A&P IS ON FRESH PATH TO GROWTH IN FUTURE

STEPHEN DOWDELL

MAHWAH, N.J. -- If the newly designed A&P store here had a motto, it might be, "If it grows, we carry it here."

That boast was made by the head of produce for A&P's Metro New York store group, Tom Cignarella, and it typifies the ambitious goal the chain is setting for itself throughout North America: to become the superior produce merchant, and fresh food purveyor of choice, in every trading area in which it operates.

The 54,000-square-foot prototype, which opened here around Memorial Day, is A&P's roadmap for reaching that goal. (See related story on Page 1.)

It sports the Montvale, N.J.-based company's most comprehensive and up-to-date presentation of fresh foods yet, tapping into many of the latest fresh "must haves," such as grab-and-go Mexican entrees, rotisserie chickens, gourmet pizzas, European breads, organic produce, fancy cakes and even an olive bar.

What's more, the store gives each department the room to do the merchandising right, steering clear of the typically cramped style of its gourmet Food Emporium stores. While it sets no new benchmarks compared with the industry's national avant garde, the new fresh A&P does bring the venerable old chain up to snuff in the fresh food game. Christian Haub, A&P's president, said the store "really represents what we believe is our store of the future."

The format is already making waves in the here and now. It racked up the highest volume of any store opening in A&P's history, for example. In the weeks since the grand opening, more than half of total sales have been

perishables, said Haub. The local word on the street is that the store is drawing excellent traffic.

"The mix is great. We are selling more produce than usually," Haub told SN during a recent store visit. "If you take all the perishables departments, they have a much higher share of the total business than our regular store would have."

Haub said A&P hopes to duplicate that scenario -- a major chunk of store sales going to high-margin perishables -- in new store openings and remodels from this point on, whether the stores fly the Farmer Jack, A&P, Waldbaum's or Kohl's banners.

While the particulars will vary according to the needs and food buying habits of each specific trading area, the fresh layout will follow the same formula pattern: a standout produce department; followed by an expanded deli with strong emphasis on takeout food; extensive (if relatively conventional) meat, seafood and dairy departments; and a roomy bakery that spotlights store-made products and high quality specialty items.

Produce is the signature department, first in the shopping pattern and the standard bearer for the chain's new commitment to fresh foods. Floral is tucked in adjacent to the department.

"I like to say produce is the pace setter," said Cignarella. "We are going for the farmer's market look, with an emphasis on variety and freshness like you don't normally get here in this market."

The department here is nearly 1,100 square feet, leaning heavily on mass display of bulk products, much of it nonrefrigerated. Its distribution rate is 13%, outselling meat by several points.

With 260 to 280 items, the department is the high-volume version of A&P's new produce strategy; lower-volume versions are also planned for some stores, depending on the local shopping habits.

Produce is dominated by three European gondolas, with bulk produce spilling out of shipping cartons on either side. Wooden crates and barrels of products flank the tables. Large chalkboard signs identify items and prices, and also reinforce the message of freshness and wholesomeness.

The first display in the department, facing the front door, is the produce "power base," the handful of weekly hot feature items. On July 14, they included cantaloupe, broccoli, cucumbers and peaches.

Along the wall behind the first gondola is a section of value-added salad packs. Cignarella said A&P is probably the biggest user of value-added produce in the New York Metro area; the Mahwah store's extensive section represented a considerable variety.

Variety, in fact, is a key element to the total department's strategy. Its selection betters other A&P's, with more emphasis on premium items such as Holland vine-ripened tomatoes and ripened West Coast tree fruit, an organic section with 20 to 40 items, an expanded specialties section and atmospheric touches such as large portabella mushrooms sold in bulk and mesculin salad mix out of a box.

The department goes to considerable lengths to communicatewith shoppers. It uses a set of 50 to 75 small informational signs to identify new or exotic items and share preparation tidbits and nutritional qualities. The week SN visited, chalkboard signs drew attention to New Jersey blueberries "home grown by our hand-picked farmers." Throughout, the department drives home the message that its offers uncommon variety and freshness.

"It is a prime objective now to provide the best produce in every market we trade in," Haub said. "This is a major improvement in variety."

Improvements extend as well to the deli, the next fresh department in the layout. Counting a huge carryout cold island, the department is close to 900 square feet, with an item count of 200 or more and a primary emphasis on high quality prepared foods, made in the store for eating at home.

The carryout island holds fresh pizzas, which include such gourmet varieties as vegetable, white and tomato-spinach. Large signs trumpet the fact that the pizzas are store made; signs also made it clear the pizzas were offered temporarily on a buy-one-get-one free deal.

Sales from the program average about 1,000 pizzas a week, according to Manny Skounakis, deli-bakery supervisor for A&P's New Jersey North division.

The assortment of foods in the rest of the island case -- and in an adjacent case along the back wall labeled The American Deli Co. -- reads like a living manual of current supermarket prepared food trends: chilled entrees with ethnic themes such as Mexican and Italian; single-serve side dishes; three types of dome-packaged cold rotisserie chickens; premade sandwiches, salads and quiches, complemented by fresh desserts and even cold drinks.

Prepackaged deli meat, vacuum-packed in the store, finished off the case space along the wall. A service case held a full complement of the items offered for takeout, in some cases in hot form.

Skounakis said the service case is currently doing bigger business than self-service, but "self-service is doing as well as expected," Skounakis said.

"Overall, we are thrilled with the performance of the total deli department," he said. "We get a big lunchtime crowd, as well as dinner business after work. So far the sales volume exceeds our expectations."

He added that all prepared foods in the store are made on the premises, under the supervision of a chef trained in Salerno, Italy. "This store represents the furthest steps so far to being gourmet and up to date in deli-food service," Skounakis said.

Items such as European breads, Hungarian cheesecake and Middle Eastern pastries also give the expanded bakery a gourmet flair compared with other A&P stores.

The department at the Mahwah prototype stands at almost 1,200 square feet, filling the far right corner of the store. It divides the space between a self-service freezer case of occasion cakes, a refrigerated takeout case and three self-service slanted tables with cookies, pound cakes, pies and other items.

Marlene Tucci, bakery specialist for the Metro group, said the department is doing $25,000 a week, with its distribution rate at a healthy 4%.

The production format is semiscratch, with a significant increase of store-made items in virtually every category compared with earlier A&P bakeries. Tucci said the majority of items in the department are store-made, which in aggregate has boosted the quality level A&P can achieve for the department.

"The hottest categories are cookies, especially jumbo Chinese cookies, and cakes," she told SN. One slanted table is dominated by prepackaged cookies of many varieties, large and small. "The items are all scratch," Tucci said.

"The program is dynamite and really a standout for the store. On a bad day, we sell one batch of the Chinese cookies, which is 60 packages or 120 cookies. On a good day, we are into a second batch by the afternoon."

Baking goes on day and night, with rotating shifts made up of seven full-time bakers and about 10 part-timers. "This is the highest volume department of any A&P in the Metro division," Tucci added.

The service case features 100% store-made items, mostly cakes, pies and other desserts. Standouts are specialty items such as fruit pies, "eclair-mobiles" shaped like race cars, and a deep dish pie sold with the glass dish it was baked in, for $14.99. "It's a good weekend item," Tucci said.

The meat department makes no radical departure from previous A&P approaches, which Haub ascribed to the department's relatively mature status on the fresh foods continuum. The store has no service meat offering, for example.

Seafood, on the other hand, represents a new wrinkle in A&P's evolution. The department here offers service and self-service items on equal footing in terms of case space. It represents a settling between two extremes of total service and total self-service that A&P had swung back and forth between over the last several years.