Northgate Gonzalez Market to promote produce to SNAP participants


Northgate Gonzalez Market said Thursday it will offer programs through its produce departments to promote long-term health among low-income shoppers as part of a program with the Center for Community Health at the University of California, San Diego.

The Anaheim, Calif.-based retailer said it will offer financial-incentive rebates on fruit and vegetable purchases using the chain’s customer loyalty card, as well as special produce promotions, in-store cooking classes, store tours and education on food labeling, to encourage additional purchases for healthy food options.

The retailer also said it will share data with researchers at UC San Diego, including per capita spending and changes among SNAP participants, as they gain more knowledge about healthier food options.

The program evolved from a $3.4-million grant the university received from the U.S. Department of Agriculture to increase affordable food access to low-income shoppers who receive benefits through the Supplemental Nutrition Assistance Program.

“We are honored to work with UC San Diego to support the USDA in the development, implementation and evaluation of a nutrition incentive program,” said Victor Gonzalez, co-owner and VP of Northgate. “It is our goal to develop an effective, efficient and replicable financial-incentive rebate system that can serve as a national model for retailers and contribute to the enhanced health and well-being of low-income community members.”

The chain operates 40 Hispanic-focused stores throughout Southern California.

Similar incentives for SNAP participants have been piloted at Kroger, Balls Food Stores and SpartanNash.

Publix opens in Winston-Salem, N.C.


More to come

Earlier this month, Publix Super Markets opened a 53,000-square-foot store in Winston-Salem, N.C., its first in the city.

“We are excited to begin serving customers in Winston-Salem and providing premier service, quality products and value — including a large selection of buy-one get-one free deals weekly,” Kim Reynolds, media and community relations manager for the retailer’s Charlotte, N.C., division, said in a press release. “Additionally, we are looking forward to being an active and present partner in the community.”

The Lakeland, Fla.-based retailer currently has 18 stores in its Charlotte, N.C., division with another 20 slated to open in 2016, 2017 and beyond, according to its website.

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Whole Foods opens ‘streamlined’ 365 store.


Whole Foods Market unveiled its new 365 concept today at a store in the Silver Lake section of Los Angeles — the company’s effort “to streamline the shopping process with a blend of innovation and convenience,” it said.

“We’ve built a foundation on the quality standards you’ve come to expect from Whole Foods Market in a fun, new format that’s easy to navigate and focused on value in every department,” Jeff Turnas, president of 365 by Whole Foods Market, said.

The 28,000-square-foot store is located in a former Ralphs location in Silver Lake, an area a few miles west of downtown Los Angeles with a youth-oriented, culturally diverse population.

According to Whole Foods, part of the store’s streamlined approach involves using all digital price tags, with limited printed signs.

In place of the labor-intensive service departments at conventional Whole Foods stores, the 365 in Silver Lake offers a large selection of grab-and-go prepared foods, with a heavy focus on vegan options; eclectic offerings like bibimbap, a Korean rice dish, schichimi togorash, an Asian-inspired spiced brussels sprouts dish, and chicken verde enchiladas; and soups like West African peanut and Tankatsu chicken and vegetable.

The store’s 5,000-square-foot “veg” section includes a curated assortment of fresh produce, with an area for chilled items, called “veg valley,” with many items sold by the piece rather than by the pound and with customers asked to weigh the merchandise themselves and apply stickers.

The store also features floral items at two price points — $5 and $10, the company said.

The “meat & sea” section offers approximately 30 ready-to-cook pre-packed chicken, meat, pork, seafood and marinated items, while the “total pantry” has everyday grocery items, including a bulk foods section and 124 feet of frozen foods.365 also carries a curated collection of more than 400 wines, with most items priced at or below $20; a smartphone app that allows customers to scan wine labels for instant descriptions and ratings; and 32 feet of chilled beer.

Across the front of the store is an area for “friends of 365,” featuring a craft brew bar from Allegro Coffee that offers cold brew coffee, wine, beers on tap, loose-leaf tea blends and a selection of pastries and savory items, with an indoor/outdoor dining area with 65 seats; plus teaBOT, a self-serve kiosk allowing customers to create personalized blends of teas and herbal ingredients.

After Memorial Day the vegan restaurant By Chloe is scheduled to open with 38 seats and a communal dining counter.

The store’s décor includes walls accented with blues, red and yellows to denote “an energetic, fresh vibe that complements the light shades of green and blue in the brand’s logo,” the company pointed out.

