Van der Laan Brings New Focus to Giant-Carlisle

JON SPRINGER

CARLISLE, Pa. — Sander van der Laan can't help but see Giant-Carlisle with new a set of eyes. After all, he arrived in central Pennsylvania from Amsterdam only last summer.

But what Giant's new chief executive officer sees is in many ways a new vision for Giant: Taking a well-developed existing brand and growing it through a sharper focus on value, and applying it to new formats to expand and broaden its geographic reach.

The plan in many ways resembles the work he'd done as an executive with Ahold's Albert Heijn chain in Holland, which earned him a reputation as a rising star there.

“He's young, very bright and very aggressive,” said Neil Stern, a senior partner with McMillan Doolittle, Chicago, who has worked with van der Laan on some industry projects. “He has very good insights into the industry and gets a tremendous amount of credit in the Ahold organization for being the guy who turned around the home market.”

At Giant-Carlisle, van der Laan is hardly stepping into a turnaround situation. The 148-store chain has enjoyed a run of same-store sales increases that is easily the best of Ahold's U.S. chains and would be the envy of many a competitor. Giant's brand positioning and store offering have been well crafted by predecessors: Tony Schiano and, more recently, Carl Schlicker, from whom van der Laan officially took the reigns just as Giant was enjoying its highest quarterly comps in five years.

In a recent interview with SN, van der Laan acknowledged Giant's strong positioning and recent success but indicated he felt the “dark skies” of the economy require the chain to keep a close eye on value in order for the strong performance to continue, particularly in the throes of a worsening economy.

“I think Giant is a very good company,” van der Laan said. “It's very well run and has a very strong brand positioning. And it's a company with many advantages over the competition. So the first thing we should do is continue to build on strengths that we already have.”

One challenge of building on that strength, he explained, is the ongoing balancing of Giant's “quality, service and savings” positioning. In today's difficult economic times, that means emphasizing the savings portion of the equation without detracting from its quality and selection aspects, he said.

“We have been renowned for our quality, selection and savings positioning, but savings in the current economic climate has become increasingly important,” he said. “To manage the balance between quality and selection on one end, and continue to develop a value proposition at the other end, is an important part of the strategy, and difficult to execute. We have had a lot of growth of value players around us; the penetration of price-driven competitors in Pennsylvania is obvious.”

Van der Laan, 40, studied business in his native Netherlands and got into the food retailing business through sales and marketing positions, primarily with Unilever. He joined Ahold nearly 11 years ago, serving as vice president of perishables for Albert Heijn, then as general manager of Gall & Gall, Ahold's Netherlands-based liquor chain, and finally as executive vice president of Albert Heijn.

According to Stern, it was van der Laan who took the lead in developing Albert Heijn's “VIP” program that lowered everyday pricing and sparked a reversal in the chain's fortunes. Versions of the program are now under way at Stop & Shop and Giant-Landover, the other U.S. banners in Ahold's portfolio.

“He made Ahold more competitive on his home turf, and he did it in a tough way: He negotiated hard with suppliers,” said Stern.

Among van der Laan's other accomplishments at Albert Heijn was crafting what he described as a “one-brand, multi-format portfolio,” which grew the conventional supermarket chain behind new formats, including a compact hypermarket, a convenience store and an Internet shopping component, all of which reflected the same brand attributes in different venues. The potential for Giant-Carlisle to employ a similar strategy is behind the development of a new smaller store, called Giant to Go, which is currently under construction in Lancaster, Pa., and scheduled for a grand opening this spring.

“It's not a supermarket, and it's not a typical convenience store. It's in both channels,” van der Laan said about Giant to Go, while declining to provide particulars about the store's selection or pricing. Strategically, Giant to Go is designed to help Giant grow by filling gaps between stores and facilitating entry to markets where its typical stores — some as large as 96,000 square feet — cannot fit, he said. It may also position Giant to gather in more kinds of shopping trips than it currently does, he explained.

“One of the reasons I believe there is still growth available in our current geography is that so far we have created a network of bigger stores, so if you want to do fill-ins within your network, you can probably do it better with small concepts,” he said. “At a certain point of time there is saturation in the market for bigger stores.

“There are also specific geographies, like Philadelphia, or downtown Harrisburg or downtown Lancaster, where opening a box of 96,000 square feet just doesn't work, so we believe if we develop smaller concepts, we can penetrate markets and attract trips and customers that otherwise would be going to competitors of ours,” he added.

Plans currently call for a second location for Giant to Go to open later this year, also in Lancaster, “and without going into detail, we are seriously thinking about ongoing development of formats even ahead of this,” van der Laan noted. “A big theme for us is to think about developing multiple formats.”

While this agenda for Giant may seem like radical change, van der Laan described it as an evolution, and one for which he's received the support of co-workers and employees on this side of the Atlantic.

“I am the first externally appointed CEO at Giant-Carlisle, so the fact that I'm from the outside, and coming from another country, is a bit of a change in itself,” van der Laan admitted. “But the whole organization and the people have been very positive and have given me a warm welcome.

“By nature, I'm not somebody who wants to manage the status quo; I'm somebody who wants to build the business going forward,” he added. “And in general, I find the company is receptive and willing to change.”