ALBERTSON'S IS PLANNING REVITALIZED CENTER STORE

BARBARA MURRAY / Additional Reporting: KAREN DeMasters

BOISE, Idaho -- Albertson's here, with supermarkets in 37 states, plans to revitalize its Center-Store operations by eliminating weaker stockkeeping units and working with its suppliers for better promotions, according to a spokeswoman, Jenny Enochson.

Her comments followed the announcement of an effort to pull up financial results for the chain, according to the company's president and chief operating officer, Peter Lynch (SN Aug. 28, Page 1) . Speaking about the chain's lower-than-expected earnings for the second quarter, Lynch said the company has launched "a renewed focus on the center of the store" as well as "a renewed culture of thrift."

Some analysts said Albertson's decision to shore up its Center-Store operations is due to the competitive threat posed by Wal-Mart supercenters, but Enochson said it was not so much Wal-Mart as every competitor, and that the chain would focus on two areas for improvement in Center Store.

"We are working with our suppliers for better promotions in the center of the store and we want to eliminate underperforming stockkeeping units," Enochson said.

Research analyst Jonathan Ziegler, of Deutsch Banc Alex. Brown, San Francisco, said, "The issue all these guys are confronting is that they have to make Center Store exciting.

"Kroger is doing some good things, and the Albertson's Broadway store near its headquarters in Boise is remarkable. It's a 27,000-square-foot box, unlike their usual 55,000-square-foot stores, not that you can't do something exciting in a 55,000-square-foot store. Center Store is a commodity; everybody has it. In Albertson's Broadway store they shrunk down the SKUs and shrunk the gondolas to make more room for the perimeter. Kroger has created real power categories, [by moving] refrigerated units into Center Store, selling fresh refrigerated pasta and sauce in those units in the dry pasta aisle."

Albertson's has revamped its pet aisle and the baby aisles, but there are still some new technologies, such as kiosks, that could be used, for customers to ask a question about their pet, or their baby, Ziegler said.

Ziegler saw an Acme unit in Philadelphia that company officials showed to analysts. "I think they know how to do it, but it will take a long time. Can you do it fast enough, is the question. Wall Street has that sense of urgency. Albertson's has bitten off a lot and has disappointed people. Their stock collapsed [last] week. They have a lot of balls in the air, and huge potential."

A 40-page booklet of four weeks of savings was on hand in one Acme SN recently visited in Manasquan, N.J. which Enochson said was a chainwide offer. "Bonus Buy! No card needed" savings through Aug. 26 included 6-packs of A&W, Sunkist, 7-Up or Canada Dry Ginger Ale, buy one, get one free. Kellogg's Smart Start, Raisin Bran or Froot Loops at two boxes for $4, Kellogg's Pop-Tarts, three packages for $5; Keebler Chips or Pecan Sandies, two for $5. Also on the cover page were specials on Ultra All and Surf Ultra Liquid Detergent, each at 100 ounces for $3.99; and 18 ounce packages of Ivins' Spice Wafers ("first of the season"), two for $3.