Outstanding merchandising, advertising or promotional accomplishment.
"The condition of these stores when we took them over was like Dante's Inferno applied to supermarkets," says Lee Schear, co-owner of Metro Markets, operator of five stores in Dayton, Ohio. Despite this, he has been able to build a healthy business from his shuttered Liberal Markets, thanks to a strong promotional thrust to publicize the stores, and an effective employee relations program.
A descendent of the family that started Liberal and built it into a major chain before it encountered financial difficulties, Schear saw the 1981 auction of Liberal sites as an unprecedented opportunity. "My background is in marketing, and there's no better way to explore your ability to market something than by running a supermarket," says Schear, who moved from California to Ohio to confront the challenge.
Schear bought three inner city stores because they were underpriced, yet still had potential, even though the units had equipment that was 30 years old. (He has added two additional stores since.) The independent incorporated each store separately, and allowed the manager to purchase equity. The manager is given total freedom to run the market as he sees fit. Managers are encouraged through contractual incentives to buy as much stock as quickly as possible. After managers become fully redeemed in one store, they can purchase equity in another unit. They, then, become supervisors.
Metro's department managers are treated as salaried management employees instead of hourly workers. To encourage the managers to complete their work duties within 40 hours, yet still provide compensation if they work beyond their allotted time, the company pays them half of what their standard hourly wage would be for all hours in excess of 40 per week.
Along with the equity and overtime programs, Metro offers a score of other programs geared to making employees feel like a part of the company. Metro publishes a quarterly newsletter, sends birthday and holiday cards to all employees, sponsors softball, baseball, bowling and track teams, and conducts a stress management workshop for all managers. It also holds two employee appreciation nights annually. On these nights, the stores are closed to the public and employees can buy whatever they want at a 20% discount.
While this myriad of programs excites Metro's employees, a never-ending string of promotions is used to stimulate customer interest. Says Schear, "We have run 107 distinct promotions since we opened three years ago. Our philosophy is to try anything that will bring energy and enthusiasm into our stores."
One of the more unusual promotions was a million dollar sweepstakes, tied in with a Crazy Days celebration. "The winner of our million dollar sweepstakes receives one dollar a year for one million years," jokes Schear. In December, Metro employees built the world's largest fruit basket, constructed in the back of a pickup truck. The fruit basket was auctioned for $7,800; the pickup truck was included for that price.
A Metro-sponsored event tied in with Dayton's Dairy Days last June milked more media attention than any other promotion. Cincinnati Bengal quarterback Ken Anderson, the mayor of Dayton, city commissioners, bank presidents and other high-profile Daytoners competed in an egg-throwing, an ice cream-stacking and a cow-milking contest. Forty-thousand people were attracted to the three-day event.
The Metro Apple Bob also attracted thousands. A fountain was filled with water and apples during the week before Halloween, with every apple having a number that represented a prize offered by a downtown merchant. Parents and children dived into the fountain to collect the apples.
Other promotions included a cattle auction in the store; a 5% discount to the unemployed during the month of May; a winter festival featuring a rib-making and a strutting contest; a Customer Club hotline that allows members to call and discover a low price special for Customer Club members only; and a scratch-and-sniff advertising campaign. Thanks to Metro Markets and its energetic young president, the inner city of Dayton may never be the same again.
Around the World
In an L.A. Super
Attracting 5,000 to 7,000 people a day, the Original 32nd Street Market in Los Angeles rings up more sales in one day than most grocery stores do in an entire week. The success of this 50,000-square-foot city supermarket, which boasts more than $600,000 in weekly business, is attributable to the buying and merchandising savvy of Morrie Notrica, a fast-moving independent.
"I have operated a grocery store in this neighborhood all of my life, and have spent 90% of that time talking to customers on the selling floor," says Notrica, 55. "This community has changed from Caucasian, to black, to Latin over the years, but by keeping up with what the people want, I have always been able to do a healthy business."
Located one block from the campus of the University of Southern California, the Original 32nd Street Market has always attracted a mixed clientele due to the ethnic diversity of the student population. This mixture of people from various back-grounds inspires Notrica to carry an unequalled selection of specialty products. As the grocer says, "We stock products that make people homesick."
"We have Japanese, Middle Eastern, Chinese, Philippine, Latin, Iranian, Italian and many other sections in our grocery aisles," Notrica remarks. "Right now, I'm putting in a Creole section."
The independent points out that these sections are not merely 4 feet of products on one shelf, but that they stretch for 16 to 40 floor feet and 5 to 6 horizontal feet.
