CARR GOTTSTEIN SWITCHES PRIVATE-LABEL TO POWER NONFOOD SALES

JOEL ELSON

ANCHORAGE, Alaska -- Carr Gottstein Foods here projects 10% to 15% increases in private-label nonfood sales with the chain's shift to the Springfield brand.

Carr's move to Springfield for health and beauty care products and general merchandise calls for shelf sets in the new offerings to be completed at store level by next week.

Preliminary results since Springfield items began appearing on gondolas this spring indicate "there's been great acceptance, and we're very pleased," said Gary Schloss, vice president of general merchandise.

Carr's Springfield nonfood mix contains some 400 items, with 80% in HBC and the rest in general merchandise selections. Carr's grocery department also offers the Springfield brand, which is supplied by Certified Grocers of California, Los Angeles.

The chain's previous private-label program was supplied by Topco Associates, Skokie, Ill., with groceries under the Food Club label, Top Care for HBC items and Top Crest for general merchandise products.

Under the line change, Schloss said, nonfood variety is to remain basically unchanged, although stockkeeping-unit choices in some HBC categories are being enlarged to broaden sales in the store brand.

"We expanded individual SKUs in multiple sizes to go after more sales in HBC," he said. "Where we used to have a single size in a 50-count store brand ibuprofen, it's now offered in three sizes, including a 100- and 150-count to take advantage of the growth potential certain commodity groups represent.

"We're going for larger-count sizes in several categories, including the cough-and-cold category," Schloss continued. "Springfield allergy tablets are going into an added 24-count pack size in addition to the 12-tab package, and we're picking up an 8-ounce cough syrup besides the 6-ounce we had."

Carr's ultimate goal "is to give as much visibility as possible to the new Springfield brand. We're going to really push that label," he noted.

He said gross-profit margins for private-label HBC run around 25% to 50%, compared with 8% to 20% for national brands. He had no comparisons for general merchandise.

According to the Carr executive, "private label is becoming more important as the market has become so competitive in national brands over the last year or so. With the Wal-Marts and Kmarts in town, we have no alternative than to offer our customers the option of private label in wider SKUs."

The chain plans to unleash a campaign to introduce the Springfield nonfood items with a big splash in newspaper ads and store circulars this fall.

To acquaint store managers and department heads with the Springfield program, Carr assembled general merchandise and pharmacy managers to review the product lineup this summer.

"They could really see that in the Springfield line, compared to national brands, there's not much difference, especially in cough and cold, which is all regulated by the government," Schloss explained.