ARCADIA, Calif. -- Vons Cos. here plans to expand its upscale Pavilions format into San Diego next year, Larry Del Santo, chairman and chief executive, said at the chain's annual meeting last week.
Vons has 59 of its 330 stores in San Diego. Richard Goodspeed, president and chief operating officer, told SN the company plans to convert one San Diego Vons to Pavilions next year and to build an unspecified number of new Pavilions.
"As we move into San Diego, we'll see how well we do," he said. Vons now operates 34 Pavilions, all in metro Los Angeles, "and we hope ultimately to have 50, but we have no time frame to reach that goal." This year, Vons plans to open 12 new stores, including seven replacement units, and to remodel 46, including four store expansions, Del Santo said. Vons' goal is to have 80% of its stores new or remodeled from the preceding five years, he added.
New stores and remodels are one of four areas for "value creation" that Del Santo discussed at the meeting. The others are: · New marketing segments like neighborhood marketing to increase the authority of store managers, ethnic marketing to maintain low prices on certain staple items for Hispanic consumers, and nutrition centers, which Vons will have at 35 stores by the year's end. · New products and services, such as in-store banking, more private label (to exceed the current volume of 18% of sales), a crusty bread program, exclusive West Coast distribution of Boar's Head luncheon meats, and ongoing development of heat-and-eat meals at 140 stores. · New standards to bolster the basics of the business, such as more employee input in decision-making, a "Right at Night" program to keep stores fresh and fully stocked evenings and Sundays, and a sharper focus on seafood, with more payroll hours.
"We have developed a reverence for our customer, which has driven sales to new levels, and we must continue to look for ways to improve customer service," Del Santo said. "It is this reverence, coupled with our commitment to cost reduction, that will allow us to continue to create value for our customers and grow our earnings."