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."

Giant's Warrington, PA store set to open this week

Giant plans to open a store at Doylestown Pointe Plaza in Warrington, PA this Friday, April 5, one day after it closes for business in nearby Jamison on Thursday, April 4.

The new location will feature a Beer & Wine Eatery and a full-service pharmacy, in addition to Giant's typical supermarket departments. The space was previously occupied by Redner's Market, which closed a year ago.

Redner's closing its Doylestown, PA store

Redner's Warehouse Market announced earlier this month that it plans to close its Doylestown Point Plaza store on March 31. Redner's currently operates 44 grocery stores and 21 Quick Shoppes in Pennsylvania, Maryland and Delaware.

"The lease on this location is approaching its end and the property owner presented us with an offer to end the lease early," said Redner's President and CEO Ryan Redner. "Based on the offer, non-renewal of said lease would prove to be the most beneficial direction to take for the company."

Doylestown Point Plaza is owned by Goodman Properties.

Wakefern members on list of Top 50 Small Chains

Supermarket News released its annual list of the Top 50 Small Chains and Independent Supermarkets. Listed at number two on the list (but actually tied for the top spot) was Inserra Supermarkets, a New Jersey-based Wakefern member that operates 22 stores under the ShopRite banner. Inserra has annual sales of $1.2 billion, according to the story that accompanied the list.

Also on the list:

#10 - Redner's Warehouse Markets
#35 - Brown's Super Stores (Wakefern/ShopRite - PA and NJ)
#37 - Perlmart (Wakefern/ShopRite - NJ)

Redner's succeeding by controlling costs

A Supermarket News story earlier this month reported that employee-owned Redner's Warehouse Markets is competing successfully with Walmart and others thanks to rigorous cost controls. The company's site selection strategy serves as a good example of these controls.

"We tend to go to smaller rural towns or the outskirts of urban areas just due to the negotiations and site selection that we use," said Redner's spokesperson Eric White. "We try to go to existing stores without having to build from the ground up."

Supervalu serves as Redner's supplier, but in effort to save money, the company buys direct and in bulk where it can. It also refrains from costly marketing, choosing instead to invest promotional dollars from manufacturers into the cost of goods.

Redner's tries to price its goods within 5% of Walmart on many items, and while Walmart has struggles in recent years with empty shelves, Redner's minimizes their out-of-stocks.

Although "warehouse" is still in the company name, in recent years the store has shifted to become 75% traditional supermarket and 25% warehouse.

"The bulk product that we were once able to offer isn't quite what the everyday consumer is looking for," according to White. "But consumers will come in and find that we're a traditional family-owned grocery store."

Redner's currently operates 44 Warehouse Market stores and 20 Quick Shoppes, and has an estimated $868 in annual sales.

Redner's Markets ranked 4th on national list of small grocery chains

Supermarket News released its annual list of the Top 50 Small Chains & Independents a couple weeks ago. Topping the list is PAQ, a California-based retailer that operates stores in Northern California and Hawaii. Lowe's Markets, based in Texas, was second, and California-based Northgate Gonzalez Market was third.

Redner's Markets was the top Philadelphia area company and was fourth on the list. Supermarket News ranks companies with annual revenues between $275 million and $1 billion by estimated sales volume for 2013.

The only other store from the Greater Philadelphia Market that made the list was Brown's Super Stores (ShopRite owner/operator). They were ranked number 29.

Click here for the complete list. (A subscription to Supermarket News may be required.)

Bottom Dollar has lowest prices in Philly region, according to study

According to a story on CBS Philly, researchers from the Delaware Valley Consumers' Checkbook visited supermarkets across the Philadelphia region to see which retailer had the lowest prices. The shoppers compared prices on 151 items, including fresh produce, fresh meat, national brand prepared foods and dairy products.

And the winner is... Bottom Dollar. The discount grocer's basket sold for $78, compared to the same basket at Whole Foods, which cost $134.

Walmart and Wegmans (yes, Wegmans) came in second and third place, respectively. According to Checkbook Executive Director Kevin Brasler, Bottom Dollar, Walmart and Wegmans offered significant grocery savings on a daily basis, as compared to other supermarkets that attract customers with sales.