Each 365 will have a signature piece of art that reflects the community, the company added. At the Sliver Lake store it’s a painting with the words, “Silver Kale” (a play on Silver Lake), which Whole Foods said “serves to inspire team members.”

Coinciding with the opening of 365 is the launch of My 365 Rewards, a digital loyalty program; “Gimme 10 Deals,” which offer 10% off products featured on end caps, and digital “Punch Buddy Cards” that offer buy-10/get-one-free on select items.

The store also features “flash finds” — new products, seasonal items or unique offerings available for a limited time.

Whole Foods plans stronger marketing effort.


Whole Foods expects to announce a broad-based marketing strategy later this year, Walter Robb, co-CEO, told investors Wednesday.

With increased promotions and deeper price investments in select categories already underway, Whole Foods plans to broaden its marketing program to extend awareness of its pricing effort, Robb said.

“We’ve got something up our sleeves but nothing to announce yet. We want to get some pieces in place, and then we will launch a more broad-based marketing strategy — something we’ll talk about in the fourth quarter.”

Price investments have resulted in increased frequency and basket size among core customers, Robb noted. However, there’s been some erosion among more occasional shoppers who come in at different frequencies and for different amounts, he said, “though a comeback will happen.”

As part of its marketing effort, Whole Foods plans to expand its affinity program — already in place in Philadelphia — to Dallas during the summer, after which it will roll the personalized rewards program out nationally “now that we’ll have actionable customer data on a national scale,” John Mackey, co-CEO, said.

He said he is optimistic the first three 365 by Whole Foods Market locations the company will open over the next five months will be accretive to earnings, ”but we’ve got to get them up to speed.”

The company expects to have a clearer idea of results by November, Mackey explained. “We ‘re expecting them to have very good returns on invested capital and to be very profitable for us. But we have to open them up and see actual results,” he noted.

BJ’s launches ‘pick up and pay’ program


BJ’s Wholesale Club said Wednesday it is launching a “pick up and pay” online shopping option at all of its 231 locations.

“We are offering our members total freedom of choice regarding how they shop at BJ’s,” Bari Harlam, EVP, marketing and membership, for the Westborough, Mass.-based company, said. “This new service combines the at-home convenience of online shopping, including guaranteed product availability and our affordable pricing, without the wait for shipping and delivery.”

To use the system, members can sign onto the company’s website and select items, which are then hand-picked by BJ’s employees and placed in a cart at the member services desk; members are notified by email when the order is ready, after which they can pick up and pay for their order. Orders placed before 1 p.m. will be available the same day, the company said.

The service will also be available to non-members, who can sign up for a free 90-day membership or accept a $40 membership offer through July 3, the company said.

Whole Foods shows bees’ impact on bakery.


As part of Whole Foods Market’s ongoing efforts to raise awareness about the importance of pollinators, the retailer removed bakery items that rely on pollinators from a store in Fremont, Calif.

According to Whole Foods, 97% of items in the bakery would disappear or be significantly altered if there were no pollinators. Pollinators are necessary to grow products like chocolate, coffee, almonds, berries, carrots and vanilla, as well as the alfalfa dairy farmers feed to cows.

Since 2012, Whole Foods and its suppliers have donated more than $547,000 to the Xerces Society, a nonprofit that promotes conservation of pollinators.

Whole Foods, based in Austin, Texas, also encouraged shoppers to purchase pollinator-friendly products such as those from Cascadian Farms, Blue Diamond or the retailer’s private label 365 Everyday Value.

“This campaign is all about inspiring people to take small steps that make a big difference for these small heroes of our food supply,” Lee Kane, mission and culture coach for Whole Foods Market, said in a press release. “Even simple strategies like shopping organic or planting native wildflowers can tip the balance back in favor of our pollinators.”

Walmart expanding grocery pickup


Wal-Mart Stores said Wednesday that it was launching its click-and-collect grocery shopping option in eight new markets, and expanding its availability in several places where it is already available.

The Bentonville, Ark.-based retailer said free pickup will launch this month in Kansas City, Mo.; Boise, Idaho; Richmond and Virginia Beach, Va.; Austin, Texas; Provo, Utah; Daphne, Ala.; and Charleston, S.C. Service is expanding in Dallas, Houston and Atlanta, where the retailer is doubling the number of stores where the service is available, according to Michael Bender, EVP and COO, Walmart Global e-commerce.

Walmart currently has online shopping available in 23 markets.

