OKLAHOMA CITY -- People often joke that Wal-Mart is taking over the country. They wouldn't be joking if they were a grocery-store operator in this market, where some say the Bentonville, Ark.-based company is conducting a test to see just how much of the retail food market share it can capture.
One industry veteran, who asked not to be identified, said it appeared that Wal-Mart is being much more aggressive with its site location strategy in Oklahoma City than it is in other markets, placing stores unusually close together to smother the competition. In some areas, he said, Wal-Mart Supercenters are located just five to six miles apart, with traditional grocery stores and Wal-Mart's Neighborhood Markets in between.
Wal-Mart Stores said it has 19 total stores in the market, including 10 Supercenters, seven Neighborhood Markets and two discount stores.
A Wal-Mart spokesman said the company wasn't veering from its previously stated strategy in Oklahoma City.
"With Neighborhood Markets, the goal where we have a number of Supercenters already is to add Neighborhood Markets to provide added convenience," said Rob Phillips, the Wal-Mart spokesman.
According to a study done of the market early this year by Shelly Hale, managing director in the San Francisco office of Banc America Securities, Wal-Mart captured 25.1% of the grocery market last year, about double the share of its closest competitor, Albertson's, which had 13.1% of the market, and more than double that of the No. 3 chain, Homeland Stores. In 1999, Albertson's led the market with a 15.4% share, followed by Homeland at 14.7%, Crest Discount Foods at 10.2% and Wal-Mart at 9.5%.
Mike Biggers, director of operations, Crest, Midwest City, Okla., which recently opened its fourth store in the market, said his company tries to compete against Wal-Mart by focusing on "cleanliness, pricing and service," although he declined to comment specifically on Wal-Mart's strategy.