A FRESH START 1999

JONNA CRISPENS

EDMONTON, Alberta -- If at first you don't succeed, try, try again.

The old adage is the core philosophy of the DeBaji brothers, who've spent the past 11 years working to develop a successful concept to compete with supermarket giants that they blame for killing prior incarnations of their vision.

The persistence and experience is today paying off: DeBaji's Fresh Market -- the trio's latest effort -- is quickly gaining a popular audience from consumers looking for a change from the superstore approach to selling fresh foods.

The brothers have just opened a second unit that is larger and more multifaceted than their first version, located here. The new store, which is located in Calgary, Alberta, opened recently amid a blitz of television, radio and newspaper advertising as well as a pre-opening party the night before, to which 500 guests were invited.

"DeBaji's had never been in Calgary, so we had to let people know who we are," said Mazen DeBaji, who owns the two stores with his brothers, Nehad and Emad, and whose family has been involved in the retail-produce business for more than 20 years.

And if the past is any indication, getting to know the DeBaji concept is the first step in creating loyal customers.

The full-service concept is built around offering consumers the best of the best -- the most premium, upscale items -- with a focus on perishables, as well as fresh-meals items that are made from scratch using the store's own products.

But the new store, which covers 24,000 square feet, compared with the Edmonton unit's 16,000 square feet, goes a few steps further.

In addition to the expanded size of the departments, the new store will soon offer only organic beef (though it already carries a selection of organic deli meats); has a seafood selection that "far exceeds" that of its competitors; has an increased selection of value-added products; and offers pizza made in its own wood-burning oven. It also has an expanded bakery selection, and a prepared-food section that's double the size of the one in the Edmonton store.

And like the Edmonton store, the new store has health-food and floral departments, a cafe, and a dairy department that sells bottled milk and eggs that are delivered to the store the day they're packed.

The new store is representative of the strategy that the DeBaji brothers developed to survive -- and grow -- in the highly competitive superstore environment that existed when they opened the Edmonton store in 1994.

"Our goal was to separate ourselves by offering only the best" -- albeit at higher price points, said DeBaji, who, along with his brothers, had been forced to close two produce stores in 1988 due to superstore competition.

"After closing our two stores, we had to regroup and redevelop our marketing strategy," he said. "We had to ask ourselves, 'How can we stay in business and build our future?' "

When they first opened the Edmonton store, the DeBaji brothers opted for a soft sell -- a quiet opening with little or no fanfare, so they weren't making big promises before they knew they could deliver, recalled DeBaji.

"We displayed our inventory in big quantities and let it speak for itself," he said. "We didn't want to self-destruct. We wanted to be consistent and build strong customer loyalty."

At first, customers "were a little confused" by the higher price points, but in time they began to realize the quality of the products, said DeBaji.

"When you bite into an apple that's crispy and delicious, you understand why the price-per-pound is 20 cents higher," he said. "When customers take a product home and it lasts six days because it's so fresh, or when they put it on their table and the taste is great, they're willing to pay a higher price."

One of the ways in which the brothers ensure that they're carrying high-quality products is by purchasing about 80% of their products directly from the producers.

For example, all the produce carried within the stores -- and produce represents 35% to 40% of the overall inventory in each location -- is purchased directly from farmers and hand-selected by the retailer. The same direct-sourcing applies to the milk and eggs sold in the dairy departments.

The attention to detail paid off in the Edmonton store. After about six months of operation, the "transition was unbelievable," said DeBaji. "It was like someone made the announcement that everyone should be shopping at DeBaji's."

Produce is a key draw, he added, with the department generating 70% of the dollar volume in the stores.

With numbers like that, it took less than two years of operation before the DeBaji brothers began dreaming of a second location.

In addition to building on the successful elements of the Edmonton location, the brothers traveled to supermarkets across the country to study different operations.

"Every retailer has a different feel and spirit, and we wanted to pick out some of the things they had to offer," said DeBaji.

Prepared food was an area that the brothers identified as high growth, and, as such, one of the biggest changes in the new store is in the prepared-food section, which features about 58 feet of service case -- more than double that found in the Edmonton store.

The new store offers about 28 feet of hot prepared foods, with at least 36 items displayed on a daily basis. Current offerings -- all of which are made from ingredients found throughout the store -- are reflective of the colder weather and include stews, yam salad, baby back ribs, scalloped potatoes, garlic roasted potatoes, roasted vegetables and chicken teriyaki.

