C&K Expands Small-Store Banner With Conversion

ELLIOT ZWIEBACH

BROOKINGS, Ore.. — C&K Market here said last week it is on the lookout for grocery stores of less than 10,000 square feet that it can convert to its new small community-store format.

It has already acquired and converted two stores to the new C&K Market banner — the corporate name that was not previously used on any stores — and two weeks ago it converted an existing Ray's Food Place to the new format.

Dan Cepeda, director of Center Store for the 61-unit chain, said combined weekly sales at the first two stores — in adjoining Oregon communities Yachats and Waldport — plus a Ray's in Waldport are up since last April, though he declined to be specific.

The Yachats store is 7,200 square feet; the Waldport location is 10,400 square feet and includes a drive-through pharmacy; and Walterville, the converted Ray's that opened Aug. 4, is 10,000 square feet.

The company expects weekly sales at the Walterville store to increase by 5% to 10%.

According to Cepeda, the chain decided to convert the Ray's “because customers weren't shopping the weekly ads — they were just going in to pick up a few items and then doing their major shopping on weekends somewhere else — so it made sense to make that store a C&K Market.”

The chain has only three other stores under 10,000 square feet, “and one of those, a 6,000-square-foot unit in Etna, Calif., has a lot of brand recognition under the Ray's banner so we don't want to interfere with that,” he said.

“But we're really interested in seeing what's available in communities along some of the key highways in our operating area. There are a lot of little communities along Highway 101 or Interstate 5 that have small grocery stores that are heavy on snacks, which people bypass on weekends to do the bulk of their shopping at larger supermarkets. Those are the kinds of stores we'd like to acquire for the C&K format.”

The C&K Markets feature the same categories as larger conventional stores, including groceries, perishables and general merchandise, but with shelves 3 feet wide instead of 4 feet, shorter aisles, smaller baskets and a 40% reduction in inventory to 10,000 SKUs, Cepeda said.

“We went category by category and looked at velocity to determine which SKUs to eliminate. The challenge was that we couldn't keep some brands in every set that are popular locally. So we have small sets for everything, including hardware, automotive and HBC, but everything has been tailored down. And customers can find everything they need at these stores to fill their carts.”

The company was also able to work with its vendors to get a c-store agreement for some categories, Cepeda said, “so that in the beverage section, for example, we're getting a better cost on single serves than on 12-packs.”

The three C&K Markets do not run ads, though they do offer customers a flyer every two weeks with a handful of promotional items, “and the lack of ad markdowns alone helps the operating cash flow at the stores improve,” Cepeda noted.

Besides the three C&K Markets, the chain operates 47 Ray's Food Place stores and 11 Shop Smarts.