HICKSVILLE, N.Y. - The gray concrete exterior hardly conveys the colorful and comprehensive array of Asian foods within. There is a plethora of soy sauces and Chinese cabbage, as one might expect. But what surprises the first-time shopper is a vast range of ethnic specialties from across Eastern Asia, including dried sea trout, pickled string beans and live tilapia fish - netted and killed before your eyes.
Welcome to Good Neighbor Oriental Food Outlet in this Long Island suburb, and to what could be a successful retail formula in the future of grocery shopping.
The single-unit operator - its legal name in English is Long Island Food Outlet - displays more than 4,000 stockkeeping units. While supermarkets in urban ethnic enclaves might stock exclusively Chinese or Korean goods, Good Neighbor carries a much broader assortment.
"Some stores have just foods from Korea or from one part of China, but we have foods from all parts of China and from all across Asia," said Richard Lim, a store manager. "Some people come here from New Jersey because we carry snacks from different provinces and cities in China."
The store is located in a nondescript warehouse district along a commuter railroad line. First-time shoppers need to dodge delivery trucks while scanning for a bright green awning with Chinese lettering that reads, "Good Neighbor Oriental Food Outlet." Printed in English, in smaller lettering, it reads, "Warehouse Food Outlet."
What makes the 4-year-old Good Neighbor successful, by several indications, is variety, low cost and breadth of specialty products within its 20,000 square feet of space. In the produce section, a shopper finds several types of bok choy, fuzzy squash, long beans, lemongrass and flowered chives.
An entire aisle is devoted to noodles. The aisle begins with noodles from Vietnam, then transitions into Chinese noodles. Next come Korean and then Japanese noodles, followed by a noodle common in Hong Kong. The second half of the aisle is all instant noodles, and the tour begins anew with noodles from Korea, Japan, Hong Kong, Vietnam and Thailand.
Along the long aisles, a few brands (Kikkoman soy sauce, Kadoya sesame oil) are familiar to non-Asian shoppers, but there are far more obscure products with brightly colored labels in several languages that come from small, regional producers in Asia.
Because of its vast selection, Good Neighbor draws shoppers from a varied ethnic array and from great distances, as well as from the immediate community. Shortly after opening, Lim increased the scope of the inventory to include Filipino, Malaysian and Indonesian foods and sauces. He later began to niche market to an increasing number of Hispanic and Caribbean shoppers. Caribbean pepper sauces now stand next to Vietnamese and Thai chili sauces. Likewise, a worker at the fish counter speaks Spanish.
"Last spring, when the Haitian mangoes came in, we sold 500 cases of them mostly to Caribbean people," Lim said. There are nine mangoes to a case. Lim added that Haitian families and church groups also buy 100-pound bags of Riceland rice at $22.50 each, and ship them back to Haiti.
AN ASIAN WAREHOUSE
Good Neighbor is a bare-bones warehouse outlet. The floor is concrete, and items are displayed on industrial shelving, with backup stock towering above. Due to a high ceiling, lighting is dim.
A 3,000-square-foot walk-in cooler has an extensive selection of Asian vegetables, while 1,500 square feet of freezers filled with packaged foods line the walls. There is a wide selection of sprouts and vegetables soaking in large tubs in a self-serve area.
"We keep our costs low and our prices 20% to 30% below supermarkets," Lim said. Producers of top brands are less accommodating on volume purchasing, but Good Neighbor is still able to offer them at 10% to 15% less than other retailers, he said.
Lim says his retail model is based on studying the low-cost formulas of Costco and Restaurant Depot. Location in a warehouse and not a conventional retail building produces big savings.
The store deals with as many as 20 different distributors of Asian foods. Buying is coordinated by a Chinese-born merchandise manager with more than 20 years' experience.
Branded items are so inexpensive that shopping carts fill up fast. Kikkoman soy sauce is $2.89 for a 20-ounce bottle; $9.99 for a gallon. Kikkoman's Memmi-brand noodle soup base is $1.79 for 10 ounces; Lee Kum Kee's hoisin sauce, $1.59, 20 ounces; Kadoya sesame oil, $1.99, 5 ounces; Koon Chun black vinegar, $1.99, 20 ounces; and instant ramen noodles, 49 to 69 cents, and some packs are 3 for $1.
Good Neighbor has several in-store departments. A fish department features whole fish on ice, as well as two tanks of live fish, one tilapia and the other sea bass. Customers point to a selection, and an attendant nets it, places it on a wooden block and whacks it with a mallet. The fish is then weighed, gutted and cleaned.
"Chinese people like their fish very fresh," said Lim, who was born in Beijing and came to the United States in 1990. The fish department staff works very efficiently, and there is a tip jar. Lim explained that in Chinese culture it is customary to tip an attendant who kills and cleans a fish on request.
Next to the fish counter is a meat department. Large cuts of fresh beef and pork are on display, and a butcher cuts pieces to a customer's specifications. As with fish, the Asian preference is for freshly cut meat, not the case-ready meats common to supermarkets.
Prices for fish and meat are notably lower than in surrounding supermarkets but are "similar to Flushing [in Queens, New York City]," Lim said, referring to the nearest Asian community. He points out that the live sea bass that Good Neighbor sells for $4.99 a pound, he buys for $3.99. "Margins are very slim."
A popular feature at Good Neighbor is the $1 aisle, located at the store's entrance. It is a jumble of kitchen utensils and gadgets, T-shirts, plates and dishes, underwear and fly swatters, all priced at $1 or, in some cases, $3 for multipacks.
Overcrowding of merchandise makes it hard to pass through with a shopping cart, but the haphazard appearance of the aisle seems to excite shoppers.
