FOOD STORES TRYING ON WOMEN'S ACCESSORIES

CHRISTINA VEIDERS / Additional reporting: MATTHEW W. EVANS

MOUNTAIN LAKES, N.J. -- Four Independents in New Jersey and Pennsylvania have broken ranks with traditional grocery retailers in testing a women's fashion-accessory concept under the name Sera.

Supplied by Vector Logistics here, Sera (meaning "it will be") is merchandised as a permanent in-and-out display containing between 225 and 475 stockkeeping units of fashion accessories. These include jewelry, handbags, small leathergoods, sunglasses, hair accessories, gloves, hats, scarves, umbrellas, socks, sandals, stationery, watches and gifts. Most Items retail between $5 and $40, with the average sale in six test stores reportedly running $14.

The merchandise is displayed on an attractive moveable, wooden fixture with recessed lighting. The presentation reflects the look of a department-store presentation and can be configured on 4-foot display modules either in-line or as an end-aisle or island display. Currently, SN confirmed that four retailers have been testing the fashion-accessory line for about a year. Retailers in New Jersey are Wolfson ShopRite in Lincoln Park, Marrazzo's Thriftway in Robbinsville, and Super Foodtown in Wanaque.

Also, Gerrity's Supermarket, a nine-unit operator in Scranton, Pa., placed a 4-foot by 8-foot island with two endcaps in a store in January. The display is positioned up front near bakery for security reasons, said Jeff Smith, the manager of the Luzerne, Pa., store that is testing the boutique.

"It's a tough thing in a grocery department. But it does sell and they are within what they expect to sell," Smith commented about sales to date.

At Super Foodtown, a store-within-a-store leased-space arrangement has been in place for about a year. "Sales have picked up for the summer," said Dave Rosen, vice president and general manager of Fairview Partners, based in Wayne, N.J. Fairview recently acquired the location from another independent. Comparing it to a store that you might see in an airport, he estimated that the 1,000-square-foot section could account for up to 8% of the store's general-merchandise business. "It will be an interesting category," he added.

Interviewed at the General Merchandise Distributor's Council GM Marketing Conference in Orlando, Fla., last month, Vector Logistics president Michael McElduff said the biggest obstacle in getting placement has been the fact that "it's never been done before," especially in a supermarket environment.

Through the branded Sera line, McElduff is attempting to introduce a non-traditional category into the food channel. According to research presented by Vector Logistics, supermarkets currently generate less than 2% of the $23.5 billion sold in women's fashion accessories. McElduff predicts that fashion accessories sold in supermarkets can double over the next five years, reaching $1 billion in annual sales.

In attempting to capture the fashion-accessory shopper, McElduff says, the supermarket shopper and fashion-accessory shopper are the same. "She is purchasing from various stores, depending on which best fulfills her specific needs of value, selection and convenience, " he said. With the proper selection of goods, attractively displayed at the right price, McElduff said, test stores are demonstrating that shoppers will buy fashion accessories in the supermarket.

McElduff compares accessories to greeting cards in terms of volume and profitability. Annual sales in the six stores currently testing the concept are projected at $877 in average weekly sales, yielding an average weekly gross profit of $307, or a 35% gross margin. Fashion accessories appear on par with other general-merchandise categories, according to statistics compiled by Chicago-based Information Resources Inc. for large combo supermarkets with total sales volume of more than $20 million. Batteries, for example, generate $950 in average weekly sales, yielding an average weekly gross of $238, or 25% gross margin. Light bulbs generate $830 in average weekly sales with the retailer making $324 in average weekly gross, or 39% gross margin.

With many supermarket chains expanding their genera- merchandise offering to better appeal to consumers likely to shop across various channels, and compete against mass merchandisers that are now selling food, McElduff said he believes supermarkets can break through as a legitimate channel for women's fashion accessories. "It's a high-visibility product category and can help attract the mall shopper," McElduff added. It also gives supermarkets a defensive position against mass merchandisers who are aggressive in stocking food, he noted.

The merchandise is direct-store delivered and vendor serviced and managed. Stock is constantly changed according to the season. Sales are guaranteed with 45- and 60-day terms on orders.