ECR, CONSOLIDATIONS FOUND TO BOOST RESULTS

PHOENIX -- Improved operations and new business strategies helped supermarket operators fight market pressures and achieve better-than-average financial results in 1995, according to a study by Deloitte & Touche Consulting Group's Consumer Intensive Business Practice here.

r nontraditional food operators, the firm's seventh annual grocery industry study, "Benchmarking for Success," has found.

In the last five years, sales growth has slowed because of a mature domestic market, low population growth and low price inflation. Yet retailers and wholesalers had a 1% to 2% improvement in their gross profit margins, primarily due to ECR efforts and other cost-cutting measures designed to boost productivity, the report said.

High-performing wholesalers and retailers -- such as Supervalu, Richfood and Kroger Co. -- invested more than the industry average in capital expenditures, according to the study. Retailers' capital expenditures as a percentage of sales increased from 2.7% in 1994 to 3.2% in 1995, while wholesalers' cap-ex per sales decreased from 1.3% in 1994 to 1% last year.

Both sectors experienced an increase of days in inventory, which may be caused by the number of new products being produced and carried, the study said. But wholesalers and retailers had 35 and 27 fewer days in inventory, respectively, than the Standard & Poor's 500 median of 65.

Deloitte & Touche analyzed the financial performance of 120 companies from 1991 to 1995. Companies examined in the study included A&P, Albertson's, American Stores, Delchamps, Food Lion, Giant Food, Kroger Co., Pathmark Stores, Penn Traffic Co., Publix Super Markets, Safeway, Stop & Shop, Vons Cos., Weis Markets, Winn-Dixie Stores, Certified Grocers of California, Fleming Cos., Nash Finch, Roundy's, Spartan Stores and Supervalu.