“Customers tell us they’re excited about online grocery because they’re putting the time they’re saving back into meaningful parts of their lives (like spending time helping their kids with homework or having a date-night with their spouse),” Bender said in a blog post. “They have the option of shopping whenever and wherever they want – adding to ongoing lists all week, or placing a quick order through our mobile app – putting them in control of the entire process, all the way down to when they pick up. Even better is that our grocery pickup service is 100% free to use. We offer the same everyday low prices found in our stores, and there are no hidden fees.”

Bender said that 90% of Walmart’s Grocery Pickup shoppers are repeat users, and more than 90% of online orders include fresh grocery items like dairy, produce or meat.

“That’s exciting because it means that our personal shoppers – associates who are carefully selected and highly trained to pick these foods as if they were choosing for their own families – must be working hard to get things right while strengthening the trust customers place in us to shop for them.”

Whole Foods details what’s in store for ‘365’


Whole Foods Markets on Thursday confirmed a May 25 opening date for its 365 small-store concept in Los Angeles, and detailed features including a self-service tea bar, a vegan fast-casual restaurant, on-line ordering through Instacart and custom created apparel for its workers.

The Austin, Texas-based retailer described 365 as a “quality-meets-value” interpretation of its traditional store with a curated product selection that adheres to the standards of its parent brand “in an environment that’s fun and convenient for shoppers.”

Whole Foods is opening its first 365 store in Los Angeles.

Whole Foods is opening its first 365 store on May 25 in Los Angeles.

The 30,000-square-foot store in the Silver Lake neighborhood of Los Angeles will host several “Friends of 365” through partnerships with the vegan fast-casual restaurant By Chloe, as well as Allegro Coffee Co. and teaBOT, a new retail platform that provides custom grab-and-go tea in under 30 seconds, the company said.

Friends of 365 is an opportunity for innovative businesses and entrepreneurs that align with the mission and quality standards of Whole Foods Market to establish their own independent retail spaces inside of 365 by Whole Foods Market stores.

Whole Foods has plans for at least 13 365 stores.

Allegro will expand its coffee experience with a craft brew bar, serving customers hot coffee, cold beer and a selection of food items. Toronto-based startup teaBOT will install an efficient self-serve kiosk, allowing customers to personalize tea by mixing up to three of 18 different teas and herbal ingredients. By Chloe will offer guests a diverse menu of plant-based foods, including burgers, salads, market specials, pastas and sweets, that can be enjoyed in the restaurant, taken to-go or to a communal dine-in experience elsewhere in the store, the company said.

“With each store, we’re looking to curate a unique experience. Allegro’s craft brew bar will provide a casual place for Silver Lake residents to relax before or after they shop, while teaBOT’s unique service will offer a quick, yet deeply personalized tea-making experience,” Jeff Turnas, president of 365 by Whole Foods Market, said in a statement. “We’ve really dedicated ourselves to partnering with like-minded companies that are doing new and interesting things in their respective field to bring a truly unique shopping experience that complements our thoughtfully curated selection of foods.”

The company said it will offer online ordering and delivery services through Instacart. It selected sustainable casual goods purveyor Loomstate to custom design team member apparel for its stores. Loomstate was chosen for its contemporary looks, sustainable practices and commitment to organic products, 365 said.

U.S. retailers better prepared for Aldi, Lidl threat: Report.


Aldi’s rapid expansion and Lidl’s pending U.S. arrival aren’t likely to have as devastating an effect on top U.S. grocers as they had for counterparts in Europe, but their invasion will likely prove especially problematic for smaller operators and those focused on lower-income shoppers, an analyst said in a report Thursday.

And though their overall share of the U.S. market is not especially significant today, both Aldi and Lidl have demonstrated the ability to improve their offering as they grow, representing a threat over the longer term to a wide range of retailers.

“All retailers need to treat Aldi (and at a later date Lidl) as a meaningful threat — and to be dismissive will likely prove to be a tactical/strategic error,” the report, authored by Deutsche Bank retailing analyst Karen Short and colleagues, said. “All retailers — irrespective of income demographics — need to keep an eye on Aldi’s evolution, particularly given the success they have had in the U.K.”

The report argues that top U.S. grocers like Kroger and H-E-B are better prepared than European conventional supermarkets to withstand price-focused competition, having already adjusted to a significant threat from Wal-Mart Stores in part by becoming more competitive on price themselves and adjusting to operating under narrower margins.

