QFC UNIT MOVES TO INTEGRATE NATURAL FOODS 2004-05-03 (2)

MINA WILLIAMS

SEATTLE (FNS) -- Kroger's Washington state QFC stores appear to be making an about-face when it comes to positioning natural products.

QFC executives have brought natural food items back into the center store fold, taking care to offset their presence with on-shelf signs.

Following an extensive remodeling effort of the operator's University Village unit, gone is the boutique department featuring natural items ranging from frozen and refrigerated foods to canned and boxed foods, baby supplies, home cleaning items and paper goods. The same items have been dispersed throughout Center Store within the appropriate department, then framed with signs affixed to the grocery shelves reading "Naturals" to the right and left.

The changes certainly reflect the advances manufacturers, retailers and consumers have made in the burgeoning natural/organic food category. Officials of QFC, a division of Cincinnati-based Kroger Co., declined to comment on the store changes.

In the snack food aisle, locator signs indicate "natural chips" and offer Erin's gourmet popcorn and Smartfood items along with Frito Lay natural items such as Tostitos, Cheetos and Doritos. As with other categories, the natural products are segregated mid-aisle, occupying a vertical display within the chip set.

Other natural product presentations offer the usual and customary brands consumers expect to see.

The 4-foot natural cracker presentation showcases Barbara's, Annie's, Guiltless Gourmet and Hain. The 3-foot candy selection taps Newman's, Barbara's, Hidden Valley and Country Choice. The 12-foot soup assortment ladles up instant cups, broth, aseptic packs, canned selections and gravy from Pacific, Hidden Valley, Amy's and Imagine.

One of the deepest assortments in QFC's Naturals sets could be the 20 feet of cereals from companies like Barlen's, Kashi, Arrowhead Mills, Nature's Path and Cascadian Farms. The 6-foot boxed dinner grouping also positions a myriad of possibilities for shoppers. Stockkeeping units of risotto, macaroni and cheese, vegetarian chili from Fantastic, Annie's, Barbara's and Tasty Bite sit alongside four SKUs of Zone offerings. Natural personal care items occupy 16 feet of shelf space, bracketed with the signature signage, to draw attention to toothpaste, lotions, creams, shampoo, deodorant and bath salts.

Even canned vegetables are punctuated by the in-line merchandising scheme with a set of natural choices ranging from tomatoes and beans to asparagus and sauerkraut.

Pasta, pasta sauce, juice, salad dressings, jams, sauces and tea are also segregated into natural sets within their categories on the food side of Center Store.

On the nonfood side, consumers will find eight feet of paper products; four feet of baby care items ranging from food, formula and diapers to soaps and wipes; and four feet of household cleaning and laundry supplies grouped between the Naturals signs.

Soy and rice milk command their own 8-foot section as do pre-packaged nuts, seeds and dried fruit.

Not all of the segregated Naturals sets are clear-cut. Baking mixes along with six SKUs of commercially baked bread share a set with Atkins, Slim Fast and low-carb products.

Another new merchandising highlight the University Village unit employs is bump-out semi-circular shelves running the entire height of the dry grocery shelving. These bump-outs significantly increase the visibility of dense categories including olive oil, vinegar, Mexican food, pasta, Asian sauces, pasta sauce, salad, dressing, barbecue sauce, and jams and jellies.

QFC additionally puts these bump-outs to work in the coffee/tea aisle, which in this Seattle unit runs the length of the store. The day of SN's tour, pre-bagged Tully's coffee occupied one bump-out, while another showcased high-margin coffee equipment including press-style coffee makers, cup warmers, travel mugs, stainless steel espresso shots and frothing pitchers.

In QFC's deli department, a walk-around merchandiser dubbed "All Natural Choices" offers refrigerated and hot foods within its 6-by-10 footprint. In the refrigerated, grab-and-go section, a selection of pre-packaged pizza, burritos, garden salads and Moosewood prepacked soups are presented on one side of the merchandiser.

On the other side, hot foods are available. Whole roasted chickens alongside pre-packaged hot turkey and pork roast slices were the menu items the day SN visited the store. At one end, soups are offered hot and ready to be dished out by the customer. On the other end, four hot selections positioned within restaurant-quality buffet chafing dishes are available at $7.99 per pound. The day of SN's visit, turkey with gravy, mashed potatoes and maple glazed yams comprised the menu.