"Big chains like Acme, Pathmark, Giant and ShopRite really pull customers in with sale prices," said Brasler, who also pointed out that prices on other items can be high and even vary from store to store.

The researchers determined that Giant, Food Lion, ShopRite, Redner's, Target and Weis all have prices that are lower than average. Pathmark and Super Fresh, both owned by A&P, had prices that were higher than average, and Whole Foods and Acme had the highest prices.

Aldi was mentioned as having "steep savings" but a limited selection.

Redner's 6th on list of small chains and independents

Last year The Fresh Market and Grocery Outlet were the top two grocers on Supermarket News' list of Top 50 Small Chains and Independents, but their growth has lifted them off the list and on to the Top 75 list of the largest food retailers and wholesalers in the U.S. and Canada. Last year Grocery Outlet, based in Berkeley, CA, purchased Amelia's, a chain based in Southeastern PA.

Redner's Markets, seventh on last year's list, moved up to sixth due to the addition of three stores. Brown's Super Stores, a ShopRite operator that's part of the Wakefern cooperative, is 35th on this year's list.

Fareway Stores (Boone, Iowa) operates 102 stores and tops the list, while PAQ, Inc. of Stockton, CA is second.

ShopRite, Giant tops again in Greater Philly sales

I received the highly anticipated Market Study issue of the Food Trade News last week.  As usual, there was an incredible amount of information about the supermarket industry in the PA, NJ and DE markets.

The headline was that ShopRite remains a strong leader (based on total sales) in the 55-county market area that stretches from Northern New Jersey to Central Pennsylvania to New Castle County, Delaware. Giant is a strong second, and Walmart has jumped into third. The new "big three" account for more than one third of the $49.5 billion retail food market.

In the eight-county Philadelphia market (Philadelphia, Bucks, Montgomery, Chester, Delaware, Burlington, Camden and Gloucester), ShopRite is slightly ahead of Giant, followed by three brands headed in the wrong direction: Acme, Super Fresh/Pathmark/A&P, and Genuardi's. The rest of the top 10 consists of Wegmans, Save-A-Lot, Whole Foods, Redner's Markets and Thriftway/Shop 'n Bag.

For more information than you can grasp in one sitting, check out the Market Study issue here: Food Trade News.

ShopRite, with $1.7 billion in sales, leads Philly market in 2011

Last Friday the Philadelphia Business Journal published the list of top companies in Philadelphia's eight-county area selling groceries, health- and beauty-care products, general merchandise and tobacco products, as compiled by the Food Trade News. Here's the list:

1. ShopRite - 43 stores with sales of $1.7 billion
2. Acme - 69; $1.57 billion
3. Giant - 47; $1.53 billion
4. Wawa - 280; $1.44 billion
5. Rite Aid - 252; $884.1 million
6. A&P (Super Fresh, Pathmark) - 40; $850.8 million
7. Wal-Mart - 37; $831.1
8. CVS - 187; $817 million
9. Genuardi's - 28; $733.7 million
10. Target - 29; $534.3 million
11. Walgreens - 90; $480.9 million
12. BJ's Wholesale Club - 12; $413.9 million
13. Wegmans - 6; $371 million
14. Save-A-Lot - 34; $258 million
15. Sam's Club - 7; $238.2 million
16. Thriftway / Shop n Bag - 21; $230.5 million
17. Redner's Warehouse Markets - 10; $222.7 million
18. KMart - 29; $210.9 million
19. 7-Eleven - 179; $201.3 million
20. Whole Foods - 8; $191.6 million

It's interesting to note that the three major drug stores had 529 stores in 2011. The 10 supermarkets totaled 276 stores (from Wegmans with 6 to Acme with 69).

Here's a link to the original compiler: Food Trade News

Redner's to add third store in Delaware

Redner's Markets, the employee-owned company that currently operates 40 Warehouse Markets and 16 Quick Shoppes in PA, DE and MD, has finalized plans for its third Delaware location. The new store will measure approximately 48,000 square feet and feature a self-service fuel station on the property. It will be located on DuPont Highway (Rt. 13) in Camden, DE.