"Most stores that cater to ethnic groups do not put in the effort that we do. Take our Latin section, for example. Puerto Ricans eat different products than Salvadorans, who eat different things than people from Venezuela. You cannot simply characterize a customer as a Latin, and assume that he eats beans and rice."
Notrica carries more than 20,000 grocery products in his super. But the vast selection extends well beyond the grocery aisles. Perishables are also merchandised with diverse ethnic groups in mind.
The meat department encompasses 65 feet of service case, alongside 48 feet of three-deck. A 12-foot fish section sits next to the meat lineup. Produce stretches along the entire east wall of the market, with many of the fruits and vegetables merchandised in shipping boxes, due to their speedy turnover.
Notrica has built his business with continually low prices on perishables products. He claims that he sells lettuce at 19 cents a head every day of the year, even when lettuce was priced at $22 a carton.
The independent has never sold a 10-pound bag of potatoes for more than 99 cents. He says, "We always have eggs and bread at prices that our competitors don't even think of beating. We lose money on some of our staple products, but we don't care, because we have enough other products in stock to make money on."
"We do a lot of extra things to give us an edge in our fight against the chains," says Tommy Thompson, co-owner of Thompson's IGA Foodliner in Mt. Sterling, Ky. Thompson's 18,750-square-footer battles the chains with an FTD floral department, a catering service that became so successful that it had to be moved out of the store, an on-premises post office, and promotions such as a hamburger-eating contest and a free cornbread and baked beans dinner for everybody in town.
According to Thompson, he has the only grocery store in Kentucky with an FTD-affiliated floral department. "People can come into our store and send a floral greeting to anybody, anywhere in the country," says the 38-year-old Vietnam veteran. "We also do wedding consultations, funeral wreaths, and anything else that a large floral shop can do." Floral accounts for 2% of sales at the store, which averages $110,000 in weekly volume. During the week
prior to Valentine's and Mother's Day, floral contributes $7,000 to sales.
Thompson's IGA Foodliner can also cater an entire wedding. Started as an adjunct of the deli, the catering service became so popular that it had to be moved to another site with more preparation space. The catering business operates in conjunction with Thompson's Bake Shoppe & Deli, a restaurant also owned by the Thompson family.
"We can cater anything from a bar-becue to a fancy sitdown dinner. We've served as few as 10 people, and as many as 2,000," Thompson says. The store recently catered the filming of a Chrysler commercial starring Ricardo Montalban. The supermarket provided tables, chairs, flowers, breakfast, lunch and dinner for the crew.
The caterer's skill is especially evident at Christmas and New Year's, when several affairs are catered daily. A typical selection of hors d'oeuvres includes country ham on biscuits, chicken livers wrapped in bacon, spinach pie, baklava and other elegant foods for nibbling. The catering business has done as much as $20,000 in weekly volume during the holidays.
In early January, the business caters one of its largest affairs. Thompson explains, "The grocery business can get slow after Christmas, so to keep our customers coming in, we serve a baked bean and cornbread dinner. We set up big tables in front of the store on a Friday night, and put out dozens of pots of baked beans and loaves of cornbread. As many as 2,000 people come for the free dinner."
Thompson's biggest promotion every year is the Beef Roundup. Last year, the IGA sponsored a hamburger eating contest, attracting 27 entrants and hundreds of spectators. The winner gobbled down 17 hamburgers in 15 minutes.
Another popular Beef Roundup event is the stolen cow search. "We buy the winning 4-H cow, then put it in a pen near the store. But somebody comes in overnight and replaces it with a mangy goat. We then offer a cash reward to whoever can find the cow, which is hidden on some farm outside of town," Thompson says.
These beef-oriented promotions help meat achieve 23% of sales year-round, even though the store serves the fourth poorest county in Kentucky. Thompson's IGA Foodliner has won the Beef Roundup contest in its Wetterau division for five of the past seven years.
To provide additional convenience for rural customers, Thompson installed a post office in the market. The postal unit is built into the courtesy counter, and offers all services available at the regular post office. There are even post office boxes.
"People come in to buy stamps or pick up mail, then decide to buy some coffee and a loaf of bread," says Thompson. "Although we do collect $35 a month in rent from the government, the reason we have the post office is to offer another service to our customers. It tells people that we are part of the community."
Smiles and Service Thwart
Super Stop & Shop
Confronted with the opening of a Super Stop & Shop within two miles of his 18,000-square-foot IGA in Warwick, R.I., Bill Sutton embarked on an intensive advertising and public relations program. His purpose was to demonstrate to consumers that he could do things that the Super Stop & Shop could not. Stressing red coat service, a free cup of coffee, a senior citizen's discount and other advantages, the 38-year-old Sutton was able to maintain his volume in the face of a competitor who probably takes in more than $400,000 a week.
