ANCONA'S MARKET CONTEMPLATES ITS NEXT MOVE

CHRISTINA VEIDERS

RIDGEFIELD, Conn. - It's the big-name chains that strike angst in the hearts of single-store operators like Ancona's Market here.

But today, the retailer is fighting stiff competition from a fellow independent - a sign the independent sector is thriving.

While Ancona's has plenty of chains to go up against, in 2003 the Caraluzzi family, a local independent grocery operator, took over the lease of an abandoned 27,000-square-foot Waldbaum's, located just a mile away. Caraluzzi's positioning, similar to Ancona's, is based on service and quality products. Low prices are also part of its equation.

Both operators are supplied by Bozzuto's, Cheshire, Conn. In fact, Bozzuto's has been supplying Ancona's for 50 years, longer than any of its customers.

Ancona's is a long-time IGA retailer, a distinguishing factor from the independent down the road.

"IGA is a great symbol to be associated with," said Joseph Ancona, 72, who co-owns the store with his brother, John, 61. "It shows we belong to something and are not just out there alone," he said. "We have somebody to back us up. We get better pricing and better distribution."

The brothers admit Caraluzzi has cut into sales, but they won't say by how much.

Over the last decade, Ancona's has dealt with its share of market changes. Ahold's Super Stop & Shop, Big Y and Trader Joe's have moved into Redding and nearby Danbury, as has Costco, a Wal-Mart discount store and Target. Meanwhile, Grand Union and A&P have moved out.

"We continue to adapt," said John, in response to the latest competition.

Ancona's has learned in its 86 years in business that competition can make you a better operator.

The retailer is reassessing its position in the affluent Fairfield County town where the average family income is $107,351, according to U.S. Census Bureau figures.

The local market is awaiting the development of a 55-acre site of the former turn-of-a-century wire factory, Gilbert & Bennett, located a mile down the road in Georgetown, part of Redding. The plan is to make the development into a mixed-use neighborhood with over 400 housing units and commercial retail and office space. As long as no other big chain operator moves to the site, the future development represents an influx of potential new business for the grocer.

Third Generation

With the retirement of Joseph Ancona, the family is transitioning to the third generation of Anconas. Joseph's son, Joe, 42, has recently returned to the family business after graduating with a degree in architecture from Carnegie Mellon University. He told SN he decided to apply the skills he learned working for a large real estate developer to help re-engineer the family business.

First on the agenda is a remodel of the 28,000-square-foot store, which was built in 1980. This is Ancona's third store location. The remodel is expected to be complete by next year, and will include repositioning some departments and expansion of others, Joe said.

Plans are to expand and reposition organic produce to the front of the store where it will be one of the first departments shoppers encounter.

Ancona's is counting on organics and natural foods to be its growth driver in the future.

Demand is evidenced by Ancona's milk sales with organic comprising 50% of sales and growing. Ancona's sells a half-gallon of organic milk at $3.99, compared with $2.99 for regular milk.

"Organics is one of the things we strongly believe in," Joseph said, "and we are moving in that direction strongly and solidly."

The retailer also introduced a natural personal care section with brands such as Jason, Alba, Avalon, Nature's Gate and Kiss My Face, as well as Seventh Generation, nontoxic cleaning and paper products. It is building its organic focus, in part, through United Natural Foods, Dayville, Conn., a new supplier for Ancona's.

The move into organics is a natural progression for Ancona's, whose reputation is built on high-quality perishables.

Ancona's declined to give yearly sales volume, but Joe told SN produce is an anchor for the store and represents about 14% of total sales volume.

Top Quality

The retailer has long prided itself on its quality meat department. "We have a lot of rules we don't break," Joseph noted. "We don't sell anything that isn't graded USDA choice or better." The majority of meats it sells are certified Angus beef, including Ancona's ground meats.

"It makes all the difference in the world with ground meat. We don't use any previously prepared product in our ground meats," John said.

The meat department will be redesigned and service will be emphasized. "This always has been our strong point," Joe said. "In an era when Stop & Shop is cutting back on its services, we can differentiate ourselves through our services. Service in meats is one of the things that established our name in this town. For the holidays, we'll almost triple our meat sales. We want things to be right for that special meal."

The Ancona family puts its home phone number on fresh turkeys and rib roasts in case customers have any questions when cooking during the holiday.

Prepared foods is another area set for expansion. Ancona's plans to increase prepared foods variety, reduce shrink and improve consistency. "We are creating a situation where we will bring in a product in the prepared foods area, and support it through multiple departments. It will first be sold as a prepared food, and [if it doesn't sell within its allotted time], then it will be cooked as a take-out meal."

For years, Ancona's thrived on its take-out business in a town where zoning once prohibited take out in restaurants and where no fast-food outlets existed.

