As the chief executive of Reduced to Clear, the North Island chain of budget grocery stores, Honeycombe should know. Reduced to Clear sells big-brand grocery items - dry goods, not fresh vegetables and meat - that are within a few months of their best-by date; the kind of stuff that generally doesn't make it on to supermarket shelves. Occasionally, it sells goods past their best.
"We'll find out from the supplier what the tolerances are in that particular product and we'll sell within the recommendations of the supplier," he says.
Asked to provide price comparisons, Honeycombe cites Close Up toothpaste at 99c ($2.39 at full retail price), $4.99 for Toblerone ($12.49 elsewhere) and La Cecca Extra Virgin Olive Oil for $7.99 (RRP $12.99).
Honeycombe says he's noticed supermarkets have temporarily lowered prices on some products in reaction to Ready to Clear's entrance, but says they occupy different retail spaces and are not direct competitors. Even so, it will be interesting to check the prices at the local supermarket for Toblerone and Close Up next week.
Reduced to Clear was founded in 2008 by food commodity traders Sean Hills and Andrew Vermeulen, as a one-day-a-week clearance store in Wiri, Auckland. When the concept proved popular, the pair brought in Honeycombe as an adviser to help develop and implement a business strategy. He became a partner and chief executive when they accelerated its expansion across the North Island.
"We've got seven stores now and we're on track to open six stores next year," says Honeycombe. Revenue growth has been breakneck - 185 per cent in the past three years, earning the company 36th place on the Deloitte Fast 50 list, published last month.
Certainly, the timing for the company was excellent, given its inception near the beginning of a long, dark recession; a point Honeycombe acknowledges. After all, the market gap he spotted was the reduced buying power of low and middle-income earners and persistent high unemployment.
But he points out that the thrill of the bargain transcends income levels. A Ready to Clear carpark contains motorcycles, old dungers, cheap Japanese imports and the 4WDs and European marques driven by those of more elevated means.
Honeycombe says Auckland could easily take another three stores besides its Manukau and Henderson outlets but, at this stage, he will only open new facilities in east Auckland and the North Shore. Rotorua and Tauranga branches are in the works and he has yet to decide on two other locations.
Ready to Clear's store network extends from Wellington to Whangarei, but its reach is actually nationwide courtesy of its e-commerce strategy: "We've got 5000 people on our Facebook [site] and 27,000 on our mailing list," he says. "We ship to the South Island, we ship all over, all the way to Invercargill."
The cost of mailing goods is not prohibitive as "we've negotiated pretty attractive postage rates around New Zealand and we don't clip the ticket on those - what it costs us is passed on - and they buy at the same price that we sell in the stores".
As a proportion of the business, internet trade is growing quickly, even though the full range is not yet online, something Honeycombe promises to remedy.
By the end of the financial year, the company will crack 200 per cent revenue growth, he predicts confidently. After that, he wants to open stores in the South Island. Another aspiration is $100 million revenue within 10 years.
"We're going to knock that goal out of the park and I like to think we're going to be there a lot sooner," he says, citing customer satisfaction, as measured by the Net Promoter Score. "It's a totally dynamic business."