"An independent supermarket is a reflection of the person who owns it," says Sutton. "Since you can't change your personality, you can't change the store just because a competitor is coming to town. But you can build on what you already have, and point out the good attributes of the store."
Sutton decided to focus on the service level, the friendly attitude of employees, and the quality of the perishables. Working with his wholesaler, Roger Williams Foods of Cumberland, R.I., the grocer developed a series of advertising supplements that he broke with six weeks before the grand opening. "We knew the Stop & Shop was coming, so we went all out to strengthen our position in the trade area," says Sutton.
The supplements, which ran in four newspapers that serve the communities surrounding Warwick, are adorned with the smiling face of Bill Sutton on almost every page. Shoppers can trade at Bill's Barbecue Pit, Bill's Butcher Block, Sutton's Fish Market, or any of the other departments. And they all receive "Red Carpet Treatment" and "'Red Coat Service."
The ad reads, "At Sutton's IGA you get the Red Carpet Treatment when you shop. Like, an extra hand when you need help getting your groceries to the car. A friendly smile during your busy day. A cheerful courtesy booth where we offer you extras. A quick checkout system that gets you through the register as fast as possible. A free cup of coffee. Red Carpet Service is the extra touch Sutton's IGA offers that makes our store the friendly, convenient place to shop.
"Look for the Red Coats...Our managers don't hide from customers. We're your friendly neighborhood store and we want to help you with your shopping needs. That's why our managers wear red coats. So you can spot them easily. Call us old-fashioned, but we still believe that a personal, friendly grocery market is a lot nicer to shop than anywhere else. So look for the red coats, and you'll receive red coat service."
The advertising is homespun, not slick. Yet while communicating a homey message, the ads also make a strong price impression. Brand names are stressed in response to Stop & Shop's strong private label program. The store's double coupon policy is proclaimed on almost every page. Says Sutton, "Some consumers prefer to shop in a small, friendly store, and will patronize that type of market as long as its prices are in line with the big stores."
The independent has set up a coffee bar directly in front of the courtesy counter, enabling customers to serve themselves, and to stand around and chat. The ads also say, "We love our seniors," and point out that senior citizens receive a 5% discount on their grocery bill every Tuesday. Recipes are included in the ads. These explain how to prepare Smoked French Pepper Steak, Creamy Bake for Cauliflower, Ham and Sweet Potatoes, and other dishes utilizing perishable products that are advertised.
The advertising and public relations program has enabled Sutton to maintain his weekly sales of $95,000, despite the new competitive threat, and the response it has elicited from other stores in the area. A smile has protected Sutton's turf from the invading corporate giant.
With a Smoker
"I get a lot of inspiration from the exploits and innovations of other independents," says Gordon Atterbury, owner of two Dee's Markets in Oregon.
When Atterbury's 15,000-square-foot unit in Roseburg was confronted with the opening of a 100,000-square-foot Fred Meyer in its trade area, the independent responded by installing a smoker in his store, and promoting the smoked meats through advertising and in-store sampling. He was able to maintain the store's weekly volume of $85,000 in the face of this fierce competition.
The grocer borrowed the smokehouse idea from a supermarket in Portland. He purchased a commercial smoker for $20,000 and installed it in his meat department. During December, the month after Meyer opened, he sold 4,000 pounds of smoked meat, boosting the distribution of his service meat department to more than 25% of total sales.
Dee's cures its own bacon and hams, as well as manufacturing several types of sausage, beef jerky and smoked turkey. Many products, such as English bacon, have developed a following. Smoked turkeys have been especially popular, and were ordered by many local businesses last year for Christmas gift-giving.
Atterbury decorated an old dairy case, and created a section called "The Smokehouse" adjacent to the service meat case. The Smokehouse and the multi-deck case filled with family packs are the only self-service sections in the entire meat department. All other meat is merchandised in a 56-foot service case that stocks more than 100 different cuts. Thick-cut steaks, stuffed Cornish hens, veal scallopini and other special cuts sit alongside ground beef and chicken legs in the service case. A 12-foot service fish case adjoins service meat, and offers about 15 types of fish daily.
The greatest excitement in seafood comes in March, when Dee's conducts a truckload fish sale. Atterbury explains, "We bring in three truckloads of fresh fish and park them in the lot. We put some old meat cases next to the truck, fill them with ice and pile fish on top of it." Last March, the outdoor fish sale moved two tons, or $5,000 worth, of salmon, sole, snapper, shrimp, oysters and other popular seafood items.
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|Title Annotation:||grocery trade|
|Date:||Mar 1, 1985|
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