Customers wishing to eat their selections in-store can sit in one of the 72 seats found in the full-service, restaurant-style cafe, which also represents an expansion from the deli-style cafe that exists in Edmonton.

The prepared-food section also includes about 30 feet of ready-to-heat items, or about 72 varieties on any given day, including salads, rice dishes and meat dishes. In addition, the ready-to-heat selection includes one or two vegan food dishes -- known for their all-natural content and absence of dairy or meat -- and a few vegetarian dishes.

"People are looking for alternatives, which is why we're introducing vegan and vegetarian dishes, but we're going to tread lightly in those areas, since it will take time for that market to develop," said DeBaji.

The prepared-food section also serves as a springboard for one of the retailer's "major, major strategies" -- using prepared dishes to market the produce and other goods sold throughout the store.

"It's really crucial to our business -- it plays a big part in building our [sales] volume," said DeBaji, adding that the concept is used throughout the store, wherever prepared food is sold, including the cafe.

In the bakery area, for example, the retailer has a sign that reads, "Want to Make Your Own Pie? We have the Crust and Recipe," said DeBaji.

"A lot of people say, 'My recipes are secret,' but we're in the business of selling food," he said. "Everything we make is from scratch, and everything comes from our store, so our customers can reproduce any of the items."

Customers are also able to see the food being prepared, thanks to the store's open kitchen and pizza preparation area.

The meat and seafood departments also play a big role in the new store, with 50 feet of service case devoted to meat and 18 feet devoted to seafood. That's compared to 32 feet for meat and 12 feet for seafood in the Edmonton store.

A "huge change" in the meat department, according to DeBaji, will be the beef program, which will consist solely of organic beef when it's implemented sometime within the next six months.

Although the retailer is currently offering organic ground beef, it is still working on the final details necessary to introduce the full program, said DeBaji, with plans to offer 45 cuts of organic beef, sourced from a farm in southern Alberta.

"What's holding it up right now is that we sell mostly premium cuts -- about 30 tenderloins for every 10 sirloins -- so we have to find someone who can take the extra sirloins," he said, adding that a solution is very near.

"We believe organics is going to be a growing area," said DeBaji, who is also introducing organic deli meats -- two types each of ham, beef and turkey -- in the new store. He calls it one of the biggest changes in the deli department and expects such products to eventually be carried in the Edmonton store.

Value-added items are also being introduced for the first time in the meat and produce departments. The meat department is offering more than two dozen value-added items, including eight chicken items and six seafood; and the produce department is offering as many as 100 varieties of mostly value-added vegetables, such as precuts and ready-to-eat salads, as well as vegetable burgers and hot dogs. The retailer is not yet offering fruit, because of the category's short life-span without preservatives, said DeBaji.

Seafood is also expected to make a big splash in the new store, according to DeBaji, who said that only one other store in the marketing area offers seafood, and it's at nowhere near the selection found at DeBaji's. The new store offers an impressive 60 varieties from all over the world -- up from 40 in Edmonton.

The deli department will feature a total of 275 meats and 250 cheeses -- 60% of which are imported -- as well as 36 types of olives, mostly from California.

The 1,200-square-foot bakery, which is more than twice the size of the one in Edmonton, offers about 50 varieties of bread and buns and more than 100 pastries. Among the new introductions are pies made from scratch. DeBaji is offering 6-inch, 9-inch and 12-inch pies: apple and lemon meringue, offered on a daily basis, along with two rotating varieties, which will change with the season.

In addition to the perishables departments, the new store also represents a major move into what DeBaji describes as a "large growth area" -- the specialty grocery category. The store devotes 2,500 square feet -- up from 1,200 square feet in Edmonton -- in which it merchandises such specialty items as balsamic vinegars and olive oils from around the world, chutneys from India and France, salad dressings from Texas and preserves from California, said DeBaji.

Located on the first level of a multistory shopping mall, the new store has five main entrances: the main door and a door leading into the restaurant, both of which are accessed from outside; and three entrances that are accessible from the mall and lead into the health-food department, the bakery and a kiosk-like area where food from the restaurant can be ordered.

There are also nine 10-foot by 10-foot doors the retailer plans to open in the summertime to create an open-air market effect.