|Grocery wars: Battle for customers intensifies as more options hit market|
|by Jennifer Lade Bulletin correspondent|
Families looking for a loaf of bread or gallon of milk could surely find it at their local grocery store. But, these days, they could also visit a convenience store, drugstore or discount retailer's grocery section for the same items.
Across New England, the new normal for food purchases has shifted to a fractionalized marketplace in which consumers shop not only grocery stores but a variety of other places for their household staples. The changes have meant supermarkets must work harder to keep customers coming to them on a regular basis, competing with many more retailers than they would have a few decades ago.
Market Basket: Opened in New Bedford in 2010. Additional stores are planned for Bourne, Brockton and West Bridgewater;
Trucchi's: "Actively expanding" with five existing stores and a new store underway in Middleboro;
Wal-Mart: Recent announcement made that new supercenter is coming to Fall River with supercenter upgrades at varying planning stages in Seekonk, Swansea, and Wareham;
Wegmans: New to New England with big plans for growth. First store to open Oct. 16 in Northborough. Plans for additional stores in Westwood and Burlington.
"You didn't use to have a BJs or a Costco . . . or a Wal-Mart or a Target to carry groceries. The world was simpler," said John Rand, senior vice president of Retail Insights at Kantar Retail, a market analysis company.
Rand said the grocery chains that see the most growth are those that have a clearly-defined brand. Across SouthCoast, several successful grocery store chains are proving that consumers are receptive to a variety of store personas, as long as their message is clear.
A Wegmans opening in Northborough has found a different niche than the Trucchi's that is replacing the Stop & Shop on Route 28 in Middleboro, for example.
Meanwhile, Market Basket is flourishing, with a new location in New Bedford and stores planned for Bourne, Brockton and West Bridgewater.
"It's a conscious decision on the part of most retailers as to what kind of audience they most want to appeal to," Rand said.
For Market Basket, the success of its New Bedford location at Riverfront Landing paints a picture of a store that is perfectly matched to its location.
Officials from Market Basket, owned by the Demoulas family, declined to comment, but Mark Dickinson, founder of Dickinson Development Corporation, the developer of the site, said the store has been "hugely successful" since its October 2010 opening. The chain, which has a reputation as a price-competitive store, appeals to the mostly blue-collar residents in the immediate vicinity, though anecdotally, people have been traveling from as far away as Wareham and the Cape to shop there.
Market Basket also took advantage of a location that has 25,000 people within a one-mile radius and no competition to speak of: the next closest grocery store is more than a mile away.
Market Basket has 66 stores throughout Massachusetts and New Hampshire, including a site in Raynham. Its relatively small size makes it able to take risks that bigger chains can't manage, Dickinson said.
"They're quite entrepreneurial," he said.
A Market Basket store is slated to open by Memorial Day 2012 in Bourne, according to the Cape Cod Chamber of Commerce. The grocery store will be part of a 101,600-square-foot shopping center, which will house six to seven additional stores. The chain also announced plans to build a store in Brockton and the Patriot Ledger reported there are plans for a Market Basket in West Bridgewater as well.
A newcomer to the market, anyone familiar with Wegmans knows it is a completely different shopping experience than Market Basket.
The New York-based chain's first New England location will open in Northborough on Oct. 16, with a combination of restaurant-style offerings and competitively priced products. Moving to New England — sites are also planned for Westwood and Burlington — gave Wegmans "the opportunity to offer a shopping experience that didn't already exist in the market," said Bill Congdon, vice president and New England Division manager of Wegmans Food Markets, Inc.
"We offer a unique combination of incredible customer service, help with meals, restaurant-quality prepared foods, and consistent low prices."
The model has been successful; sales increased from $2.92 billion in 2001 to $5.6 billion in 2010. In 2001, the chain had 62 stores; by the end of the year, there will be 79.
Trucchi's announced in May it is opening its sixth store in Middleboro, gutting the Stop & Shop that closed at the location on Route 28. According to President Jim Trucchi, the plans for the new 45,000 square foot store are currently being drawn. Once in operation, the store could employ 100 to 150 people.
The family-owned Trucchi's — which has two stores in Taunton and one each in Abington, New Bedford and West Bridgewater — has its own warehouse facility, which is unusual for a company of its size, and which gives them a price advantage over other smaller chains. Still, their brand is one of clean stores and familiarity.
"We like to tout ourselves as the hometown store," Trucchi said.
"We're just going to create that hometown feel for the town of Middleboro. They deserve it."
Though he declined to give specific sales figures, Trucchi the company is actively expanding its reach.
"My mantra is, one more store, always one more."
The closing of the Stop & Shop made Trucchi's expansion possible and was a reminder that with winners in the grocery game, there are those that are losing ground as well. Rand said that despite the closing, Stop & Shop still has the biggest hold on the regional market. Eight stores are located within 15 miles of New Bedford, according to the company's Web site.
One struggling chain is Shaw's, which recently closed several stores, including one on King's Highway in New Bedford. Rand pointed to the debt of SuperValu, Shaw's parent company, as the reason the chain could not be more competitive with prices.
"They're a little soft, but I don't see them collapsing or anything," he said.
What does the shifting landscape of grocery stores mean for SouthCoast consumers?
Because they have the opportunity to shop around, they can demand that stores raise their standards — and drop their prices, Rand said. Stores, competing for shoppers' allegiance, will listen.
Consumers could see lower prices and better customer service, he said.
"There's so much riding on not losing that shopper."