Adventures in Retailing Part XIV:
Ross M. Miller
Miller Risk Advisors
February 13, 2012
Brick-and-mortar retailing has been taking it on the
chin for years now. This series on retailing has pointed out the need for
the retail experience to be entertaining, but retailers (with the possible
exception of Apple) have not embraced entertainment, especially the kind
that required direct physical contact with customers, as part of their
marketing strategy. Despite the continued gloomy outlook for retailing,
one group of retailers, grocery stores, continue to expand their
footprint. I guess that even during a sustained global slowdown, people
have to eat.
Some of the expansion in the grocery segment is largely
hidden. The two big traditional retailers, Wal-Mart and Target, have been
increasing their grocery presence, usually taking existing stores and
expanding the shelf space for grocery offerings at the expense of other
retail items. The problem that I have found is that this expansion into
groceries makes these stores less desirable shopping environments because
they usually entail a complete (and poorly considered) overhaul of the
store. The local Target stores, all of which have added extensive grocery
sections tucked far in the back of the store, have become totally
different retail experiences. The area next to the check-out lanes that
used to be dedicated to what amounted to a convenience store now houses
aisle after aisle of pet food. The food section itself is spooky. All the
frozen and refrigerated foods are kept in enclosed refrigeration units.
The units only light when a customer is detected in their vicinity. This
means that as one walks down the aisle, lights distractingly light up one
after the other several feet ahead of the shopper. Green, yes; friendly,
The big news in retailing in my corner of Upstate New
York is the arrival of a single Trader Joes (coming next quarter) and a
flotilla of that fabled New Jersey grocery chain, ShopRite.
This month I will discuss the first of these ShopRite stores, which has
been open for several months now in my local town of Niskayuna.
I grew up in New Jersey, so I grew up with ShopRite. (I
actually spent my very early years in the Deep South with Elvis and such,
but all my memories of those days are limited to photographs.) Indeed, my
best friend's cousin from my Jersey days was head of Supermarkets General,
a renegade group of ShopRite stores that broke from the mothership to form
Pathmark. A&P was the dominant chain in Jersey at the time and
ShopRite survived as the low-price alternative. A&P was a bit on
the grimy side, but ShopRite bordered on filthy. It was notable for its
store-branded products; indeed, the cooperative that ShopRite stores
belong to is called Wakefern Foods. ShopRite soda used to cost something
like $1 for 15 12-oz cans in the days before the dollar cut it last ties to gold. ShopRite's big selling point was that it accepted coupons
without requiring the purchase of the underlying items. As an enterprising
young man, I managed to finance my various pastimes before I was employed
by the financial services industry by clipping coupons from
"recycled" periodicals. (Dumpster diving had yet to enter the
American lexicon, so garbage picking was the common phrase for this
By the time I hit high school, the bright, shiny
Pathmarks appeared to have buried them both. Bye, bye, ShopRite, see you
in some parallel universe. Or so I thought.
I don't visit the Niskayuna ShopRite because it's a
great store; both the Fresh Market and the Hannaford are much more
pleasant places to shop. I visit it because it is virtual New Jersey.
Clearly, a team from New Jersey set up the store and hired New Jersey-type
people to work there. The recorded PA announcers have New Jersey accents.
The music is Jersey Boys doo-wop mixed with similar tunes from the
pre-Beatles era. They prominently carry some distinctly New Jersey
products, like Tastykakes, flanken,
and every variety of kettle potato chips known to man. The shoppers even
look like there are from New Jersey. Hey, I'm from New Jersey, that's a
start. Those Union College gals look like they're from New Jersey. Hey,
isn't that blonde lady with all the make-up and the low-cut sundress (in
the middle of winter) one of Tony Soprano's goombas?
Now going to New Jersey is one of the last things on my
mind, but when the virtual New Jersey theme park is just a five-minute
drive away and its 10:35pm and I'm bored, it's worth a shot. (Oddly, the
store closes at midnight every night except Sunday, when it's 10pm, in a
part of the world where round-the-clock supermarkets are the standard; get
with the program, ShopRite!!!)
The ShopRite is plain weird. Some of the prices make me
feel like I've fallen into either the hyperinflation or Upper East Side
wormhole. Eight bucks for a small plastic colander that cost twelve cents
to make in China??????? The produce is good, much of it looks like the
same stuff as Fresh Market gets, but ShopRite is still miles from Whole
Foods (which itself is about 100 miles away in Hadley, Mass.) Produce
selection is impressive and sale prices are smokin'. Sadly, the ShopRite
has the bane of my existence: narrow aisles. Not only are they narrow, the
end caps overlap the aisles, making it harder to get in and out of the
aisles. The reason I like wide aisles is simple; in my mind I view grocery
shopping as a race against time. This could be because I grew up watching
Supermarket Sweep (and really digging it), but it is probably because I am
an economist by training and recognize that time is money. Narrow aisles
can increase shopping time substantially (or lead to injuries of the
people that I mow down).
The ShopRite is a big hit with the locals, apparently
even those who would not willingly set foot in New Jersey. I am concerned
that my local favorite, Hannaford, will be its ultimate victim. The local
Hannaford has never been particularly busy. Longtime locals seem to dig
Price Chopper. I even dug it when I came to the area 23 years ago, but
when they remodeling the stores and narrowed the aisles, I took my
business to Hannaford and never looked back. I have my priorities.
Next time, it's back to television. Really back.
Copyright 2012 by Miller Risk Advisors. Permission granted to
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