DEEP IN THE HEART

BARBARA MURRAY

The stratified and growing Dallas/Fort Worth, Texas, market is served by diverse supermarkets that range, cost-wise, from the new Wal-Mart neighborhood format to EatZi's, which specializes in prepared meals.

About 100 independent grocers were given an insider's tour of some of the region's supermarkets in conjunction with the National Grocers Association convention, held in Dallas earlier this year. The tour, led by several executives from Fleming, took two groups to the Wal-Mart, a Super Target, a Hispanic-format Danal's and the Flagship Tom Thumb.

Average sales per week ranged from $200,000 at the Super Target, which Fleming supplies, to $423,000 at the Tom Thumb, according to the tour hosts.

According to brochures provided by Fleming, the DFW market has a population of 4.3 million that is growing at an annual rate of 1.8%. The average household has 2.6 persons; median household age is 32.5.

First stop for the first tour group was the Wal-Mart Neighborhood Market store in Garland, Texas, one of seven Neighborhood Markets open in this region. On a Monday at about noon, the store was not crowded, and SN's first impression was that of clear, free space; an open plan, with produce being the first thing a shopper sees and dairy located to the right. This store, on Broadway Boulevard and Wynn Joyce Road, is open 24 hours.

"This is much smarter than the Supercenter," said Carolyn Claiborne, a retailer from West Texas and owner of Claiborne's Thriftway in Lamesa, referring to the smaller format, which contained no apparel to distract shoppers from food sales.

"We're really afraid of these. Everybody is, because their funds are unlimited," she said. The Claibornes were among a group of about 45 on one tour.

Actually, the Neighborhood Market is more of a threat to major chains than to independents and small chains, according to David Rogers, president of DSR Marketing Systems, Deerfield, Ill. According to Rogers, a retail research consultant and a workshop presenter at the NGA convention, supercenters are the more important issue for independents, "because they are focused on rural areas, where they have become the 21st century's general store."

Produce in the Garland store was geared toward the Hispanic shopper, observed Steve Gregg, an account manager with distributor Cyclone Enterprises, Houston. "Hispanic has not been Wal-Mart's niche, but they are getting into it," he said. He also noticed the pricing -- items marked 2 for $3, or 3 for $5; Ocean Spray cocktail at $2.88; and V-8 Splash at 75 cents. "They're getting away from the nines," Gregg commented.

A refrigerated case labeled Mexican Foods was in the midst of dry grocery aisle number two, signed "Mexican" and placed next to grocery products such as Maseca flour and strong-smelling Spanish laundry detergent, which was spilling over onto the flour shelf from some broken plastic bags.

The cold case held Calidad pre-made gelatin desserts; Crema Mexicana, a soft, white cheese; chorizo pork sausages; and Masa pre-mixed dough, among others. On the shelf next to it were Knorr dry mixes and Mole Mexican condiments, Dona Maria brand, $1.98 for 8.5 ounces. Nearby were Goya canned beans, as well as La Moderna spaghetti and elbow macaroni, 24 cents a package.

Elsewhere in the store were an endcap of PepsiCola featuring 12 cans for $2.50, and Pampers, "super mega" size, 84 diapers for $20.97. Red shelf-talkers in the baby aisle said Wal-Mart would match any competitor's ad, but not "gimmick promotions," such as percentage discounts or double and triple coupons, both of which were being offered at the nearby Tom Thumb store. The baby aisle had four feet of Gerber foods priced at 33 cents per jar or 3 for 99 cents; four feet of Heinz at 38 cents a jar; Gerber meats, 72 cents; and Gerber Tender Harvest, 58 cents a jar. Gerber Graduates were 3 for 99 cents, or 58 cents each on certain stockkeeping units.

The Wal-Mart Neighborhood Market is the newest supermarket entry in the DFW area. Seven units are open here and another seven planned for this year. The stores here are slightly larger than the original units opened in Arkansas and Oklahoma, Fleming noted, and have taken on a warehouse look, with concrete floors and open-beam ceilings.

