Supermarkets in malls proving to be a win-win

Here in Greater Philadelphia, we are getting used to having supermarkets at the mall (Wegmans in Montgomeryville, Whole Foods in Plymouth Meeting, Sprouts coming to Moorestown...), but it's still a new concept in many parts of the county. Industry analysts believe we will see several more supermarkets lease space in malls in the coming years.

"With the fast-paced nature of America, shoppers want to be as efficient as possible when running errands," said Displaydata Marketing Director Paul Milner. "Grocery stores in malls could give Americans the benefit of a one-stop shop for all of their needs... This transition is another step towards providing shoppers with the advanced and friction-less shopping experience that the American consumer demands."

Milner also sees supermarkets in malls as a winning proposition for landlords. Mall owners, often stuck with a declining retail property, can transform their asset into a destination allowing consumers to complete all of their shopping in one place. He warns, though, that parking could be a deterrent if shoppers have to carry their groceries too far.

Whole Foods celebrates five years at Plymouth Meeting Mall

It's been five years since Whole Foods Market opened its 65,000 square foot store at the Plymouth Meeting Mall. Although Mall stallwarts Macy's and Boscov's are three times the size of the supermarket, the store's popularity make it a safe bet to refer to the mall as "Whole Foods - anchored."

Although I don't have sales numbers, it's well known that this Whole Foods location has been a great success. And since it opened, it has added the Cold Point Pub and Blue Route Taco Truck (on the roof!) to rave reviews.

According to marketing director Ashley Chaney, future enhancements include an expanded kids play area and more cooking classes and tastings.

Whole Foods to relocate from North Wales to Lower Gwynedd

Whole Foods announced today that it would close its North Wales, PA store and open a new, larger store in Lower Gwynedd, PA. The target date for the new store, to be located in Stoltz Real Estate Partners' Springhouse Village Shopping Center, is late 2015.

Whole Foods currently operates 379 stores but expects to reach 500 sometime in 2017. The company recently said it believes it could have as many as 1,200 stores before their growth is complete. Sales in 2013 were $13 billion.

Although many high-income suburban locations like Plymouth Meeting and Lower Gwynedd still warrant 45,000+ square foot stores, Whole Foods has been in the news recently for its inner-city and smaller format stores.

Historically the company selected locations with a large number of college students, but now they are fine with population density of any kind, regardless of the income levels. New stores in Detroit and New Orleans are supporting that theory, and Newark and inner-city Chicago are next.

Whole Foods is betting on a presence in less populated markets as well, but like their inner-city locations, they are often choosing to open smaller stores. In fact, they have reduced the average store size in recent years without slowing sales growth. According to Northcoast Research Analyst Chuck Cerankosky, sales per square foot at Whole Foods have increased as the store size has decreased.

"They made a very smart change in strategy," Cerankosky said. "The stores are a more productive size, and it brings their strongly branded, fresh-food focus to more markets."

As Scott Davis wrote in Forbes.com last week, Co-CEO Walter Robb wants the company to deliver on its "promise of becoming accessible to the masses, helping America get healthier and hopefully  integrating its purpose into the lives of those who never knew that Whole Foods was a brand for them."