J-HOOK PROGRAM YIELDS STRONG GADGET VOLUME

JOEL ELSON

Several major chains have instituted a new J-hook program of branded gadgets that is producing strong incremental sales and higher profits.

Lucky Stores, Dublin, Calif., Hughes Family Markets, Irwindale, Calif., Ralphs Grocery Co., Compton, Calif., and the northern California and Denver divisions of Safeway, based in Oakland, Calif., are among the chains that have implemented the program, ac-cording to trade observers.

A uniform branded line with items packaged on a small card is what distinguishes this merchandising program from how the chains have traditionally J-hooked such merchandise.

In the past, supermarkets J-hooked such gadgets from various manufacturers with products often packaged on cards in larger sizes, and different colors and shapes. The larger carded products tend to block grocery products on the gondolas.

General merchandise executives told SN that the smaller card size takes up less space on display gondolas and racks, and makes it easier for stock clerks and night crews who pack out grocery shelves.

"You can see the products stacked behind on the gondola shelf clearer than the gadgets packaged on larger carding," said a buyer for Lucky Stores, who asked not to be identified.

Lucky Stores, an American Stores subsidiary, has started shifting its J-hook gadgets over to a single branded line, which it envisions will lead to higher impulse gadget sales.

"A branded J-hook program spurs impulse movement although this program is too new yet to measure anything. But we

feel the uniform look together with the smaller card should upgrade that whole program," the buyer added.

The branded line of 300 stockkeeping units, supplied by Bradshaw International, Santa Fe Springs, Calif., includes kitchen tools and implements, automotive supplies, baby utensils, straws, pet accessories, toys, pot scrubbers, brushes and sponges.

Ralphs also has replaced its former J-hook program in favor of a single brand of gadgets, confirmed a company spokesman, who declined to comment further on the program.

However, a source familiar with the chain said, "Ralphs feels the branded selections create a better identification for gadgets cross-merchandised at grocery and other aisles."

"Ralphs is running it chainwide and is pleased with sales. Part of the reason they put it in is the smaller cardboard backing, which doesn't cover up as much product on the shelves."

Smith's Food & Drug Centers, Salt Lake City, is exploring the idea of taking on the branded J-hook gadgets line, and replacing its current program of a mix of merchandise from a number of manufacturers under a variety of labels, said an industry source.

Smith's officials declined to comment.

West Coast retailers using the program "are finding the branded J-hook mix is very visible and high impulse," said a source familiar with the retailers' housewares.

According to the source, the retailers are realizing about 25% to 30% of gadget sales from the branded J-hooks at around a 10% higher profit than the regular gadgets. The in-line section generates 35% to 40% of gadget sales, and about 25% of sales come from promotions.

Top-selling items for the retailers are can openers and 100-count packages of straight and flexible-joint straws, retailed for 79 cents to 99-cents, according to local observers.

"Straws are a commodity item and highly consumable and impulsive, and they are normally not on the shopping list. Hair brushes, balloons and some toys, and feather dusters, all selling for under $3, are doing well at the chains," a local observer said.

Associated Wholesalers, York, Penn., is implementing the program "to create brand consistency and stronger identity for J-hooked gadgets," said Charles Yahn, vice president of general merchandise.

Yahn said the branded program offers retailers an 8% higher margin than the same or similar gadgets merchandised at the main gadgets section.

Associated is rolling out the program to some 250 supermarkets. The rollout follows a limited test of the items at a group of 10 stores in December and January.

"While some of the items may duplicate the mix at the regular gadgets department, we're getting that unplanned purchase from gadgets out on J-hooks and clip strips," added Yahn.

"In smaller carding, the products stand out against the multicolored background of grocery items where larger carding blocks off excessive amounts of space in front of grocery products. The uniform card size and label give the gadgets a brand look customers can easily recognize as they move around the store," he added.