STATER BROS. SETS SIGHTS ON SERVICE

MATTHEW ENIS

COLTON, Calif. -- Riding a surge in sales growth, Stater Bros. Markets here is working to cement its image among consumers as a leader in fresh service departments.

"Folks go to the supermarket for service," said Jack Brown, chairman, chief executive officer and, until recently, president of the 159-store chain. "They may go to a box store to buy something by the case, but when they come to a Stater Bros., we talk about full service because there are people there to help them in all of the service departments."

Since February 2003, when the company launched its "We Believe in America" expansion campaign, it has opened eight new stores. Two more stores are currently under construction, and 38 have been completely remodeled. With almost 1,900 new employees, the chain appears ready to fully support an updated look that highlights the superior service it prides itself on.

Each of the new 44,000-square-foot stores offers full-service meat and seafood departments. Officials said it's the company's meat that made it famous. Brown said the company's staff of experienced butchers continue to remain an important point of competitive difference.

"We're the only chain in the area that still has full-service meat counters," said Brown. "And 65% of our meat is selected one piece at a time by our customers. We also have self-service meat, but the unique thing about our program is that the price-per-pound for full-service meat is the same as self-service."

The expanded "Garden Fresh" produce departments in the new stores feature more than 500 items. Brown added that keeping associates working on the floor in the departments allows the company to fulfill special requests.

"There are always people working on the floor in the produce department," he said. "We have about 80 more items than the average chain would have, but customers can ask for special orders as well, if there's not room to bring something into the set."

Hot service deli departments offer customers prepared meals, salads and the Stater Bros. "Sandwich Classics" brand, featuring artisan rolls from La Brea Bakery, Los Angeles.

A variety of party trays are made daily at each store's deli and bakery, and full-service floral departments offer fresh-cut bouquets, silk arrangements, potted plants and balloons.

Although he explained the company's efforts in terms of being a better retail competitor, Brown revealed the motive for launching the "We Believe in America" campaign wasn't entirely geared toward solidifying market share or fighting off the impending growth of Wal-Mart in the region.

"Back in early 2003, President Bush asked everyone to do what they could to improve the economy," he said.

"I met with our executive staff and said that everything can't be done in Washington, something has to be done right here at home. "We decided that we, as a company, wanted to do what we could do."

The company's timing proved fortuitous later in the year, when, according to Brown, 100% of Stater Bros.' employees voted not to participate in the strike-lockout that for five months hobbled most other chains in Southern California's supermarket industry.

Stater Bros. has continued to benefit from customers gained during that period.

Same-store sales were up 36% through the first three quarters of the fiscal year ended in June. Brown told SN in an earlier interview that Wal-Mart's first supercenter in California, which competes with two Stater Bros. locations in La Quinta, hadn't caused any drop in sales at the stores, even during the supercenter's grand opening.

To thank the staff, Stater Bros., one week before the strike's end, distributed $7 million in bonuses throughout its 16,000-member workforce "as a way of saying thanks to their terrific effort," said Brown.

Cultivating good relationships with employees is critical, Brown said, since the store-level employees are the face of the company for its customers.

Extensive staff training and a promotion-from-within ethic have become crucial components in the company's efforts to maintain its standard of service.

"We're second to no one in the amount of training we do," said Brown. "We have our own training center where we train all of our courtesy clerks.

"Most of our executives, including myself, started out bagging groceries, so we have something in common with our newest employees. We know what it's like to be on the front lines, working with customers."

Noting that associates create a more personal experience for customers, Brown added, "There's no question that the customer builds a relationship with the people they see every time they come in to shop.

"For example, when we acquired 43 Albertsons stores in 1999, we received within a few weeks more than 800 letters from customers. Every letter mentioned one, two, sometimes three people in a store.

"They all said how happy they were that we had kept their favorite employees."