A wee bit about grocery sales in the Washington-Baltimore market
Separately, only about 15% of consumers have bought groceries online.
-- "Poll: 84% of consumers never buy groceries online," Food Dive
(I've been thinking about it for Kikkoman reduced sodium soy sauce since my best and least expensive source moved from DC to Landover and it's inconvenient to get to by bike. But the prices are all over the place and not comparable to what I used to pay at V-Nine, a Thai-focused food wholesaler.)
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Giant Supermarket features products that utilize Old Bay (Chesapeake Bay style) seasoning spice.
1. Giant is the market leader in the DC-Baltimore region, with almost 28% market share, according to data published ("Ahold Delhaize flexes muscle in Baltimore/D.C.") by The Packer. This includes part of Virginia and Delaware.
According to Shelby Market Shares:
- Giant has a market share of 27.6%
- C&S Wholesale Grocers supplies 138 independent stores and a 14% retail market share
- Albertsons/Safeway had 126 stores and a 12.4% market share in March
- Walmart has 67 stores in the market and a retail share of 11.6%
- Supervalu has 184 owned or wholesale supplied stores and a 9.6% share
- Food Lion, owned by Ahold Delhaize, has 130 stores and a 6.1% market share
- Harris Teeter (Kroger) has 54 stores and a 5.8% share
- Wegmans has 14 stores and a 4.5% share in the market. ...Wegmans has two more stores under construction and at least four more planned
- Whole Foods has 22 stores and a 3.4% share of the market
- Weis Markets has 58 stores and a 3.1% share of the market
- Aldi has 56 stores and a 2% share
- SpartanNash supplies 11 stores with a 1.8% share
- Trader Joe’s has 19 stores and a 1.6% share
- Wakefern (Shoprite and Price Rite) has 18 stores and 1.6% share
- Save A Lot has 44 stores and a 1.1% share.
Giant is systematically upgrading the graphic design of its packaging for its various lines of private label products.2. Ahold Delhaize has been getting a lot of press in the trades, especially for their private label program ("Onward and Upward," Store Brands, July 2018), which has been significantly improved, and the Peapod delivery service ("Peeking inside the pod: A deep look inside Peapod's grocery delivery," Food Dive) which is a market leader and operates in many markets in which Ahold Delhaize doesn't have stores.
3. In 2012, I thought Giant was on the ropes ("Urban retail #4: how to prevent the coming failure of the DC region's Giant Supermarket chain") but they've come back. Many of the points I made they're addressing, and while prices have increased, they are still much less expensive than Safeway.
I still think they could do what Giant-Eagle (Market District) and H-E-B (Central Market) have done in creating an upscale store division, to better compete with specialty marketers like Whole Foods.
4. They haven't brought to the DC market their small urban format, bfresh, which operates in a couple walkable neighborhoods in Boston. It doesn't seem as if the merged Ahold Delhaize is going to continue to invest much in this format.
Whole Foods stores now feature a wide variety of price specials exclusive to members of Amazon Prime.5. Obviously, not just in DC but I am quite impressed with how Amazon is integrating Whole Foods, which they purchased last year, into the Amazon Prime ecosystem/business platform, offering huge discounts on various products only to Prime members.
It's another benefit in return for the membership fee, and is in line with what I expected them to do.
6. Unrelatedly, I was in an Aldi in Southern California, in a higher income section of Orange County and it was a sweet store.
Still barer bones compared to a traditional grocer, but more "upscale" compared to Aldi stores operating in lower income areas. My sense is that the company has room to expand in higher income markets. Most people are unfamiliar with the firm's discount reputation so it won't really hinder their entry..
7. RiteAid has mostly left the area, having sold off most of their stores in this region to Walgreens, but the proposed merger between that company and Albertson's, parent of Safeway, has been dropped.
It will be interesting to see what happens with Albertsons. Generally, the company is losing market share and the firm's private equity owner is looking to cash out.
They've opened an upscale store in Boise ("Albertsons new Broadway store offers exotic foods and a bar," Idaho Statesman), their headquarters town. Interestingly, the store was developed not by the Safeway division, but by the United Supermarkets division out of Texas, which has the upscale Market Street format ("New Albertsons stores on Broadway & in Meridian won’t be called Albertsons," BoiseDev) that I mentioned as a model in the 2012 blog post about Giant, but the store is now being branded as an Albertsons," after earlier plans to call it Market Street.
Ideally, the company could roll out this kind of thinking to more divisions.
Labels: commercial district revitalization planning, supermarkets-groceries
posted by Richard Layman @ 7:08 AM&Permanent Link
14 Comments:
1. Giant back in the 1990s did have a "Gourmet Giant" division.
2. The market for urban small scale stores has collapsed.
3. I'm surprised on the number of independents (Spartan-nash, C&S, Supervalu outside of Savers) in the area.
4. Supervalu is being bought out.
5. Not impressed with the Amazon-WF integration.
The instacart delivery has been a massive increase in car traffic and annoyance for other customers.
yes, your point about independents. But that would include the Hispanic markets, e.g., MegaMart has more than 10 stores itself, Bestway might have near that number--also in low income areas--are exceptions. The others tend to be one-offs these days.
