H-E-B GAUGES IMPACT OF 'MI TIENDA' HISPANIC FORMAT

ELLIOT ZWIEBACH

SAN ANTONIO - H.E. Butt Grocery Co. here said it is taking a wait-and-see attitude before committing itself to expanding its new Hispanic format, Mi Tienda (My Store).

"Our plan is to see how successful the first store is," Scott McClelland, president of H-E-B's Houston division, told SN, "and if it is successful, then we have a lot of other potential locations in mind. But we have no concrete plans at this time for additional stores."

Based on just a couple of days of operation, "the community has been very enthusiastic in response to the store's opening," McClelland said.

If it does decide to move forward with the format, he noted, H-E-B could decide to build Mi Tienda locations from the ground up or convert existing stores, as it did with the initial unit - a 63,000-square-foot store in Pasadena, Texas, approximately 12 miles southeast of Houston, in an area that is 80% Latino, McClelland said.

H-E-B also chose that location for Mi Tienda, he explained, "because we thought we saw an opportunity there to attempt a breakthrough in marketing to our Latin customers."

Asked if the store, which H-E-B acquired from Albertsons in 2003, was underperforming, McClelland replied, "Because it was not a ground-up store, it did not perform like a traditional H-E-B."

In designing the store, he said H-E-B had studied operations in Mexico, where H-E-B operates about 21 stores, Central America and the U.S.

Among the store's unique features, McClelland said, is a produce department that encompasses theatrical presentations - for example, customers can watch employees prepare fresh napolitos (cactus) by cutting off the thorns and slicing them into strips; a 52-foot full-service meat counter; a Mexican-style bakery; and two sit-down dining areas, with one inside (La Cocina) and one outside (El Patio), both featuring fresh prepared foods made on-site.

Employees are bilingual, with name tags that include their country of birth.