DOLLAR DAY SECTIONS ARE GROWING IN VALUE

JOEL ELSON

BALTIMORE -- Several independent retailers based here have established $1 general merchandise sections that, in some locations, encompass an entire side of the grocery aisle.

The sections, created in an effort to compete with dollar sections at mass merchandisers, have helped the supermarkets attract more nonfood customers, according to retailers polled by SN. Most are getting 30% margins.

"[The sections] offer customers the opportunity to find the same type of merchandise that they'd normally go to dollar stores to find," said Gerson Spiller, vice president and head grocery buyer at Farm Fresh Supermarkets, a 10-store chain.

Farm Fresh recently created permanent 36- to 60-foot "Look What a Dollar Will Buy" sections at seven stores. It is so pleased with the section that it plans to roll it into its remaining three stores by May 31, said Spiller.

Most Farm Fresh units display the mix in their grocery aisles, though several have placed it near greeting cards, paper goods and household cleaning supplies. Several said they have allocated space in the front end of the store.

These types of $1 sections, most of which are rotated either weekly or monthly, have had success in both urban and suburban areas. Overall, the sections are dotted with items "diverse enough to appeal to a wide cross-section of customers, and many pick up four to six items at one time," said Spiller.

Spiller said that while there are many dollar stores in the Baltimore area, Farm Fresh dollar sections do well because of their high impulse appeal.

Farm Fresh uses signs with

the "Look What a Dollar Will Buy" motto hanging over the aisle. The chain promotes four to six dollar day items in the category in each weekly food ad.

About two-thirds of the section is devoted to general merchandise items that would sell for about $2 at other stores, including batteries, cigarette lighters, cards, kitchen housewares, toys, party goods and cleaning implements. The rest of the section offers health and beauty care items, such as hair care products.

The mix is a combination of national brands, 30% of which are imported, and secondary labels from small manufacturers, said Nels Leavey, president of Rainbow Distributors, a Timonium, Md., rack jobber that supplies the fully serviced and guaranteed program.

Smaller items, such as batteries and lighters, are displayed on J-hooks. On flat shelving lower on the gondola are larger items, such as plastic laundry baskets, waste paper cans, shampoos, brushes, drinking glasses, scrub and bowl brushes, dishware, piggy banks and skin preparations.

Food storage containers are one of the top-selling items, followed by hangers and buckets, noted the jobber.

Food King Supermarkets, a six-unit retailer, generates incremental general merchandise volume from 30- to 60-foot-long "Dollar Values" departments placed in a grocery aisle a year ago, according to Bernie Meizlish, the chain's president.

The sections, which are promoted in ads, enable Food King to go up against the dollar bargain stores and mass merchandisers in the Baltimore area, Meizlish said.

"This is an opportunity to buy the same type of merchandise that they're buying in the dollar store," he said. "The more I have to offer, the better chance I have that they will not go to a hardware or dollar store." Meizlish said he buys some dollar day nonfood items from other vendors and importers.

Community Foods, which operates seven Super Pride Markets here, began installing permanent 12- to 16-foot "Dollar Day" nonfood sections near the front entrances of its stores last October. It plans to have all seven sections completed by next month.

"The product mix is high-impulse and generates extra nonfood sales," said Ed Brown, director of merchandising. "If we didn't carry it, our customers would go to a Kmart, a drug chain or dollar store."

The sections have boosted general merchandise volume about half a percent at the chain, said Brown. The mix is in 5-foot-high fixtures set up in front of produce, near a wall of value.