I do disagree with you, a bit, about small urban stores. I would argue that none of the examples has been well executed. And the one offs like Glen's or Each Peach are way too specialized, too artisanal.
Tesco's Fresh & Easy was a massive failure. Seeing various groceries in Liverpool and London, I can't believe how much they blew it because Tesco, Sainsbury, Metro, Marks & Spencer, etc. all have small scale stores in walkable commercial districts.
The point is to do this in walkable places that are dense.
I don't think Ahold USA is the one to pull this off, unless they really let it be standalone, with some money behind it. Albert Heijn does these kinds of stores in the Netherlands and Germany (I saw one in Essen). I've never understood their failure to differentiate along these lines here.
It could be done on the lines of Peapod.
But then, it's not like it could be a super duper line of growth.
3. Plus, in downtown, I don't know. So many of the workers are suburban, and they aren't inclined to explore around the downtown. Mostly they walk to their office from the Metro and back, and only patronize places on that path.
Maybe if you could put one in at Metrocenter and Gallery Place and Farragut North/Farragut West, which are likely the highest used stations.
The Farragut West stop at International Square always intended this kind of use, but the food court isn't positioned on the path of the subway the way it would be in Liverpool Central or other stations with a well integrated food offer.
... I mentioned many times the Lidl in the Essen train station.
4. You've mentioned the Gourmet Giant before. Likely it was dropped when Ahold bought the rest of the company post-2000. It's like Albertsons. Companies firmly in the suburban mindset have a hard time with differentiated concepts.
Pre-Albertsons, to me the Safeway new urban format was better but still had a lot of misses (I did the WBJ piece which mentioned some).
5. I have seen the coverage about the Unfi acquisition. I always thought they were a natural foods focused firm (e.g., around here they serve the Senbeb food operation on 3rd St. NW and the Soupergirl wholesale soup production operation in Takoma Park).
You probably saw that quietly, Shoppers has sold some of their leases to Giant out in the distant suburbs, and Giant is moving to those locations because they are bigger than the comparable Giant location.
I am not very brand loyal. I shop based mostly on convenience. The bulk these days is Aldi, supplemented by Safeway, which while expensive is convenient, plus monthly runs to Trader Joes. I'm now walkable to a Target with grocery and buying a lot more there. Was in a Giant recently after a few years and they seemed to have upped their game, but it could have been a location-specific situation. I'll be shopping there more. I used to shop at Shoppers on occasion because they were strong on ethnic stuff and a few oddball things I like, but was in one recently and it was very disappointing. Produce was very depressing, and grocery items I expected were not present.
Lidl apparently has dialed back their expansion plans. Jurisdiction I used to work in had one planned but they requested an extension. Went in one in DE a few months back and it was ok. Slightly nicer than Aldi and the free-standing store design was more pleasant the most Aldis by far. I forgot to mention I shop at various NoVA ethic markets from time to time depending on what I need. H-mart, Grandmart, Fair Price in Alexandria. Great to have options.
Also, have yet to set foot in a Wegman's. I will eventually, but the though of the massiveness and choices gives me anxiety. I'm a get-in get-out kind of shopper, so such a store just doesn't appeal to me.
RE: urban small scale.
Sorry, wrong term. I agree with you, there is a market there. But the continued failure of everyone in that space keeps everyone away. Glen's closed the one in shay even though the rent was essentially free.
RE: UNFI They were until WFM got bought by amazon, and they now just want to be wholesalers. I thought Spartan-Nash would buy SVU but shows what I know.
Yes Lidl has dropped out despite the hype from a few years ago.
The urban format that has been working and expanding here is streets market.
Anon -- good comments, thanks. For us in the 'hood, we used to be able to get a bit of the Grand Mart type experience at the earlier iteration of the Florida Market district. Now all those stores are gone.
I've only been to the Wegman's in the vicinity of Springfield in Fairfax. It's huge. It's nice. But I don't think it's as amazing as all the trade and traditional press makes it out to be. It's nice to have the option.
For me, Safeway and Giant are equidistant from my house, but I don't merely shop at those stores, but at places while biking.
I agree with you about your take on Lidl. I saw one in Greater Richmond. I did think they assigned too much space to non-food soft goods. I liked their double end check out so one customer could bag their completed order while another one was at the checkout.
Ethnic wise, I do go to PanAm (now owned by Megamart) on 14th St. a reasonable amount (primarily for Malher type refried beans, limes and cilantro) and Megamart at NH Ave. and U Blvd. from time to time.
