines, are set out in Annexes A-D.
MARKET PROFILE
3. Historically, the main market for the House
of Commons retail outlets has been Members (of both Houses), Members'
guests and pass holders. CRS defines this as the "internal
market". The House of Commons competes with the House of
Lords for the internal market in particular. Although Members
and other pass holders remain an important part of the business
today, "the external market", in the form of visitors
to Parliament, represents an increasing market share.
4. Broadly speaking, Members and pass holders
of both houses use both the main kiosk and St. Stephen's Shop
to purchase souvenirs. Visitors, unless escorted, are unable to
access the main souvenir shop in the Medals Corridor, as this
is located in a secure part of the Palace. However, since the
shop opened in St Stephen's Hall, there has been a noticeable
drift of the internal market away from the main souvenir shop
to the shop in St Stephen's Hall. This trend appears to be largely
due to the ease of browsing the goods on display in the larger
shop area in St Stephen's, indicating that there may be scope
to combine the shops into one, if sufficient suitable space can
be identified in an easily accessible location.
5. During the summer recess and on Saturdays,
St Stephen's Shop opens to visitors following the official Parliamentary
Tour. Visitors are made up of a mix of constituent and educational
visitors, plus a significant number of tourists.
BEST-SELLING
PRODUCTS
6. Dark chocolate mints remain the highest selling
House of Commons souvenir item, contributing 8% of total sales.
7. These are closely followed by House of Commons
Whisky contributing 6.5% of sales, House of Commons Champagne
at 3.7%, and Speaker Malt at 2.3%. Combined, these three own-label
items wines and spirits contribute over 20% of total sales, generating
a combined income of £226,000 and a profit contribution of
£74,000.
8. Other top-selling product lines are:
| — Big Ben pencils
| 13,400 |
| — House of Parliament Guidebooks |
6,300 |
| — Diaries | 6,100 |
| — Torch key ring | 4,000
|
Combined, these four lines generate sales of £40,000 (7%
of the total).
9. Overall the top 10 sellers contribute 30% of total sales.
TOP SELLING
PRODUCTS, BY
VENUE
10. The main kiosk shares many of the top 10 sellers, but
the kiosk is the only venue that sells the full range of souvenirs
and own label wines and spirits. For this reason sales of whisky,
champagne, red and white wine contribute over 14% of sales. The
kiosk sells over 3,000 pencils of two styles as well as the luxury
chocolate box, chocolate coin and chocolate bag selling over 2,800
items. The roller ball pen is the highest selling pen selling
715. The top 10 items contribute 36% of total sales for the kiosk.
11. St Stephen's Shop top sellers closely reflect the global
top sellers but sells less own label wine and spirits, in part
due to size and storage constraints in the shop. However whisky
remains a strong seller. Unsurprisingly, given its customer base,
guidebooks are a very popular lines, and 6,300 were sod last year.
The gross profit from sales of the guidebooks and some other product
lines is transferred to the Speaker's Art Fund. Other lines such
as the executive jotter, bridge set, marble pen and tankard feature
in the top sellers. The top 10 items contribute 24% of total sales
for the shop.
TOP SELLING
PRODUCTS, BY
PROFIT CONTRIBUTION
12. The top 10 sellers achieve healthy profit margins except
for the own label spirit and wines, which yield high cash contribution
profit but low profit margins. This is because they must remain
affordable within a highly competitive market, where consumers
value-for-money perceptions are strongly influenced by the supermarkets.
13. Globally, the Big Ben 3D pencil and pencil with eraser
prove the biggest contributors to profit, followed by mint chocolates
and the guide book. All these products represent the key characteristics
of what is important to external buyers, namely;
- Memento of visit.
- Value for money.
- Unique quality.
PRICE POSITIONING
& BRAND IMAGE
14. A benchmarking exercise was conducted last year and some
souvenir prices were increased. Benchmarking on retail lines is
more challenging as like-for-like comparisons are not always possible.
There is, therefore, an significant element of professional judgement
based on observation of the customer behaviour and feedback.
15. The selling prices of the top 10 selling items range from
£1.50 to £28.50. Excluding alcoholic beverages, the
highest selling price comes down to £15.00. This is demonstrated
in the relatively low spend per head, indicating that the market
for House of Commons souvenirs is very different to that of, for
example, the Royal Collection, which readily sells products of
£25+.
16. With growing awareness of income generation and the possibility
of an external shop there is scope to further develop a parliamentary
range that delivers what visitors wish to buy but also engineers
an improved profit margin.
17. Images of Big Ben and the façade of the Houses
of Parliament are iconic, and, unsurprisingly, are unfailingly
the best selling lines. Historical artefacts and merchandise drawn
for the House of Commons works of art collection are less attractive
to the broad market and are much more difficult to sell. The internal
market more readily identifies with the portcullis logo and Pugin
artwork, but the general public are less likely to purchase these
products.
January 2011
Annex A
TOP SELLING SOUVENIR LINES, PROFIT CONTRIBUTION AND %
OF SALES
| | Selling
price
| No. of sales | Profit
Contribution
| % of total
sales |
| 1 | HoC Whisky | £20.50
| 3,516 | £23,600 | 6.5%
|
| 2 | Dark Chocolate Mint (large)
| £6.95 | 7,159 | £16,000
| 4.1% |
| 3 | Dark Chocolate Mint (small)
| £3.75 | 11,632 | £17,100
| 3.8% |
| 4 | HoC Champagne | £23.00
| 1,766 | £9,800 | 3.7%
|
| 5 | Speaker Whisky | £28.50
| 906 | £7,400 | 2.3%
|
| 6 | Diary | £3.99
| 6,127 | £9,800 | 2.2%
|
| 7 | Guide Book | £5.00
| 6,373 | £12,000 | 2.2%
|
| 8 | Big Ben Pencil | £1.50
| 13,453 | £12,000 |
1.8% |
| 9 | Hoc Vintage Port | £13.50
| 1,435 | £7,000 | 1.7%
|
| 10 | Luxury Chocolate Box |
£11.00 | 1,836 | £8,000
| 1.7% |
| 11 | Pen | £6.95
| 2,140 | £6,100 | 1.3%
|
| 12 | Torch Key ring | £2.95
| 4,072 | £5,200 | 1.1%
|
| 13 | Christmas Mug | £15.00
| 830 | £4,200 | 1.0%
|
| 14 | Bridge Set | £8.00
| 1,417 | £5,000 | 1.0%
|
Annex B
TOP 10 SOUVENIR LINES BY VOLUME AND VALUE
(INCLUDING PROFIT CONTRIBUTION)
Annex C
TOP 10 SALES BY VOLUME AND VALUE MAIN KIOSK
(INCLUDING PROFIT CONTRIBUTION)
Annex D
TOP 10 SALES BY VOLUME AND VALUE ST STEPHEN'S KIOSK
(INCLUDING PROFIT CONTRIBUTION)
|
