Supermarket customers are looking high and low for housewares.
Not that the category is hard to find in most stores, but two of the biggest new trends in housewares departments are upscale products and dollar items. Industry observers expect more of this in the near future.
"There are neighborhoods where you need the dollar stuff. Then there are other neighborhoods where it is definitely an upscale market," said Charles Yahn, vice president, nonfoods, Associated Wholesalers, York, Pa. "You just have to look at the market, look at the area, and make a decision on almost a store-by-store basis on what you can or can't sell," he said.
"It's fair to say that we are seeing a kind of bipolar movement," said Neil Stern, retail consultant, McMillan/Doolittle, Chicago. "Some supermarkets are moving into the dollar products and the value-driven segment," while others are trying to move into higher-priced goods, he said.
The challenge for supermarkets in housewares is keeping their presentations fresh, according to Stern. For example, shoppers may go to a store like Crate & Barrel four or five times a year, so the presentation looks new each time they visit. But with customers going to the grocery store about 75 times a year, "supermarket assortments tend to age pretty fast," Stern said.
"So the dollar type of assortment, where you are in and out promotionally, keeps things fresh as opposed to the stable sets," he said.
On the other pole, many supermarkets are upgrading their housewares products and presentations. Andronico's Markets, Albany, Calif., which has upscale demographics, offers a wide range of products and price points, said Connie Taylor, category manager, housewares. For example, the retailer carries peelers priced at $4.99, $10 and $25.
"We offer a variety. Even though we are an upscale store, we want to be able to offer something to the person who's just running in because they want to peel their potatoes," Taylor said.
"We are expanding and growing the departments, and as we expand, we will bring in new categories," she said.
Mainstream supermarket chains like Pathmark Stores, Carteret, N.J., are balancing the demand for quality with the imperative of price, while making sure "we're the first to market," said Paul Pisauro, nonfoods category manager.
Last year, the retailer brought in Zak Designs melamine dinnerware sets for kids, he said. "We made a conscious effort in that category, and it was a successful launch."
Pathmark also has installed Kitchen Shop sections in five stores, which include "special metro racks to make it pop," Pisauro said. The sets measure 28 to 36 linear feet and include products like gadgets, cookware, bakeware and foil. One store carries small appliances like mixers, he said.
"We have specialty store items that you would find at retailers like Fortunoffs, but substantially lower priced," he said.
For the future, "as long as we keep prices aggressive, and keep the assortment fresh and updated, we'll see growth. With gadgets, cookware and bakeware, we're always looking to trade up to a better quality of merchandise for our customers," Pisauro said.
Retailer customers of Imperial Distributors, Auburn, Mass., are also responding to market demands that are at once upscale and downscale, said Al Jones, senior vice president, procurement and merchandising. "But the value segment is foremost in people's minds right now," he noted.
"All of our supermarket customers are wondering what they should do in regard to value product. Everyone is talking about the success of the dollar stores, and wondering how they should react, or if they should react," Jones said.
But meanwhile, "we are continuing to add more upscale housewares products to our mix. We got into kitchen shops fairly early, and we are continuing that. We are looking to upgrade that merchandise a little bit more, while maybe trimming the total assortment," he said.
Basic housewares products are the key to success for supermarkets in the near-term future, said Murray Appelbaum, president, Selecto Products Co., Ardsley, N.Y. "People don't know what tomorrow will bring, so they're not investing in expensive things." One approach is the dollar departments that many supermarkets are creating, he noted.
Years ago, people would buy a set of pots and pans that they would use for 25 years, he said. "Today, people aren't buying for the future; they're buying for today. It's the economy. People are afraid of losing their jobs, and they want to save money."
If stores are going high end, then "they're going high end in everything and upgrading the whole look, not just housewares. The basic supermarkets are going low end to compete with Wal-Mart," Appelbaum said.
K-VA-T Food Stores, Abingdon, Va., exemplifies Appelbaum's point. "For our stores, the value products do well just because of the income levels and the market areas we are in," said Jeff Compton, category manager.
Most supermarkets could be doing much more to maximize the potential of housewares, noted consultant A.J. Riedel, senior partner, Riedel Marketing Group, Phoenix. "There's a lot of cross merchandising that is not being done, putting together like items and like aisles. Housewares is isolated in its own aisle, which people don't go down on a regular basis," she said.
Riedel pointed to three trends that supermarkets could leverage to sell more housewares:
The 5-A-Day program that encourages people to eat five servings of fruits and vegetables a day. "With fruits and vegetables you need tools like cutting boards and storage containers," she said.
The low-carbohydrate Atkins diet. "You need tools to prepare and store meats and salads. Put items that relate to the food near those food products," she said.
Food safety. "Meat thermometers are an opportunity for grocery stores," Riedel said.
Housewares products favored by specific ethnic groups are becoming more important to retailers, noted Jones of Imperial. For example, he said Calderos non-coated aluminum pans are very big with Hispanic customers. "Many of our customers are doing very well with that product," he said.
"We are looking at putting four- and eight-foot Hispanic ethnic sections of housewares products even in mainline supermarkets that don't consider themselves to be in Hispanic areas," Jones said.
"Some of the gadgets and other products are very culturally oriented," added Yahn of Associated Wholesalers.
Merchandising products featured on television is another successful strategy for retailers. Some of Imperial's customers take advantage of "As Seen on TV" signage for products like the popular spaghetti pots with holes in the cover, Jones said. "These products are appealing to people because they are something different, and they are widely publicized. If an item gets hot, it sells very, very well. But the downside is, it can go away very, very fast," he said.
Andronico's clientele responds to products featured on the Food Network, Taylor said. "Once the cooking shows hit cable TV, everybody is tuning in to them. Cookbook authors are turning into celebrities. Consumers are watching them make the dishes and seeing how easy it is to prepare foods with these new gadgets," she said.