TIDYMAN'S AWAITS SAVE-A-LOT DC BEFORE EXPANDING WITH NEW BANNER

Elliot Zwiebach

SPOKANE, Wash. -- Tidyman's here hopes the Save-A-Lot stores it intends to open will solidify its position in existing markets, Mike Davis, president of the 14-store independent, told SN last week.

Davis said he's looking for potential Save-A-Lot sites, although any further development will depend on Supervalu's success in finding a location for a Save-A-Lot distribution center in the Pacific Northwest.

Minneapolis-based Supervalu, which owns a 40% stake in Tidyman's, owns the Save-A-Lot name and licenses the stores to independent operators. The Save-A-Lot stores are supplied through a separate distribution network than the one Supervalu uses to supply its traditional independent customers.

Davis said he sees opportunities for Save-A-Lot's extreme value format in areas surrounding Tidyman's primary marketplace in urban areas of eastern Washington, Idaho and Montana.

"Right now we're trying to gauge the market potential to determine how many Save-A-Lots we might open, and our initial assessment indicates between three and six, depending on our ability to find sites in the Spokane area," he said.

Tidyman's 14 stores account for sales of approximately $150 million. Over the last 15 months the company closed seven unprofitable locations -- three in Montana, three in Idaho and one here -- that accounted for about $45 million in sales, Davis said.

"Those stores had little potential for growth without substantial reinvestment," he noted, "whereas closing and selling them provided us with money in the short term to pay down debt and strengthen our balance sheet, which puts us in a better position to open some Save-A-Lot stores after a distribution center opens."

Supervalu does not currently license any Save-A-Lot stores in the Pacific Northwest, "but there are a number of retailers here that have expressed an interest in the format," Davis said. "Although we were already familiar with the concept because of our ownership relationship with Supervalu, the company held meetings in the area to expose the concept to others."

Davis said any Save-A-Lots that Tidyman's might operate would have to be built from the ground up because of the size difference between the two formats. Save-A-Lots are typically 25,000 square feet, while Tidyman's stores average 45,000 square feet.