VONS TO INSTITUTE INITIATIVES TO LOWER COSTS

ELLIOT ZWIEBACH

ARCADIA, Calif. -- To reduce costs without compromising customer service, Vons Cos. here has developed a menu of "quantifiable value initiatives" that it plans to introduce this year.

The efforts provide "a framework for how the company will improve its operations and meet its obligations to shareholders, associates and the communities it serves," according to the chain's annual report.

In-store service initiatives include adding wine stewards -- where customer demand is sufficient -- at some of the 40 Vons stores with fine wine programs; continuing to give free-merchandise certificates to customers whose purchases reach certain electronically tracked spending levels; and testing a crusty bread program introduced at Pavilions last year at selected Vons stores.

Vons also aims to bolster private label, with a goal to raise its portion of sales to 22% this year from 17% in 1995.

In the area of technology, an information-driven support system that tracks scanned purchases, advertising and promotions will be used to help improve in-stock conditions and reduce store inventory. The system is expected to provide stores with more timely access to product movement on a store-specific basis.

Furthermore, Vons plans to upgrade systems so category managers can track product movement vs. industry data by highlighting products and categories where Vons may be underpenetrated. The enhancements are expected to help achieve more efficient assortments by reducing the number of products offered without affecting customer satisfaction.

Check readers also will be installed at all stores this year in order to review accounting histories by scanning customer checks against a database.

Other initiatives include the following:

· Continuing to offer a companywide job-posting system and a tuition reimbursement program to enable associates to improve their career advancement opportunities.

· Introducing an extensive work-safety program to improve the work environment by reducing accidents and helping to reduce Vons' worker compensation costs.

· Continuing to provide each store with a donation budget to support community activities.

· Providing cash grants to college groups to encourage voter registration and naturalization.

In the annual report, released last month, chairman and chief executive officer Lawrence A. Del Santo said, "The real difference in our stores is the commitment of our associates to customer service. We believe it was the single biggest contributor to our success in 1995.

"As we continue to emphasize customer service, we are aware that it comes with the price tag of additional store labor. We recognize that to remain competitive, we must be diligent in our search for ways to reduce costs and increase efficiency."