SAFEWAY RESET OF BAKEWARE AIMS TO IGNITE AUTUMN SALES

JOEL ELSON / Additional reporting DAWN HILL

PLEASANTON, Calif. -- In time for the fall baking season, Safeway here has completed remerchandising its bakeware sections at most of its divisions.

Safeway, the second-largest supermarket chain in the country, began implementing new shelf schematics chainwide in June. New 4- to 6-foot bakeware sets were planogrammed under a new bakeware category management program from Bradshaw International, Santa Fe Springs, Calif.

The Seattle division will reset bakeware departments next spring, while Vons, Arcadia, Calif., has slated new sets for all stores by Oct. 1, said Jeff Megorden, marketing manager at Bradshaw. Safeway executives had no official comment on changes made in the bakeware category, which also involved a shift in vendors from Ecko Housewares, Franklin Park, Ill., to Bradshaw.

Better known for supplying kitchen tools and gadgets to supermarkets, Bradshaw is a relatively new player in bakeware with only 15 months of shipping products. It began building category management programs in bakeware for retailers this year.

Safeway is hoping the resets will boost department sales 10% to 20% in the first year, said Megorden.

The revamping has upgraded Safeway's 35-item bakeware assortment, with retail price points running 50% to 75% higher on some items, said Megorden. Previously, roughly half of Safeway's metal bakeware department was low-end promotional tin items, he added.

The chain has replaced many of the tin-plated items with Bradshaw's Oven Fresh nonstick and Air Perfect insulated bakeware. These items will account for 70% of department sales.

Price points overall now start at $1.49 for a low-end tin loaf pan and go up to about $12.99 for a large insulated cookie sheet. Retails previously ranged from $1.49 to $9.99.

"The bulk of the nonstick bakeware business comes from products priced at the $5.50 mark," said the vendor. Safeway operates its bakeware on 50% margins, according to Megorden.

While still offering some tin-plated items as opening price point options, the infusion of better grade bakeware allows shoppers to trade up, Megorden explained.

In the case of Safeway's Eastern division based in Lanham, Md., however, the resetting involved basically the change in brands. Nonstick selections were offered all along, an executive in the division who asked to remain anonymous told SN.

"We had a lot of positive reactions to the new brand from our customers during tests," said the executive. In the brand switch the division pretty much kept its existing price points, and this hasn't been an impediment to sales, he pointed out.

"We've carried the pricier coated products almost exclusively for our primarily higher income Washington, D.C. region customers all along," said the Safeway executive.

At Safeway chainwide, as well as at other retailers across the nation,"consumers seem willing to spend another $1.50 or so for a better quality bakeware item if it's easier to clean," commented Megorden. He said research shows 70% of consumers want nonstick bakeware.

According to the supplier, bakeware volume reacts heavily to fall promotions, especially to off-shelf displays. Safeway plans to ratchet up impulse sales in the category with a 25% increase in promotional activity, including using cents-off offers, special endcap displays and floor stands.

For example, Safeway's San Francisco division has slated a one-third off sale this fall for all bakeware as part of its coupon book promotion.