OKLAHOMA CITY -- Homeland Stores here will begin a new promotional thrust this week to boost nonfood volume an additional 5% of total store sales. The chain's nonfood revenue, including pharmacy, currently represents 15% of total store sales.
Weekly store circulars will now devote a full back page to nonfood specials beginning Jan. 17. The page will feature 20 to 24 nonfood items at reduced prices. Homeland pharmacies also will be promoted on the page.
A full nonfood page in the chain's weekly circulars is just part of a campaign geared to building a stronger presence in nonfood, said Steve Mason, vice president of marketing at the 69-store chain.
"We envision nonfood and pharmacy -- our fastest growing department -- growth to be very good with substantial sales increases from a lot more dedicated promotion selling space," he said.
The nonfood campaign calls for more promotional activity, including forceful promotions, increased event and seasonal selling space, and price-off sales.
To bolster its 4- to 24-foot general merchandise sections, Homeland plans branded general merchandise promotions throughout the year in plasticware and other categories. Such promotions will comprise percent-off and one-cent sales
and buy-one-get-one-free offers merchandised on off-shelf displays and freestanding shippers.
Homeland intends to remain a high-low priced chain. "We'll never be the lowest price across the board," said Mason, but he added that on promotional items the retailer would be the lowest price.
Last November the chain began lowering general merchandise and health and beauty care shelf prices and promotion retails 3% to 8%, reflecting a lower product cost after Homeland shifted to Associated Wholesale Grocers Valu Merchandisers, Kansas City, Kan., for all its nonfood merchandise.
Previously, rack jobbers had supplied general merchandise to the chain in a fully racked program. Mason pointed out that rack jobbers "tend to be replenishment-sales-oriented as opposed to promotionally driven."
For HBC, the chain previously purchased products through its own warehouse, which AWG had purchased.
Shifting to a grocery wholesaler from a service merchandiser for nonfood "lowered product costs, since we're benefiting from the wholesaler's larger purchasing power," Mason explained. During the fourth quarter, as Homeland reprogrammed nonfood using suggested planograms from AWG Valu Merchandisers, it expanded product variety by 25%. In December and January, Homeland also fine-tuned the sets, which varied by store size and demographics.
In applying category management, Mason said "store locations and customer preferences must absolutely be taken into account in the product mix."
The new nonfood mix offers a wider private-label HBC variety in the 500-item Best Choice label supplied through AWG Valu Merchandisers.