In Washingtonian's recent cover story on grocery stores I was shocked they didn't mention ethnic markets at all.
There was a great episode of Marcus Samuelsson's "No Passport Required" about Ethiopian restaurants and markets in the DC area and a couple of those markets looked awesome...
(It'd be great if he'd do parallel programs, on DC area Hispanic foods, but differentiating Mexican, El Salvadoran, and other South American cuisines and the Asian foods (Vietnamese, Chinese, Korean) especially out in Fairfax/Annandale.)
Charlie -- I think Streets is impressive. They opened one in Downtown Baltimore too, but I haven't seen it. I've suggested in Takoma area discussions that they be approached wrt a store at the Metro station, or on the street side of Walter Reed.
Didn't know that about Unfi. I guess their contract with WF is not likely to be renewed?
WRT SpartanNash, they are big but I don't think they've ever operated at the scale of Supervalu? I wonder if they were in the game for it?
An issue is what we might call "differentiated practice." Mostly, organizations are comfortable doing one thing only.
The problem with small convenience stores and grocery stores in the US is that they are expensive.
I happened to be able to check out the Arlington Streets branch and compared to the 14th St. store it's very small.
But the products at Streets on 14th, while a much wider selection, are expensive.
The challenge is how to get lower prices. I was struck in England by the fact that the smaller stores albeit well located still run by big companies had decent pricing. Yes Tesco or Sainsbury were more expensive than Aldi or Iceland (and Marks & Spencer more expensive than Tesco and Sainsbury) but the prices were in line, if not cheaper than Safeway and Giant and Harris-Teeter even so.
Similarly with CVS adding food, it's also very expensive. But I seem to recall the food at Pharmaprix (the Quebec version of Shoppers Drug Mart BEFORE they were acquired by Loblaws) being priced pretty decently.
So the challenge is how to get lower prices into this category of store. That's what I thought was the "killer app" potentially of bfresh.
E.g. I was in California and I was confused--I didn't go in but I saw a Foods 4 Less store. But I was looking for a Ralphs, because I saw a Ralphs truck in the loading dock and I came to the shopping center from behind, after having seen the truck.
Both are Kroger owned, and obviously in California, they might have a shared supply chain, based on seeing the Ralphs truck.
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In Anne Arundel and soon Baltimore County there are some "Green Valley" supermarkets. They are owned by the Green family, which owned a wholesaler in Baltimore, B.F. Green, which was subsequently sold to Richfood.
They still own one or two cash and carry stores in Baltimore.
I want somehow to sit down with them and talk to them about some of these issues.
Urban "natural foods" concept, Basics, coming to Portland.
https://www.fooddive.com/news/grocery--pacific-foods-founder-gets-back-to-basics-with-grocery-venture/529918/
8/18/2018
Don't have a cite for this, so could be wrong, but I think CVS signed a deal with one of the larger wholesalers on food, which is one reason it has improved in recent years (think 5 years).
Agree with prices. Prepared food can be cheaper in the smaller stores but then you get constant health code violations. This is not new -- bodega problem in NYC where they overcharge.
I noticed District Hardware at the Wharf has a cafe now as well to capture that revenue steam.
Honestly if you consolidate beer sales, coffee, sandwiches and dry cleaning you could consolidate about 3/4 of retail in the district. Oh and package pickup.
Maybe not coffee since people treat it like a cheap we work.
bike + beer is a thing in a bunch of places. I am idly working on a concept because my next door neighbor is now into home brewing and is a great griller as well (he's Brazilian)…
wrt dry cleaning, package pick up, and some basic hardware, I've thought city grocery stores might want to add those elements too.
But yes, in the core, such a concept should work.
wrt your point about prepared food, yes. I was surprised at some convenience store off Exhibition Road right at the South Kensington station that they still had reasonably priced "fresh" sandwiches. I can't remember if they had straight up fresh food though.
It is, as you say, about the supply chain, and it's hard to make it be cheap (cf. all those people trying to do fresh meal delivery). Obviously, Chipotle proves it can be very very very hard to do right, consistently.
CVS, I can't remember, might be supplied in part by McLane, which is a big co., they supply 7-11, among others.
re: package pickup
7-11's around Alex. have Amazon Lockers, as does Safeway and other places. Do they have these in the District yet? I have a condo front desk, so getting packages isn't a problem, but sometimes I use Locker because its on my commute route and often quicker than picking up at the front desk. Only complaint is the lockers often have empty boxes and junk piled in front of them. I've long thought WMATA should have long ago gotten into the package game (even as an in-city courier service) but for security reasons after 9-11 that is probably a no-go. All the space where the newspaper machines used to reside.
Streets is opening a 20000 s.f. store in a new development in Eastern Baltimore, Greektown.
https://www.bizjournals.com/baltimore/news/2018/08/22/streets-market-yard-56-pemco-southeast-baltimore.html
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