The local supermarket has just finished remodeling to keep itself competitive.

Store makeover reflects new business model

Larry Waterfield

The produce department still anchors the store to a large extent. The department looks better, with more wooden tables, and changes in displays to give a somewhat more natural look that is less antiseptic.

There are a lot more organic choices. The store has kept the salad bar and spruced up the flower department. Produce is definitely the place to differentiate the store and set a tone.

The grocery sections now have higher shelving, which probably saves on distribution costs. But how much can you do to improve grocery aisles?

(By the way, this is the anniversary of the invention of the can, as in canned vegetables. The can hasn’t changed that much in 200 years since Frenchman Nicholas Appert perfected preservation techniques, first in bottles, then in tin cans.)

In the rest of the store, a few other changes were made, but the meat, bakery, deli, beer and wine sections remain the same. The pharmacy must rake in plenty of money, but there were few changes there. There is a nicer olive bar, with a wide display of olives and related items. Some areas now have wood flooring.

Up front, there are more self-service checkouts, but the store resisted the urge to put in tables, chairs and a coffee and eat-in area.

Overall, I’m surprised the huge store didn’t do more to soften the stark institutional look that speaks of the 1990s.

This store is part of a chain that in turn is part of a much larger retail organization. It has enjoyed a big market share, but that has slowly eroded, with more competition from both high-end stores and those at the lower-priced end.

People shop in more places, including Whole Foods for “alternatives” and at Wegmans for a huge variety of prepared foods and moderate prices for everything else.

Safeway has remodeled many of its stores and made them more attractive and shopper-friendly, and less institutional. Other competitors include some that feature lower prices. This includes a local chain, and Wal-Mart and other big-volume stores. Those who really need to save go to Aldi, which cuts costs to the bone and offers no frills.

This local store never sold strictly on price. Instead, it emphasized customer service, variety, quality, with a friendly, solicitous staff of high-cost unionized employees. Customers were fond of the white-haired lady who served them at the check-out counter, or the deli worker who always smiled and remembered the customer’s name.

That doesn’t seem to be a business model that works anymore. Now there seems to be a lot more turnover, more temporary and part-time workers, and a lot of young employees in entry-level jobs.

In fairness, the produce manager does take it upon himself to help customers, offer suggestions, explain products. But overall, the “feel” of the store has changed, and staff morale does not seem to be very high. The store held a grand “re-opening” but failed to do much to reach out to its regular, loyal customers, even though the store reaps vast amounts of data from those customers about their purchases. With the discount card, it knows plenty about customers. To hold a “re-opening” that ignores loyal customers seems like bad business planning.

There’s a lot of pressure on business and individuals these days, with the recession, unemployment, flat wages, increasing costs and the loss of trillions of dollars in home equity, investments and pension and retirement funds.

Still, food prices are one of the few bright spots. As Agriculture Secretary Tom Vilsack points out, the low percentage of income Americans spend on food puts billions of extra dollars into their pockets. He also adds that this fact is little known or appreciated.

On a side issue, I note that this suburban supermarket is less than two minutes away from three elementary schools, with many hundreds of students. The government and schools are seeking ways to boost school lunch and school breakfast nutrition, with more fresh produce and better meal offerings.

More money is going to this effort, but one of the big drawbacks in the schools is lack of equipment, facilities, storage, transport, refrigeration and people for handling fresh produce. Often, the supply chain is fractured. These schools, thousands of them with 55 million students, sit minutes away from modern supermarkets that have perfected the handling and sale of hundreds of fresh fruits and vegetables. They do this daily, and at reasonable cost. Stores have what the schools need most: a predictable, consistent supply.

A number of supermarkets even have programs for locally grown produce. This fits nicely with a goal of the school lunches to “reconnect people with the food supply,” the basis of the U.S. Department of Agriculture’s “Know Your Farmer, Know Your Food” program.

Maybe some stores around the country do work with schools. Maybe the economics are unattractive to stores, although more money will be available when Congress passes the new child nutrition — school lunch — legislation, which it must do at some point.

I merely raise this as a discussion point about the relationship of food stores with schools.


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