Build a home in grocery: the housewares category is getting a bit more notice from grocery retailers. Can it find its niche at supermarkets?

WHILE NOT NORMALLY FOUND ON GROCERY SHOPPING LISTS NEXT TO MILK, BABY FOOD AND TOMATO SAUCE, housewares products are nonetheless gaining a greater presence in the grocery channel, particularly as cross-merchandising opportunities heat up and retailers see the value of these high-margin items.

[ILLUSTRATION OMITTED]

While some retailers are still taking a wait-and-see approach, suppliers are excited about the opportunities with housewares in supermarkets. The convenience of picking up a spatula or a mixing bowl along with the ingredients for pancakes, for example, is unbeatable. "Everyone has to buy food," says Jim Wells, executive vice president, national sales manager for Garden City, N.Y.-based Lifetime Brands. "This creates a diverse and captured, to a certain extent, customer base with many different income levels."

Industry observers note that frequency of store visits doesn't hurt. "They may visit their supermarket more times in one week than they will visit a department store all year," Wells says. "When you combine these two things, it creates substantial opportunity for the food retailer."

Many suppliers stress that grocery retailers should make the most of the fact that their shoppers are focused on food and meal preparation, so they may be more likely to impulsively buy a cooking-related item. "This is the principle of one-stop-shopping," says Henry Nading, sales and marketing coordinator for Houston-based Chantal. "So we have discovered that the primary contributors to gourmet product sales in supermarkets are basic necessity, convenience and impulse buying."

FOCUS ON VALUE

Nading adds that higher-priced items do not move well in supermarkets. "People may be willing to spend a few extra dollars on a pan they need or a unique gift they see, but they are not willing to break the bank," he says.

Grocery consumers are looking for value, agrees Manny Gaunaurd, president of Doral, Fla.-based Imusa, which started in bodegas/Hispanic grocery stores about 25 years ago. "This is not a long-term purchase; they are not looking to have this cookware last two to three years, but for four to five months." As a result, price points for this channel are typically lower, says Joseph Hodorowicz, vice president of sales for Woodridge, Ill.-based Trudeau, and generally run $5 to $25 in the housewares category.

"There is also no doubt that there is strength in key price points under $19.99, and even stronger results at $9.99 and under," adds Kerry Cooper, vice president of sales and marketing for Oxford, Conn.-based Polder. "We find everyday-use products with a compelling impulse-drive feature do well, especially seasonally."

Of course, consumers shop a grocery housewares aisle a little differently than they would shop a housewares section at a department store. "Grocery shoppers tend to be less price sensitive and more brand loyal," says Lynn Leyman, senior brand manager for Pyrex at Rosemont, Ill.-based World Kitchen.

[ILLUSTRATION OMITTED]

"The purchase of Pyrex items in grocery is typically based on need--a shopper needs a square dish for the new peach cobbler recipe she plans to make, for example--so price is less of a factor for the consumer," she says. "She will buy what she needs to complete her recipe."

Pyrex products cover the gamut--from glass baking dishes to measuring cups and mixing bowls to glass storage dishes--and the retails range from $3.99 to $11.99.

COUNTING ON CONVENIENCE

So how can grocers grow the category? Most suppliers stress the convenience aspect. Trudeau has been at supermarkets for 15 years and targets the grocery channel with its Home Presence brand.

"Consumers are using supermarkets to answer both their home cooking and home entertaining needs," Hodorowicz says. "Consumers are now focused on favoring healthy foods and kitchen tools that are practical, affordable and functional, such as our Home Presence brand."

Industry insiders note that the grocery channel is also very flexible with its merchandise, which can help, particularly with seasonal products. "They're used to in-and-out promotions," Gaunaurd says. While other channels have to stick with modular plans or planagrams, supermarkets can change items day to day, bringing in new items, testing them and then taking them out when they don't work or expanding them if they do.

Retailers should also consider their food mix, including types and price points, when planning their housewares sections. These factors will reflect the demographics of the area. Some California supermarkets may have 100 varieties of chiles, for example. "You get the flair of the local market, which tends to have unique items," says Gaunaurd.

For Imusa, which targets the Hispanic market, such items as calderos, lemon/lime squeezers and tamale steamers will be strong sellers in certain areas of the country. A supermarket may bring in a 20-, 30-, or 50-quart pot from Imusa "because a specific market may ask for it," he says.

Retailers also demand that housewares products be easily stocked. The category has a nasty reputation for bulky packaging, one that has been partly addressed in recent years. "An important part of success [at supermarkets] is packaging goods for easy set up and quick exit," Cooper says. "The more you can tailor your display of goods to the specific retailer's environment and display practices, the more you can stand out and make the buyer's decision easier."

Though the supermarket channel is still a fairly small one at about 6% of Polder's overall business, it's a growing one. The company is producing more products that fit into the supermarket environment, and "it has also grown as a focus for us as other specialty retailers leave the marketplace."

[ILLUSTRATION OMITTED]

Having been working with grocery for more than 20 years, the supermarket channel has been one of Lifetime's fastest growing channels of distribution, Wells says. "Food retailers learned that in certain categories they have an opportunity to expand the depth of offerings on an everyday basis," he adds.

So instead of just carrying a "good" can opener, some grocery retailers have found success with a "good," "better," and "best" assortment. "The combination of the obvious relationship to food, strong growth and margin for the retailer and consistent performance have resulted in significant growth in our food prep categories in this channel."

Polder offers grocers displays that feature an "essentials" assortment, Cooper says. "This gives the retailer a good breadth of product." Other displays relate directly to the adjacent food items, such as Polder's Safe-Serve thermometers. "These are based on food safety in cooking more than the desire to cook to taste," he says. "Placed next to the meat section, they are compelling to consumers who are concerned about food-borne illness from the under cooking of foods."

And overall, catering to the specific demographic of the supermarket is important, Hodorowicz says. "At the end of the day it's all about delivering the right product first and at a competitive price point."