Michael Bozzuto, chairman, president and chief executive officer of Bozzuto's, told SN he knows his stores "by the little things they have." In the case of Ancona's, it's the fried chicken, he said, which has long been a traditional favorite with Ancona's customers, and its macaroni and cheese.

Ancona's has 14 feet of hot prepared foods with a rotating menu each day that features freshly cooked and carved meats, fish and side dishes. The deli is extensive, including a large selection of freshly prepared salads. The retailer bakes its breads from scratch. With a new oven on order, Joe said, he aspires to making three or four great artisan breads that are so good shoppers will find them compelling enough to come to the store just for the breads.

Ancona's will reformulate some of its menu items to include organics and healthful products.

Joe said they have established a relationship with a holistic health consultant and will be working with her to build a culture of healthy and wholesome foods. "Whether you buy it here [in the ready-meals department], or out there, it will all be consistent," he said.

Local Products

Besides organics, Ancona's also is building its business through specialty food and locally sourced products. While Bozzuto's brings in unusual products not found at the big chains, Ancona's goes out of its way to find locally produced items. When SN visited the store, it was tasting homemade marinades from a local producer, featuring Sankow artisan ice cream from Beaver Brook Farm, Lyme, Conn., and selling Wave Hill bread for $4.99, baked fresh by a husband and wife in Wilton, Conn.

These are items that fly under the radar of the big chains, Joe said. "As different product groups get commoditized and distributed everywhere, we still have the ability to nimbly source from the local guy," he said. "These are outstanding products and better than what is conventionally available. These can give you that market niche."

Operationally, technology has been the toughest learning curve for the family, Joe said. Ancona's will begin utilizing its sales data to better buy, merchandise and develop marketing initiatives. "That is only the tip of the iceberg," Joe added. "What it really means is getting all department managers trained to use these tools to then do everything in a more efficient manner - buying, scheduling and tracking results."

Many improvements on the operation side will be facilitated through Bozzuto's services. Ancona's recently signed up for the wholesaler's category management service that provides assistance in cutting in new items and phasing out others. Bozzuto's also helped Ancona's design a new look for its promotional ad flier.

While the retailer strives for consistency in its store offering, it will do the same on the marketing end. Plans are to launch a website and carry its message through to the print advertising and broadcast media. After that, Joe said, it is following through with community outreach, an important element in the business.

As Ancona's transitions to the third generation, it will continue to build on what has made it successful in the past - quality and service, Joe said, and he did not rule out yet another move to a new location.

"We have an excellent franchise here, and a long history that gives us an opportunity to build on.

"You'll see innovative products and services that we create and offer here. Our competitors have imitated a lot of things we've done over the course of time, but we tend to stay ahead of the curve and do things that are riskier and different than others."

While profitability is essential, Joe said, he also believes in other equally important values. "It's not only whether you can make money, but also what is beneficial to the community and being sensitive to the environment. Then you can realize a triple bottom line," he said.

Life Achievements

Ancona's Market is said to be Ridgefield's oldest family-owned business. Joseph Ancona, a Sicilian native, began the business in 1920 after making his way to Georgetown, Conn., a section of Ridgefield, where he worked for a time at the Gilbert and Bennett wire factory, which is now being turned into a mixed-use development.

After serving in World War I, he returned to the area and began selling goods out of a small store on Route 7, about a mile from the present Ancona's Market store. He moved into his second location in 1949, a red brick structure, also on Route 7, where his family lived over the store.

From 1949 to 1958, the Ancona family operated grocery, package liquor and hardware stores. Three sons - Joseph, John and Nazzareno (Nano) - helped run the businesses. Joseph and John joined the grocery operation and Nano and his wife ran the liquor store. After the elder Joseph's death in 1958, the family liquidated the hardware store. Joseph and John took control of the grocery store, and Nano and his wife assumed control of the package store.

In 1969, Ancona's became an IGA retailer. The grocery store along with the packaged store moved to its third location in 1980 where the present Ancona's Market is located, near the intersection on Routes 7 and 102.

The operation is now making a transition to the third generation of Ancona's. The package store was turned over to Mitchell Ancona and his sister following the death of their father Nano several years ago. Meanwhile, Joseph's son, Joe Ancona, re-joined the grocery business late last year after spending 14 years away, getting his MBA in architecture and working for a real estate developer. John's daughter, Gina, also is working in the store after a stint in sales. Joseph, 72, is officially retired.

Ancona's wholesaler, Bozzuto's, Cheshire, Conn., recently honored Joseph with a Lifetime Achievement Award. In presenting Joseph with the honor, Michael Bozzuto, chairman, president and chief executive officer of Bozzuto's, said of Ancona, "He is a mentor and helped shape the lives and careers of many, from his sons to general manager to people both in and out of the industry. He has led by example, shared his knowledge and wisdom. He gives the best he has got, and has learned those things from his father."

In accepting the award, Ancona recognized the next generation. He said he expects the third generation will keep Ancona's going strong over the long term.