By-the-box meats boost department sales to 29% of stores total.
He also found flaws in the way the store was being merchandised. It just didn't reflect the ethnic preferences of its black-dominated area according to Cates. "Chains tend to want all of their stores to be the same no matter where they're located," he says. "That just doesn't work in a lower-income area like this. What you display or advertise here can be entirely different from how you'd do it across town. If you don't know that, you can be in real trouble."
As soon as the takeover agreement was signed, Cates and his crew went to work to put the store back into selling shape. A thorough housecleaning, equipment repair, the addition of a decorative, functional overhang along the front, and a bright new Piggly Wiggly sign all helped give a new ready-for-business look to the store.
But then came the more complicated re-merchandising of the store. Valuable assistance in this effort came with the hiring of Bill Smith as store manager. With Smith's 14 years of instore experience at a nearby Winn-Dixie, Cates says that it was like hiring someone with a graduate degree in demographic merchandising.
The entire transformation process was completed and the new Piggly Wiggly was opened only seven days after A&P's closing. The immediate result was a sales gain as dramatic as the store's face lift. From A&P's weekly average in the $20,000 range, Cates' new Piggly Wiggly zommed to $80,000 in the opening week.
An outstanding contributor to this continuing sales performance is the store's meat department. In the re-merchandising process, selection has been upgraded to give customers a wider variety of cuts and types of meat and merchandising emphasis has been placed on area favorites: chicken parts, fresh fish, salt fat back, pork neckbones, pig's feet, and chitterlings. To encourage related-item impulse purchases, meat is frequently displayed in the produce department with such tie-ins as smoked ham hocks and hog jowls offered along side fresh greens.
One of the meat department's biggest boosts to sales originated at a meat seminar held for affiliated retailers at the Piggly Wiggly warehouse in Kinston, North Carolina. Attended by Cates, Store Manager Smith, and Meat Department Manager Billie Cates (no relation to the owner), they found plenty of usable ideas. But it was the last item on the program that really caught their interest--a demonstration of how to merchandise 10-lb. boxes of meat.
"We were looking for something new and different that could build volume . . . and we agreed that boxed meat just might work for us," Cates says. "We wanted to get started right away but the warehouse didn't have the boxes." Rather than delay the program, Cates contacted the box supplier in Altanta and bought boxes direct until the warehouse could supply them on a regular basis.
The boxes are shipped flat, ready to be assembled at the store. A high school student comes in each week to fold and staple enough boxes to cover expected volume. Sometimes the demand exceeds the box supply but when that happens, the store improvises. "In an emergency we have even used Miller beer cardboard flats," says Cates. "We make sure that they're clean of course. But all the meat is completely wrapped before being put in the boxes anyway. I don't know how Miller feels about that but it's free advertising for them."
Concerning the effect that these packaging costs have on the profitability of boxed meats, Cates says, "The boxes cost 20 cents each. But even with the part-time student, it's still cheaper than what it would cost to wrap all of this meat in individual packages. We average a 23% gross profit on the boxes beef, 25% on chicken, and 29% on pork."
All of the boxed meats are also available in the case in conventional-sized packages and in fmaily-size packs. To encourage purchases of the larger sizes, the family packs are priced 5 cents to 6 cents per pound lower than the smaller packages and the 10-lb. boxes are 10 cents per pound cheaper.
A typical meat case display of ready-to-go 10-lb. packs will include the choice of end cut pork chops (99 cents/lb.); fresh fryer leg quarters (39 cents/lb.); salt fresh back (39 cents/lb.); fresh fryer wings (69 cents/lb.); neck bones (49 cents/lb.); and pig's feet (49 cents/lb.). Turkey legs, another popular boxed item, is the only frozen product offered.
The Piggy Wiggly warehouse in Kinston doesn't offer a meat program so the store buys directly from various meat packers. "We have a good relationship with our meat suppliers," Cates says. "They're all familiar with our boxed meat program and keep on the lookout for any market surplus or special pricing that we can use. We get from five to six meat deliveries each week."
"We start off by offering boxed meats just once a month," Cates explains. "Then we went to every two weeks and now they're displayed in our meat case all the time. The boxed meats take up only four feet of our 48-foot meat display, but they contribute 20% of our total meat sales. We're now selling an average of between 500 and 600 boxes a week." During the week of Progressive Grocer's visit, the store's advertised chicken quarters alone had sold 600 boxes.
Because of the area's lower income level, the store's beef-selling potentials were not considered especially favorable. But that didn't stop the store from experimenting with a 25-lb. beef box offer that includes 10 pounds of boneless chuck roast and five pounds each of boneless stew beef, boneless chuck steak and ground beef. Priced a $39.25, the assortment offers shoppers a $19.50 savings versus the cost of buying these items in standard-sized packs.
The beef promotion was an immediate success with sales now averaging 30 boxes a week. "Ringing up an extra $1200 a week in what was considered a 'no beef' store isn't bad," says Store Manager Smith. "And what's more, that's all plus business. Our regular beef sales haven't been affected."
The boxed meats are promoted in a monthly handbill that Cates has hand-delivered to approximately 7000 homes in the area. This is augmented by newspaper ads which the store shares with another Piggly Wiggly located across town. Cates would like to use radio and TV as his chain competition does. But with only two Piggly Wiggly stores in Durham, he says, "We just don't have the financial clout to afford the advertising that larger independent groups or the chains can."
Perhaps just as powerful as ad dollars, though, is the store's image-building involvement with neighborhood affairs and special events. Some typical examples include: the meat department's contribution of free hot dogs to the area's summer camp program for children, participation in the offering of free turkeys to senior citizens during the holidays, and the store's help in organizing the community's salute to an outstanding local police officer.
Cates reports that, when he first saw the East Main store, he said, "It might not look like much now. But this can be a good little store . . . and a good money-maker!" With the hard work, imaginative merchandising and family-like teamwork of Cates and his employees, it appears that both prophesies have been realized.
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|Title Annotation:||supermarket meat departments|
|Author:||Dyer, Lee W.|
|Date:||Sep 1, 1984|
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