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The “Big 4” grocers in the United Kingdom, by contrast, were caught raising prices when Aldi and Lidl attacked, and the market’s relative dearth of smaller competitors left them more vulnerable than a fragmented U.S. market would, the report noted.

Those players — Tesco, Morrisons, Sainsbury’s and Asda — have all seen their market share and margins drop significantly, while Aldi and Lidl have grown store counts by around 7% annually since 2004, and today control around 8.3% of the U.K. between them. That share has come almost entirely from the “Big 4,” which have seen combined market share decline from nearly 70% in 2011 to 64.2% today, the report said, citing internal research and Kantar Retail figures.

Both Aldi and Lidl are German-owned, limited assortment discounters with similarly efficient structures enabling them to offer significant price advantages, primarily on private brands. Aldi has operated in the U.S. since 1976 but is in the midst of a plan to build 500 new stores before 2019. Lidl has said it would enter the U.S. no later than 2018 with sources expecting as many as 100 stores in the Mid-Atlantic states.

According to the report, smaller food retailers with low market shares are likely to be most vulnerable to the discount competition — a threat that could trigger additional consolidation among food retailers seeking to boost share.

“We think smaller, weaker conventional grocery chains are very vulnerable to Aldi’s and Lidl’s expansion,” Short wrote. “The most at-risk would be the grocers that lack scale and do not have leading local market shares (i.e., outside the top 4 in any market). So at the end of the day, the rise of the hard discounter will ultimately accelerate consolidation in the U.S. in our view.”

In the near term, stores servicing the most price-sensitive customers are most at risk, Short added, citing Aldi’s leading pricing in proprietary market studies in New Jersey and Nashville. In Nashville, Supervalu’s Save-A-Lot chain was closest on price to Aldi — and scored better in meat, a key traffic driver — but “we believe that [Save-A-Lot] may also be the most exposed to Aldi’s expansion given the demographic overlap – both grocers target value-focused consumers who shop for low-priced private label products in a smaller box format.”

A 2015 study of 12 U.S. markets where Aldi operates stores by consultant Oliver Wyman cited in the report, noted that more than half of Walmart Neighborhood Market shoppers also shopped occasionally at Aldi. Hy-Vee and Save-A-Lot shoppers were in the mid-40% range. Stores with more appeal to higher-income shoppers including Whole Foods (15% of primary shoppers also Aldi shoppers) Wegmans (12%) and BJ’s Wholesale Club (10%) were least likely to have primary shoppers who also shopped at Aldi, the report added.

However, a track record of improving its offer as it grows could signal longer-term threats to a greater field of competitors, Short noted, citing Aldi’s expansion of natural and organic goods and expanded fresh offering.

Trader Joe’s widening price gap with Whole Foods: Analyst


Trader Joe’s appears to be widening its price advantage with rival Whole Foods Market, with indications that the Monrovia, Calif.-based retailer may have have ambushed Whole Foods with a fresh round of across-the-board price investments, an analyst said Tuesday.

Citing recent price checks in the New York market, Karen Short of Deutsche Bank Securities in a report said Trader Joe’s had a total price advantage of 26% over a neighboring Whole Foods Market across a basket of 77 like items — with Trader Joe’s prices cheaper on 60 of the 77 items checked. Prior price checks, Short said, had not indicated such disparity.

Short said the price check may have signaled that Trader Joe’s has proceeded with a round of price investments not unlike it had in 2013, when the retailer reached the 300-store mark and slashed its everyday prices on some 200 items. That event triggered a response from Whole Foods, which historically has priced its goods — particularly its private brands — within reach of of its privately held rival. Short said her research indicated Trader Joe’s would proceed with an additional round of investments when it reached the 500-store plateau — or about where it is now.

“With this in mind, we conducted a price check across all categories to see, if, in fact, a meaningful price gap existed,” the report said. “To our surprise it did, so our concern is that TJ’s might be once again catching WFM off guard because prior checks have not shown such disparity.”

The price study indicated Trader Joe’s prices were 30% cheaper on perishables and 24% cheaper on non-perishables, Short said.

Significantly, Trader Joe’s had an 15% advantage in overall pricing vs. Whole Foods’ 365 private-label goods.

“The wide price delta between TJ’s private label products and WFM’s ‘365’ private brand … was a surprise to us given that the ‘365’ brand strategy has generally been to match TJ’s on price in private label despite the fact that WFM’s private label is meaningfully higher in quality and therefore justifies a premium,” the report said. “In prior price checks, WFM’s private label has matched TJ’s item by item — until this most recent check.”