HOUSE OF PLENTY

ROSEANNE HARPER

SANTA BARBARA, Calif. -- Lazy Acres Market is anything but.

Indeed, its organic produce and fresh, prepared foods -- including organic pizza and grilled tofu -- have helped keep sales growing at such a clip that the single-unit, natural foods supermarket is currently looking for a second location. Its on-site kitchen team began last month to work 'round the clock to keep up with demand.

The deli and the produce department each contributed more than $3 million to Lazy Acres' total $26 million in sales last year, one of the market's owners told SN. What's more, the 28,000-square-foot store did all that selling in the shadow of an Albertson's across the street and a Ralphs a half mile away. Costco is in the neighborhood, too.

"When Ralph's moved in a few months ago, it made no impact at all on our sales. Sure, our customers went over there to check it out, they didn't stay. What's important is that they're back," said Jimmy Searcy, a co-owner of Lazy Acres.

Such fierce loyalty has fired sales all along and prompted the owners to expand the store from 8,600 square feet to its present size four years ago. At that time, the company's success grew, too, with the opportunity to add variety and improve presentation, Searcy said. A newly introduced salad bar with 50 items, most of them organic, has become one of the store's best performers. And an already-successful, prepared-foods program wows customers with a colorful presentation in an 18-foot service case.

"We felt we needed a 25% increase in total sales pretty quickly to justify the expansion, and we got a 50% increase," Searcy said.

Lazy Acres' director of prepared foods, Paul Shields, formerly a sous chef at a well-known resort nearby, joined Lazy Acres Market before its expansion, and now he often hires local restaurant chefs to help out on a part-time basis.

Shields, a certified chef, delights in the fact that he could more than triple the variety of foods prepared on-site after Lazy Acre's expansion. Some of the additions clearly are destination items, "like our fire-roasted, tricolor peppers and oven-roasted beet salad. I brought that recipe with me from the restaurant. We had served it as a side dish with lamb shanks. Our team here thought up the beet salad. They're both big sellers," Shields said.

"Oven-roasting the beets brings out the sugars, and we use a maple vinegarette and mix in corn and spinach for color -- all organic."

The fire-roasted peppers and the beet salad are priced at $7.99 and $6.99 a pound, respectively.

Shields pointed out that with Lazy Acres' addition of space next door, the kitchen was expanded from "miniscule" to 800 square feet.

"We went from six burners and one little oven to 12 burners, six convection ovens, stock pots and a wood-burning pizza oven we imported from Italy."

The wood-burning oven turns out another of Lazy Acres' destination products -- margherita pizza, which features fresh mozzarella and organic tomatoes and basil.

"We use the oven for other things as well, like tamari chicken and our calzones. Even one of the salad-bar items: oven-roasted lentils," Shields said.

Prepared foods, for the most part, are chilled and displayed on various-shaped platters in an 18-foot service case. A 6-foot hot case offers 14 items a day. While 85% of sales are for takeout, a 60-seat cafe accommodates customers who want to eat in the store.

"Altogether we sell 8,000 to 10,000 pounds of prepared food a week," of which nearly 1,000 pounds are prepared tofu, he said. At $3.3 million in sales a year for the deli -- which includes prepared foods, the salad bar, traditional deli and a grab-and-go case -- "we're doing better than the average restaurant in town," said Shields, who speaks with enthusiasm about his job at Lazy Acres.

He said he wouldn't have left the restaurant industry to work for a traditional supermarket.

"This is different. First of all, we make everything from scratch -- as much of it from natural ingredients as we can -- and it's also a nurturing environment here. Everybody's ideas are given consideration," he said.

That environment could account somewhat for the fact that the store gets high marks for customer service.

"I'd say that more than 90% of comments we get from customers are about our people. How sweet they are," said Searcy.

To help ensure that he'll have an amiable crew of associates, Searcy takes particular care in hiring them and in compensating them for their work.

"We interview 500 people for every 50 we hire. We're just very careful, and we make them our partners. We take 10% of pretax profits and divide them up among our employees, part-time as well as full-time," Searcy said.

Associates also are trained to help customers find what they want. If customers are staring at an item they're not familiar with, associates will walk over and take the opportunity to talk about the product, said John Odahara, Lazy Acres' produce director.

"We might see them puzzling over something like a Buddha hand, [and] we'll go over and explain what it is and what it's used for. Tell them it's a citrus item, an organic one, and used mostly for its zest. It's an odd-looking thing. It's not a new fruit, but it is new to the market," Odahara said.

This focus on customers, plus competitive pricing, adds up to produce sales of $70,000 a week. Even with more competition like Ralphs and Costco moving into the area, Lazy Acres' produce department saw nearly 3% growth last year.

Organics make up 70% to 75% of the produce mix of more than 300 items, and Odahara and Searcy take particular pride in the fact that they can sell organics competitively.

Odahara explained that strategic pricing of produce items is a major key to Lazy Acres' sales success because it attracts attention, brings in new organics customers, and attracts mainstream grocery shoppers who might have had the perception that organics or all-natural products are too expensive.

"The lettuces -- red leaf, romaine, all of them -- are right at the competition's price or below. I like to price that way because it appeals to the consumer who has never thought of buying organics. It can bring people in. It may sound funny, but I know when we have attracted mainstream grocery shoppers when sales of iceberg lettuce go up, because usually we sell very little of that type of lettuce."

In an ad circular last month, certified organic celery and certified organic baby carrots were advertised at prices that were comparable to those at nearby traditional supermarkets. Celery was 99 cents a bunch, and baby carrots were $1.49 for a 16-ounce bag.

"Since Sept. 11 people are more frugal. I've seen increased ad item movement since then," Odahara said.

While Santa Barbara itself is a high-income town and Lazy Acres Market lies between the ocean on one side and a high-end residential area on the other, and draws a mixed clientele.

"In the parking lot you'll see Rolls Royces and Mercedes parked alongside Honda Civics," Searcy said.

College students are part of the customer profile, he pointed out. There is a Santa Barbara city college less than a mile away, and the University of California at Santa Barbara campus lies just five miles down the road. Customers come from farther away, too. An outside consumer survey that Lazy Acres commissioned showed that many customers drive past two markets on their way to Lazy Acres.

The way it purchases its produce helps Lazy Acres keep its prices competitive, Odahara said. About 70% of its produce is bought directly from growers, eliminating the cost of going through distributors.

"That is key, I think. And growers are very cooperative, even though we're a small company. We're not taking whole truckloads."

Suppliers may be influenced by Jimmy Searcy's determination to be a good customer. He was on the supplier end of the food business before he and his partners, Irwin Carasso and Hugo Van Seenus, launched Lazy Acres Market 11 years ago.

"When I was a distributor I had a very definite idea of who the good customers were. They were nice and they paid their bills on time and that's what we strive for."

When they started out with what was then thought of as a health-food store, Searcy and his partners didn't expect to expand to such a large store as they have now. Now, they're looking for an even bigger site, also in the northern part of Santa Barbara, as a second location.

"Ideally, we could use 35,000 to 40,000 square feet. We would definitely expand our prepared-foods area, especially the grab-and-go case. We're just constantly restocking that all day long," Searcy said.