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Archive for Friday, April 30, 1993

GROCERS SAY CONSUMERS LOOKING FOR MORE SERVICES

April 30, 1993

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Faced with tougher competition and a shopper that wants to pay less for more convenience, Lawrence grocery stores are using inventories and services to carve out their share of the market pie.

``Lawrence is probably one of the most competitive cities in the country right now,'' said Alvin Joe Schmidtberger, owner of Alvin's IGA, 901 Iowa.

Schmidtberger said even smaller supermarkets like his -- Alvin's has 18,000 square feet, about half the size of most of his competitors' stores -- are doing more than just selling groceries.

``Basically a grocer is no longer a grocer but has got to become a feeder of the community,'' he said.

That means offering such things as a salad bar or ready-to-go salads, a deli and hot carry-out foods.

``With the husband and wife both working, it's hard to create a meal every night,'' he said.

KEN KEEFER, spokesman for Dillon Stores Inc. in Hutchinson, said the no-time-to-cook lifestyle is reflected in consumer demand for ready-to-microwave meals and other packaged foods that require little preparation.

``We add more and more frozen foods all the time,'' Keefer said.

Dillon's also tries to meet the needs of busy families by designing non-grocery services and merchandise into the three Dillon's stores in Lawrence. Those include pharmacies and floral departments, and at two of the stores, banking facilities. The Dillon's at 23rd and Naismith also has a dry cleaning outlet.

``Our emphasis continues to be to more and more services, conveniences, where we can offer that one-stop shopping experience,'' Keefer said.

Grocers who compete for that niche in the market will be joined in the spring of 1994 by Hy-Vee, a Chariton, Iowa-based company that has stores throughout the Midwest. Hy-Vee plans to build a 65,000-square-foot store at Clinton Parkway and Kasold Drive.

JIM LEWIS, owner of Checkers Foods, 2300 Iowa, said Hy-Vee will raise the stakes in the local grocery market.

Hy-Vee stores emphasize the services angle. In addition to more familiar services such as in-store pharmacies and retail banking facilities, Hy-Vee stores include sit-down restaurants, drive-up grocery loading services and veterinary consulting services.

``I see them positioning themselves in the market to draw customers away from the two big Dillon stores,'' Lewis said. ``They're full-blown service.''

The Hy-Vee store, which will open in spring 1994, will anchor a shopping center on the northwest corner of the Kasold and Clinton Parkway intersection.

Service also is a lure at the other end of the size spectrum. Maxine Kuker, who with her husband, Roger, owns Roger's Food Center, 608 N. Second, said their small, neighborhood market tries to compete with the large supermarkets by offering personalized service.

``WE TRY to do things that the larger stores can't do like knowing customers' names,'' she said.

Kuker said the store also carries specialized merchandise that customers can't get elsewhere, such as corn husks, chorizo and cactus for Mexican food. The store's full service meat counter also helps expand the little store's market, Kuker said.

``Our meat cutters get a lot of calls for unusual pieces of meat (that customers) can't get elsewhere, like tripe,'' she said.

Kuker noted that sometimes the store's small size works to its advantage.

``We have a lot of people who come across the bridge because they want to shop a small store, like the elderly who can't get around a large supermarket,'' she said.

LEWIS SAID that rather than chase the service-oriented market, his Checkers store markets itself to the price-conscious shopper. He said industry surveys show that in deciding where to buy groceries, shoppers value cleanliness first and price second.

Local grocers said they have seen consumers become more concerned about their health and the contents of food.

``In Lawrence, I still think there's a big emphasis on fresh food, your produce, but there's also a health consciousness,'' Lewis said, noting that the attitude is shared by shoppers of all ages, not just Kansas University students.

``They're really aware of the ingredients, they're reading the labels,'' he said.

Checkers caters to that market by carrying such items as buffalo meat, which is leaner and lower in calories than beef.

TWO NATURAL foods stores target the health-conscious segment of the grocery market more specifically. The Community Mercantile's grocery at 700 Maine and Wild Oats Market at 1040 Vt. both carry natural foods, organic produce, bulk foods and other merchandise that appeals to consumers who make health and environmental concerns a top priority.

Wild Oats, which belongs to a Boulder, Colo.-based chain, opened in January. In addition to the market, the store features a cafe and deli.

Zeke Cessna, the store's manager, said once a month Wild Oats has a ``5 Percent Day'' from which the company donates 5 percent of its sales to an environmental or human rights organization.

Community Mercantile is expanding its operation and plans to move into its new, larger location at 901 Miss. in August, said Jeff Helkenn, manager of the moving project. Helkenn said the larger quarters will allow the store, which is owned by a cooperative, to expand its inventory and also to provide more services.

``WE ARE going to try to cater to the needs of the neighborhood and be more of a one-stop shopping outlet,'' he said.

In addition to a broader inventory, the new store will sell prepared food for carry out or sit-down dining and offer a full-service meat counter. It also will offer more education through cooking demonstrations presented by a dietitian. Helkenn said the demonstrations will show people how to prepare natural and organic foods but also will provide general nutrition information.

``All kinds of dietary concerns are fair game,'' Helkenn said.

Other grocers also play to environmentally conscious consumers by offering some bulk foods and in-store recycling services. Keefer, the Dillon's spokesman, said his store will continue to accept certain recyclables even though consumer demand for environmental-type services has leveled off.

The volume of recyclables accepted by the company has stabilized and sales of ``green'' products, those that are made of recycled materials aren't increasing, he explained.

``You don't see as much emphasis on it, sadly, as you did two years ago when it was really at its peak,'' he said.

``By and large as a category that is not a high-growth area as far as customer demand,'' he said.

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