Redner's Market to open in former Super Fresh space

Redner's Market has begun hiring for its new location at the Shops at Lionville Station in Chester Springs, PA, formerly the home of a Super Fresh supermarket. The new store is scheduled to open on November 2.

Although Redner's is known as a "no-frills" warehouse market, this new, full-service store will offer bakery, deli, seafood, produce and meat departments, along with frozen, dairy, health and beauty aids, and grocery departments.

According to its website, the employee-owned company currently has 39 warehouse markets throughout eastern Pennsylvania, Delaware and Maryland, as well as 13 Quick Shoppe convenience store locations.

Wegmans tops per store sales in Philly market, ShopRite and Giant also strong

I've written before about the wealth of information in the June issue of Food Trade News, which includes Publisher Jeff Metzger's annual Market Study. It's 100 pages of Elias Sports Bureau-type information; just substitute food retailers for professional sports leagues.

An interesting stat to me is sales per store. Much has been written in the last couple weeks about ShopRite overtaking Acme as the sales leader in the Philadelphia market (defined as Philadelphia, Montgomery, Bucks, Delaware, Chester, Camden, Gloucester and Burlington counties), but the overall sales leader is often a factor of how many stores each retailer has (although it should be mentioned that ShopRite has 26 fewer stores in the Philadelphia market than Acme does).

Sales per store is a telling stat. It's not surprising that Wegmans tops the list (for the period from April 1, 2010 to March 31, 2011). The stores are huge, and people routinely drive past other supermarkets to experience the superior customer service and selection. And at $62 million per store, no other food retailer is close.

It's also not surprising that ShopRite and Giant are next on the list. They are adding stores, gaining market share and succeeding, partly at the expense of Acme, A&P and Genuardi's (the "Big Three"). Average sales per store for ShopRite are close to $40 million, while Giant is just below $33 million.

The rest of the list is not so predictable. For instance, it's common knowledge that the "Big Three" have been struggling, but I wouldn't have guessed that A&P (Super Fresh, Pathmark & Food Basics) would be eighth in sales per store in the Philadelphia market. At $21.3 million per store, they are behind both Redner's Warehouse (seventh) and Whole Foods (fifth).

Here's the list:

1. Wegmans - $62 million per store (#6 in overall sales)
2. ShopRite - $39.5 million (#1)
3. Giant - $32.6 million (#3)
4. Genuardi's - $26.2 million (#5)
5. Whole Foods - $24 million (#10)
6. Acme Markets - $22.8 million (#2)
7. Redner's Warehouse - $22.3 million (#9)
8. A&P - $21.3 million (#4)
9. Thriftway / Shop 'N Bag - $11 million (#8)
10. Save-A-Lot - $7.6 million (#7)

ShopRite tops Acme for grocery sales leader in Philly market

I am anxiously awaiting the June issue of the Food Trade News and it's annual market study. Although I haven't received it yet, Maria Panaritis of the Philadelphia Inquirer obviously has.

According to Maria's story yesterday about the study, "ShopRite, ringing up $1.7 billion in sales across the eight-county Philadelphia region, grabbed the top spot from Acme, which has struggled to cut costs by shutting down underperforming stores and recently laid off 900 part-time employees."

Here are more market study results (thanks, Maria):

• Acme's sales dropped to $1.6 billion (from $1.8 billion in the previous 12-month period) for the period from April 1, 2010 through March 31, 2011.

Third - tenth place:

• Giant ($1.5 billion)
• A&P - Super Fresh / Pathmark ($851 million)
• Genuardi's ($734 million)
• Wegmans ($372 million)
• Save-A-Lot
• Thriftway / Shop 'n Bag
• Redner's
• Whole Foods ($192 million)

According to the study, ShopRite's ascent, along with the growth of Giant, Wegmans and Whole Foods, came at the expense of hundreds of millions of dollars that used to be spent at Acme. (Genuardi's, Super Fresh and Pathmark have closed stores and lost sales as well.)

Food Trade News - Market Study 2011

ShopRite Edges Acme in Philadelphia-area grocery sales, by Maria Panaritis