All hands on deck for Smart & Final holiday push

In support of stores anticipating their second biggest food shopping day of the year, around 200 employees at Smart & Final’s corporate offices reported to work at its stores Wednesday, including its top executives.

“Some people need to stay back and turn on the lights, maintain the help line and keep the systems running,” CEO Dave Hirz told SN in an interview Wednesday, “but everyone else is pitching in at the stores. It’s a lot of fun.”

The event is part of a twice-yearly “Engagement Day” supporting the Commerce, Calif.-based retailer’s core value of teamwork, explained Hirz, who initiated the event upon taking the role as CEO six years ago. A similar event takes place each July 3, the only single day of the calendar year to do more sales than the day before Thanksgiving at Smart & Final, he said.

Hirz, reached early Wednesday from California, said he expected to be helping store associates keep stock up in the company’s bakery aisle, where he expects high volumes of items like sugar, flour and poultry spices to fly off the shelves as shoppers stock up for Thanksgiving meals. He noted the top selling item at Smart & Final would likely be five-gallon containers of peanut oil, a unique bulk item typically stocked for the company’s business customers that becomes a destination buy with consumers shopping for special occasions.

In many markets, those shoppers will arrive Wednesday to find a different Smart & Final store than the one they may have experienced in previous holidays. That’s a result of Hirz’s ongoing recasting of legacy 17,000-square-foot Smart & Final stores with the 30,000-square-foot Smart & Final Extra! format, which combines the latter’s club-pack and business-item core selections with about 6,000 additional household items including produce, transforming the store into a more direct competitor to supermarkets.

This transformation kicked into high gear this year as Smart & Final opened 39 new Extra stores, including 33 former Albertsons and Haggen supermarket locations acquired during Haggen’s bankruptcy. The transformations have triggered some cannibalization of sales in existing Smart & Final units, Hirz acknowledged, but are presenting area customers with more convenient locations they can shop more often.

“It’s a store you can shop at two times a week vs. two times a month,” Hirz explained.

Hirz is a veteran of the Southern California food retailing scene, having spent more than a decade at Food 4 Less and its eventual acquirer Kroger, which installed Hirz as president of its Ralphs division there. He described the market there as one in a constant state of flux, having absorbed and then rejected a new concept in Fresh & Easy, while seeing a steady rise in discount operators including Walmart and Aldi.

Hirz remarked in an earnings call last week that Aldi had so far opened 22 units in direct competition with Smart & Final, estimating that those stores on average were chipping $1,000 to $2,000 in weekly sales from the affected stores.

He attributed the modest impact in part to Smart & Final’s unique offering. “Around 42% of our sales come from items my competition isn’t carrying.”