Tuesday, May 14, 2019

Redner's transforms store into Wegmans-like experience

An article in the Reading Eagle last month described how Redner's Markets, the Berks County-based grocery chain known for its no-frills, low-price, warehouse-style grocery stores, is changing its strategy in an attempt to gain customers.

According to reporter Jeff McGaw, the vibe in its Wyomissing, PA store "has become a little less 'canned goods for the big camping trip' and a little more 'brie and fresh grapes for Oscar night.'"

McGaw cites the sushi for sale, the salad bar, and a bar with four craft beer taps and two kombucha tea taps. There are nutritious, chef-inspired grab-and-go foods, large displays of organic and grass-fed meats, and a carving station that serves custom paninis.

The company, which began in 1970, experimented with a warehouse concept - a high-volume, low-margin approach with cement floors and wood palettes stacked with product - at a store in the mid-1980's.  Volume tripled, so the whole chain moved to that format.

Fast forward more than 30 years, and "times have changed," according to Redner's COO Gary M. Redner. "And if you're going to go head-to-head with Walmart solely on price, you're not going to win, so you have to have all these value-added items and make people want to come into the store."

Change for Redner's began last year, when the company hired Tim Twiford as its first executive chef. Redner's execs feel that Twiford was key to making the grocery chain competitive in the prepared foods arena.

Now, McGaw describes the Wyomissing experience as entering onto stylish wooden floors and seeing a colorful display of produce while smelling fresh baked goods from the nearby bakery. And it doesn't end there, as there are attractive displays throughout the store.

What about the rest of the chain's stores, of which there are 43?

"Rome wasn't built in a day," said Ryan Redner.

According to consultant Bob Kelley, the goal is to find the new customer without alienating the old customer.

"You go out and work hard in a certain market, learn from that, then you tweak it and roll it out," Kelley said. "Often times do baby steps and work things out that way."

Amazon Go store opens in NYC, accepts cash

The opening of the Amazon Go store last week in New York City represents the chain's 12th location, and the first to accept cash. The 1,300 square foot store is located in downtown Manhattan, across from One World Trade Center and on the second level of an upscale mall that includes shops, food vendors and restaurants.

Like other Amazon Go outlets, the store has no regular cashier. However, unlike the other 11 stores, customers may pay with cash upon request. Amazon Go is known for its "Just Walk Out" technology, where shoppers use the Amazon Go app to get into the store and automatically pay for the items they remove from the shelves.

Reports say that the cash option was added as Amazon has received criticism for discriminating against underbanked consumers who prefer to pay in cash. A number of cities, including Philadelphia, have enacted bans against cashless stores.

The new Manhattan store carries an assortment of grocery staples, plus ready-to-eat meals and snack options made by Amazon employees as well as local kitchens and bakeries. The store also sells Amazon Meal Kits, which the company said has all the ingredients necessary for making a meal for two in about 30 minutes. 

Amazon Go's other stores are in Seattle (four), Chicago (four) and San Francisco (three).

Sunday, May 12, 2019

Sprouts plans 13 more stores for the second half of the year

Sprouts Farmers Markets announced that it plans to open 13 stores in six states during the second half of 2019. Openings are slated for Virginia, Florida, California, Maryland, North Carolina and Arizona.

The company recently opened it's first Pennsylvania store in Philadelphia, and a store is scheduled to open on June 5 in Marlton, which will be Sprouts' first location in New Jersey.

Sprouts said it expects to have 340 stores in 22 states by the end of the year.

Giant opens six stores in four states

Giant Food Stores announced last month that it opened six new stores in four states. Five of the stores were Shop n' Save stores that Giant converted to Martin's Food Markets, and one was a newly constructed Giant to replace a closed store nearby.

Giant acquired the Shop n' Save locations from Supervalu last November and received approval to close the deal from the FTC in February. The stores are in Pennsylvania, Maryland, Virginia, and West Virginia (2). The Giant location is in Warrington, PA.

Giant, a wholly-owned subsidiary of Ahold Delhaize USA, now operates 178 supermarkets in Pennsylvania, Maryland, Virginia and West Virginia.

The company recently opened its first Giant Heirloom Market in Philadelphia, and has plans to open three more of the urban-format grocery stores in Philadelphia this year.

Walmart wins bid for liquor license in PA

Walmart submitted the top bid for a restaurant liquor license earlier this year for a store in South Union Township in southwestern Pennsylvania. It's the first liquor license in PA for Walmart, assuming the company files the required application and is awarded the license.

"We want Walmart customers in Fayette County to save money so they can live better," said a Walmart spokesperson, predictably.

According to Shawn Kelly from the Liquor Control Board, if Walmart is granted approval for the license, they will have to turn a portion of their store into a cafe that measures at least 400 square feet and has at least 30 chairs. Walmart would also be limited to selling 192 ounces of beer (approximately two six-packs) per transaction for off-premises consumption.

It is expected that Walmart will apply for a permit to sell up to three liters of wine per retail transaction.

Walmart isn't the first big box store in Pennsylvania to acquire a liquor license. A Target store in Plymouth Township (Montgomery County) has had a restaurant liquor license since last November. Several supermarkets and convenience stores - as well as movie theaters - already own liquor licenses in the state.

Monday, May 6, 2019

Amazon still dominant, but competitors gaining ground

Nielsen reported recently that Amazon's e-commerce lead is shrinking as major brick-and-mortar retailers like Target, Walmart and Kroger - along with e-grocery company Instacart - have outpaced Amazon in percentage growth of online consumer packaged good (CPG) purchases.

In the two-year period beginning in January 2017, the number of e-commerce buyers of grocery and other CPG products for Amazon rose 29%. However, the growth for Instacart (256%), Walmart (207%), Kroger (172%) and Target (122%) was far greater.

According to Nielsen, Amazon competitors gained ground in the last couple years by rapidly ramping up their online grocery fulfillment capabilities for home delivery and for store pickup.

Despite big gains by competitors, Amazon still enjoys a healthy lead. Its reach among U.S. online purchasers is approximately ten times more than any other retailer.

Lidl applies for $9.5 million in PA redevelopment grants

It was revealed last month that Lidl is seeking $9.5 million in Pennsylvania redevelopment grants for six stores, three of which are planned for Philadelphia - South Columbus Blvd. in South Philly, Butler Street in Port Richmond, and Roosevelt Blvd. in Northeast Philly.

The three other stores Lidl is seeking grants for are in Dover Borough (York County), Easton (Northampton County) and Ridley Township (Delaware County). The Ridley location opened last year and was Lidl's first store in the state.

In a story published on Philly.com, Lidl Spokesperson Will Harwood explained that Lidl often works with local government agencies and applies for available investment programs when they expand into new markets, including those that require remediation or rehabilitation.

The $9.5 million would come from Pennsylvania's Redevelopment Assistance Capital Program, which is designed to support redevelopment projects that officials deem capable of having a big economic impact. Six million would be for the three Philadelphia sites.