MERCHANDISING AND STRATEGY CHANGES
A glance at retailers that are restrategizing
Posted June 2003
Albertson's, which first offered grocery delivery in 1999, is now a presence in 100 ZIP codes throughout the Puget Sound region. The company has found a way to make its home delivery service profitable using its existing stores rather than building warehouses or distribution centers and keeping a fee in place to cover the time it takes an employee to package online orders. At Albertson's, home delivery costs $9.95 or $4.95 if a customer wants to stop by the store and pick up preordered groceries. Also, because SavOn Drugs is an Albertson's subsidiary, shoppers can have their prescriptions delivered with their groceries. The success of its grocery delivery program in Seattle — its test market — has allowed Albertson's to expand into Las Vegas as well as three Los Angeles counties, Portland, San Francisco and Vancouver, WA earlier this year.
Best Buy announced plans to open about 80 – 85 superstores throughout fiscal year 2004. Roughly 60 of those locations will be new domestic Best Buy stores, and nearly half will be in the chain's 45,000-square-foot floor plan while the other half will have a smaller market format. By the time these new stores are open, Best Buy will operate 546 stores nationwide and eight in Canada, as well as 104 Future Shop stores, 19 Magnolia Hi-Fi stores, 76 Media Play stores, approximately 740 Sam Goody stores and 387 Suncoast stores.
Brown & Haley, Inc. has created five new ways to sweeten your tooth. Its new variations on the Almond Roca candy, which traditionally accounts for about half of the company's revenues, offer customers a variety of alternatives. Roca re-builds include: a sugar-free Almond Roca; a version with chunks of espresso bean at the center (Mocha Roca) that's covered with cashews; a Soft-and-Chewy version; Almond Roca Seashells, which substitutes almond roca paste for the hazelnut paste usually found in the candy's center; and Roca Nuts, which are based on a roasted almond and covered with a layer of chocolate that has bits of roca center in it. According to Brown & Haley, these new products have helped the local company expand faster than the industry standard of two to three percent growth per year.
Gap added its maternity clothing line to twelve of its existing stores, including one in Seattle. GapMaternity had previously been sold exclusively through the retailer's Web site, but now moms-to-be in several cities have a brick-and-mortar shopping option.
Seattle Pacific Industries Inc., which owns the Reunion, Sergio Valente and Unionbay brands, entered the male shoe market with a licensing deal allowing Steven Madden Ltd. to label a new line of men's and boys' shoes with the Unionbay logo. The new shoe line, which will complement Unionbay's denim-based sportswear collections, should hit stores in time for back-to-school shopping this fall. The shoes will be sold through Steve Madden retail stores, department stores, apparel and footwear specialty stores and online. The company has a similar licensing arrangement with Vida shoes International, which produces junior women's shoes under the Unionbay label.
The Bon Marche remodeled its Bellevue and Southcenter stores, kicking off a company-wide effort to further enhance the customer's in-store experience. Shoppers will notice new signage, widened aisles, larger spaces between racks and directional signs at aisle intersections. Additionally, the store is introducing small shopping carts and fewer, more centralized checkout stands. The updated Juniors department features a half-circular couch, plasma-screen TV's, vending machines and Internet access for shoppers interested in checking their e-mail. In Children's clothing, TV's play cartoons and shoes have been added to the available merchandise. Other new merchandise includes a pet gift department and an increased commitment to the company's private-label brands.
Wal-Mart began testing in-store financial services — check-cashing and check-ordering — at select locations. The pilot stores serve as a litmus test for the chain, which announced its intention to move into the financial services business last year.