ALBANY, Calif. -- For the past year, Andronico's has been part of Our Kitchen, a consortium of Bay Area retailers that has developed its own line of sauces, cheeses, soups and baked goods. The group is working on adding a line of milk and packaged deli meats, "all aimed at lowering our costs," said Bill Andronico, president and chief executive officer.
"We're also in the exploratory stage of trying to develop a just-in-time delivery system on some categories, and while we're not sure when we'll get there, we have already improved product freshness and turns so we don't have to carry large inventories while maintaining consistency of product.
"As more retailers come on board, economies will kick in that will drop our net costs. Whether or not we choose to reflect those reductions in our retails remains to be seen."
Andronico's is also moving slowly into private label, Andronico said, with its own name already on coffee as well as beef, fish and poultry lines.
The retailer has been buying most of its basic groceries from Unified Western Grocers, Los Angeles, (and its predecessor company, Certified Grocers of California) since 1991. Andronico's operates its own 35,000-square-foot produce warehouse in Emeryville, Calif. "We also like to deal directly with food brokers because in a market like this where there's a proliferation of independent operators, it's a good market to develop relationships with brokers. Large chains often bypass regional brokers these days, but we think we can benefit from working directly with a middle person at our level."
Andronico's has also benefitted over the years from relationships with manufacturers, he added. "Some large companies send their reps in and we deal with them, but it can sometimes be a little tense as we try to do what we want to do. They support us up to a point, but we prefer dealing with local and regional vendors who want to deal with us and who do things for us that are more creative and beyond the typical vendor arrangements.
"Those smaller vendors have more open minds, and we get feedback from them, but we'd like to see more programs that are different from what the typical national-brand supplier offers."
As Andronico's looks back this year to mark its 75th anniversary, Bill Andronico said the company is looking forward to fulfilling several goals, including the following:
To promote Andronico's as the place to get "the best" -- the freshest, the best quality and the most unique products -- while remaining competitive on basic grocery items.
To strengthen its image as a place to buy natural and organic foods as part of an effort to blunt the impact of Whole Foods Market.
To develop its own packaged goods through a consortium of retailers called Our Kitchen, plus a separate private-label line.