This warehouse formula and low prices generate high foot traffic and fast turnover. Fresh vegetables and fresh fish are bought daily from 3 to 6 a.m. at Hunt's Point Market in the Bronx in New York City. Lim said that annual sales are "low seven figures" and "increasing steadily." The store does little advertising since word of mouth works well to bring in devoted shoppers, he said.
Good Neighbor shoppers tend to buy in large quantities for two reasons. First, they commonly shop for large families, extended families with three generations living under one roof - Asian families average 3.08 members vs. 2.59 for total U.S., according to the U.S. Census 2000. Second, a large percentage - Lim estimates 40% to 50% - may be involved in a restaurant and are buying supplies for that operation.
Dennis Wong, a Hong Kong native who lives nearby in Syosset, N.Y., ventures to the city to buy food but also shops at Good Neighbor.
"Shopping in Flushing is like going to Hong Kong," Wong said. "But shopping at Good Neighbor is almost like shopping in Flushing."
Good Neighbor is surrounded by several mainstream retail chains, including King Kullen, Stop & Shop and Waldbaum's. But SN did not see any significant Asian food sections in these stores. A Target store in a nearby mall also does not have an Asian food section, nor does a Costco located about 10 miles away.
The Changing Face of Suburbia
HICKSVILLE, N.Y. - Located a half-hour east of New York City, this classic railroad town provides a textbook portrait of the increasingly diverse American community where families from Asia - particularly of Chinese, Korean or Indian background - are bringing new flavors to suburban life.
Of the 41,260 residents in Hicksville, 3,731, or 9%, describe themselves as Asian (vs. 3.6% nationally), according to data from U.S. Census 2000. Some 3,819 (9.3%) called themselves Hispanic or Latino (vs. 12.5% nationally).
Significantly, 9,418 (23%) said that they speak a language other than English at home, compared to 18% nationally.
Asian Americans also comprise a significant part of the population in neighboring towns, Syosset is 13% Asian; Jericho, 11%; and Plainview, 5% - all significantly higher than the national average.
"Immigrants used to begin in the central cities, but now they move directly to Long Island because we have well-established immigrant populations," said Pearl Kamer, chief economist of the Long Island Association, a business organization. "Hicksville is a perfect example of this."
And while inner-city neighborhoods may be monolithically Chinese or Korean or Filipino, a place like Hicksville is far more diverse. Here, an Indonesian family may live next to a Korean family - and both families find familiar foods at Good Neighbor.
The Growth of Asian Supermarkets
Asian-themed supermarkets are emerging all around the country, with a concentration where Asian populations are heaviest, namely California, Texas, and New York and the Northeast.
In contrast to previous retail patterns of opening food stores in urban communities, many of the latest Asian supermarkets are in suburban locations.
"As Asian Americans migrate to the suburbs, they bring with them their cultural and culinary traditions," said Saul Gitlin, executive vice president of Kang & Lee Advertising, New York, which specializes in Asian-based advertising and marketing.
"For 20 or 30 years, the needs of these populations were served by mom-and-pop shops," Gitlin said. "On the heels of the dramatic population growth we've seen since 1990 comes the rapid rise of large supermarket grocery retail outlets, and these stores are increasingly found on the urban peripheries."
One leading chain is the 99 Ranch Market, which operates 25 full-service supermarkets, mostly on the West Coast. Other chains include Market World Hannam, a group of six Korean-oriented full-service supermarkets located around Los Angeles, and H-Mart, a chain of 20 Asian supermarkets specializing in Korean foods.
One reason the Asian supermarket concept works in Asian communities is family size. Asian families average 3.08 members vs. 2.59 for the total U.S., according to the 2000 Census.
"There is a strong receptiveness to multigenerational families," Gitlin said, "and one household may be looking for a wider range of products because they must meet the needs of babies through the elderly."
Mainstream supermarkets have begun in-language marketing and communications outreach to key Asian-immigrant communities via the Asian language media, Gitlin said. "This is most visible in California where supermarkets such as Albertsons, Vons and Ralphs actually have some good history marketing and advertising to key Asian groups, including Chinese," he said. He noted also that Wal-Mart Stores recently created a TV commercial in Mandarin for Chinese stations. The spot shows three generations pushing a shopping cart.
Retailers Eye Ethnic Store Formats
WASHINGTON - Retailers are embracing ethnic aisles and store formats as a way to differentiate their stores from the competition, according to a report by the Food Marketing Institute here.
Nearly 80% of respondents to FMI's "Facts About Store Development 2005" said they have ethnic food aisles and sections. The report surveyed 77 member companies representing 4,208 stores.
Among other findings: Ethnic is the third-most-popular new-store format (offered by 25% of respondents), following gourmet/specialty (66.7%) and natural/organic (50%).
Surveyed companies said niche stores can help them reach highly selective consumers and broaden market share. Other trends include creating space for cooking demonstrations, coffee bars and in-store pharmacies.
"There is no longer a 'one format fits all' supermarket," said Michael Sansolo, FMI's senior vice president. "Understanding the specific needs of your targeted consumers and delivering what they need are essential for success."
Planning Ahead
ENGLEWOOD CLIFFS, N.J. - Hispanics get more value at food stores than the general market, according to a new Hispanic consumer shopping insight study from Unilever here.
Unilever released some of the top-line findings to SN in advance of the report's official release next month.
"They're very smart shoppers," Ricardo Martinez, Unilever's director of multicultural marketing, told SN.
Food shopping is part of the Hispanic shopper's routine, translating into more planned trips, and fewer quick trips and impulsive purchases.
Titled "Winning the Hispanic Shopper Trip," the attitudinal study explored the food shopping behaviors of about 800 consumers by analyzing store receipts and shopping diaries.
