NATURE'S STORY

MINA WILLIAMS

LAKE OSWEGO, Ore. -- The Nature's Northwest store opened here by General Nutrition Centers takes its produce mission seriously, and wastes no time in presenting freshness and variety -- produce leads off the store's fresh power aisle.

"These areas build our icon for freshness," said Stan Amy, president of the Pittsburgh-based company.

According to Amy, the purpose of this prototype -- the first in what is expected to be a chain of GNC-operated stores -- is to serve as a proving ground for new retail concepts, including produce.

Nature's Northwest executives say the store has adopted a number of new operating techniques that set it apart from other retailers.

"We are very proud of how we are presenting produce at the new store," said Brian Rohter, vice president and general manager. As customers walk up to the store, they are exposed to the whole receiving process, which in traditional stores takes place in the back room. Boxes arrive and are unpacked just inside the doors as workers prepare the items for sale.

"We turned our process inside out, we have nothing to hide from how we process produce to how we make sausage," said Amy. "Being close to the source is one concept with which we align ourselves." The operator uses this strategy as part of its marketing of produce. "We let them see the process. We let our customers in on the process of bringing fresh food to their tables.

"We may not have the largest displays, but we have the most flavorful," said Amy.

What can't be accomplished through action is presented visually. Within the department is a 30-foot-high charcoal-style mural depicting fresh farm fields. Four rear-projected slide screens project photos of the store's growers on the mural, giving a face to the items on display.

To maintain this flavorful image Nature's Northwest has relied on relationship buying. "We can create a differentiated market that way and, recognizing the value of this method, develop partnerships," said Rohter.

To procure the right mix, Nature's Northwest dispatches two tractor trailers twice a week that start up the Pacific Coast from southern California growing regions. One maintains a course up the coast, another travels up the I-5 corridor. Stops are made to pick up produce, direct from growers, at regular intervals.

As a natural-food purveyor, Nature's Northwest offers a large organics section, ranging between 40% and 75% of the produce stockkeeping units, with the greatest variety available toward the end of the year. Customers are apparently pleased with the mix, since organics comprise 60% of department sales, according to Rohter.

"There is more demand for organics and there are more growers participating," he said, noting that items exhibiting the best flavor are the centerpiece of the department. "Our customers say that our availability of high quality and organic is what has hooked them on the store."

By fostering relationship buying, Nature's Northwest has moved into a new area of produce procurement and has forced some rethinking of how the department functions, operationally, according to officials.

"We have to move produce out of the commodity mentality," said Rohter. "We are interested in decommodifying produce and have changed our fundamental approach in demonstrating a willingness to deal with a greater amount of complexity because we are interested in specialty goods."

The shift in thinking has produced rewards at the grower level, said Rohter. When growers are producing with a commodity mind-set there is a loss in the craft of farming and in pride of quality. If crop value is defined by price alone, the craft aspect is lost, he said. "We make it possible for growers to focus on quality, high quality."

Benefits are also evident within other perishables areas including the meat, seafood and dairy departments. Amy said that relationship buying principles have been implemented in these departments to keep quality and flavor profiles at a level that Nature's Northwest customers have come to expect and pay for.

"Relationship buying gives us just another way to tell the story," said Amy. "Story-telling is the backbone of our market. It gives customers an emotional connection and a tidbit of knowledge. Our suppliers have put us in the position of sitting on a gold mine of stories."

With 55% of its customers having some college education, Amy said his customers see education and information as a part of life. "They want information and feel we can give it to them."

"We share information with our customers," Rohter agreed. One of the methods Nature's Northwest uses to expand shoppers produce horizons is through horizontal tastings. The operator uses these demonstrations to help consumers determine why, for example, some sorts of lemons are better tasting than others.

"The era of the empowered consumer is just starting. We have the luxury of dealing with 20% of the market," said Amy, referring to the estimated number of shoppers who select natural food. "I think it can be as big as 40%."

It is this growth, in response to consumer demand, that Amy believes places independents integrating natural foods into their mix in a good competitive position. "It gets challenging for conventional operators when they add the Top 20 movers to meet the needs of the customers.

"Then, there is complexity vs. efficiency. Efficiency requires simplicity of the systems and uniformity in characteristics. Using these principles, retailers do not always build around quality, so there may be a choice on what the focus is.

"Independents have an opportunity as we face the efficiencies in mega merchants," he said.

The prototype unit has given the produce department additional space to execute these marketing missions. "Now we can really show our stuff," said Amy, referring to the flavorful variety, picked ripe and grown from healthy soil.