The DFW area has added 800,000 people in the past 10 years, Ferren said. "There was not a parking place to be had here on Saturday," he said of the Wal-Mart. Fleming estimated that the average 50,000-square-foot Wal-Mart Neighborhood Market unit generates $200,000 in weekly sales. "The Neighborhood Market is Wal-Mart's attempt to capture the one- or two-person household," said Gregg. "That's what these people are so nervous about, that Wal-Mart is going to capture every segment."

The Super Target in the Pavilion City shopping center in Plano was the next stop. Inside, the Super Target Archer Farms Market had grocery aisles with some unusual touches. An endcap for the white-packaged OAO organic line created by Philipe Stark caught everyone's attention.

The condiment aisle had helpful signage explaining four mustard types -- stoneground, flavored, yellow and dijon. This classroom placard technique was carried out in other aisles, too, defining various kinds of rice, beans and sauces, such as bearnaise and au jus. Super Target got high marks for its signage, which also included vertical shelf talkers that read "Natural" hanging down over four shelves.

Best Yet, Fleming's private label drinking water, was featured at 59 cents a gallon, but in general, Super Target was judged less aggressive than the Wal-Mart by the tour group.

Super Mercado Danal's, the next stop, traces its history to Food Lion, which owned stores in this market but has left. Fleming bought several, and one operator, Eric Eidson, bought one and christened it Danal's, then added two more, all within Dallas. All have a courtesy booth, at which customers can send money to Mexico, and all have bright decorations, like colored-foil fringed streamers, and salsa music playing. The store visited, on Spring Valley Road, is 31,730 square feet and has average weekly sales of $206,000, the NGA booklet said.

Bright-yellow circulars advertised the week's specials, including Brawny paper towels, 77 cents a roll; Reynolds Wrappers, 50 count for $1.69; Capri-Sun drinks, a 10-pack for $1.99; and Kraft salad dressing, 16 ounces for $1.78.

A large display of Best Yet canned corn offered 4 for $1, and noted that this year is the 107th anniversary of the private brand.

An endcap of Maseca instant corn mix featured a price of $1.58 for a four-pound bag.

Tom Thumb operates 68 stores in the DFW metro area. Described by Fleming as an upscale, service-oriented chain offering a wide variety of service and specialty departments, it promotes its "Reward Card" program. Average store size is 49,000 square feet, and average weekly sales per store are $423,000, according to the information provided to tour members.

The Flagship Tom Thumb, as it is called in its store circular, has an attractive wine section that also offers bar accessories. Wine is signed by type, such as Merlot and Chardonnay. There was a big selection, ranging from box wines to upscale bottles.

The second tour stopped at EatZi's Dallas, at 3403 Oak Lawn Ave., a five-year-old store of 8,000 square feet with sales of $250,000 per week, mostly in high-quality perishables, specialty meats and cheeses, and French bakery items.

Center Store products are responsible for only about 5% of sales, general manager Neil Neufeld told SN after the tour. "We definitely are pushed by specialty and abundance, and although we obviously can't be as competitive, we shop Whole Foods to make sure we keep our price point within that realm."

In Center Store, Neufeld said, "We are constantly shopping food shows for new products, and we keep an eye out for our supermarket competitors. The brand is important, what's in it. We try to stay with natural ingredients. We do carry private label: five kinds of oils, six different kinds of jellies, and a couple of mustards, all under the EatZi's label. All the shelving is light wood, and all the products are displayed in normal waterfall stacking," Neufeld said.

DALLAS-FORT WORTH MARKET

Population: 4,273,815 (4.8 million according to Spectra, Chicago).

Population Trend: Increasing 1.8% annually

Household Size: 2.6 persons

Median Age: 32.5 years

Per Capita Weekly Expenditure: $34.75

Weekly Supermarket Potential: $148,515,071

Average Sales per Square Foot: $7.12

Major Competitors: Albertson's (92); Tom Thumb (68); Kroger (64), Wal-Mart Super Center (20) Neighborhood Market (7) and Sam's Club (14), Winn-Dixie (46), Minyard's (81), Whole Foods (6), Brookshire's (23), Fiesta Mart (6) and Costco (2), according to Spectra data.