OKC-area discount grocery chains compete by selling delicaciesPublished: Tuesday, June 16, 2009 7:00 am By: Kelley Chambers
Even discount grocery stores need a strategy in tough economic times.
As many grocery shoppers are watching every dime, discount chains are ramping up efforts to keep shoppers coming through the doors.
Great deals on select items can get shoppers to the store, but once inside, prices on other goods must give shoppers a reason to keep shopping. Traditional discount stores are working to bring in new shoppers with improved delis and offerings like sushi.
Robert Pemberton, owner of Crescent Market in the Nichols Hills Plaza, said people need to eat and are looking for deals, leading shoppers to the discount chains.Pemberton, whose market isn't considered a discount store, said discount chains have a unique advantage when they can lure shoppers with bargains that other stores can't offer. "They'll sell stuff that's under cost, and nobody else can really match that price," he said. "They get them in the store that way, and then hope they can generate some other sales."
Discount stores continually must find what works best when competing with local and national markets. Steve Lawrence, general manager for Buy For Less, said the company works to set itself apart from competitors by offering special advertised items weekly, as well as some high-end offerings and specialty concepts.
Buy For Less has 12 stores around the metro area. It also has begun tapping new demographics with its Super Mercado brand stores catering to Hispanic shoppers. The Buy For Less at 3501 Northwest Expressway has been the testing ground for the company's Gourmet Grille and Sushi at the Grille, which may be expanded to some of the other stores. Lawrence said the response for sushi and items from the Grille have brought people there to eat who aren't there to shop for groceries.
Crest Foods, established in 1964, has six stores and is planning for a seventh to be completed by March 2010. Bruce Harroz, owner of the Crest chain, has been eyeing an area in south Oklahoma City for more than a decade. In 1997, he strayed from the idea and decided to build a store from the ground up in Edmond to serve the growing population. He has opened three more stores over 10 years in existing spaces around Oklahoma City.
With an increase in business during the down economic times and after exploring options around the metro, Harroz decided to build a store to cater to the growing population near SW 104th Street and May Avenue. Before investing in the area, Harroz knew the store would have to offer savings but also be upscale enough to draw people from the surrounding neighborhoods. Crest saves money by not advertising, but instead banks on its reputation for some of the lowest grocery costs in the city.
To entice shoppers to visit the new store, Harroz will equip it with a sushi bar and a wellness center. "During tough economic times, people cut back on the high-end restaurants and come back more to grocery stores to stretch their dollar," Harroz said. "And, of course, a lot of them are going to come to the cheapest place." The land, development and construction costs for the 95,000-square-foot store, which will be called Crest Market, will total more than $20 million.
Pemberton is not sure additions like sushi at grocery stores will necessarily bring in business to make those ventures profitable. He has chosen not to carry items like sushi because he said it is costlier and will not be as fresh as in a restaurant.
"Anybody that likes sushi knows it's best when it's fresh," he said. "If it's made at 8 a.m., it won't be as good hours later."
Harroz said he is focused on finding what will work best at the new Crest store when it opens and has no immediate plans for further expansion. "It will be some time before we make our next move," he said. "All of our money is in this." If successful, the store could be a model for Crest in its focus to offer traditional bargains with a bit of flair and added features like the company's first drive-thru pharmacy. "This is going to be more upscale than we've ever done," Harroz said.