Why do RICH towns have so many obsolete grocery stores?

This is the place for general and miscellaneous posts on topics which might extend past the boundaries of any specific region.

Moderator: Groceteria

Post Reply
Ephrata1966
Senior Member
Posts: 549
Joined: 29 Nov 2008 13:45

Why do RICH towns have so many obsolete grocery stores?

Post by Ephrata1966 » 19 Aug 2011 02:16

Has anyone noticed this? Acme/Super Fresh on the Pennsylvania Main Line (Philadelphia metro area), A&P in northern New Jersey (New York suburbs), and Safeway in parts of San Francisco are examples of that trend. I guess Whole Foods and similar chains (which often have small stores by chain standards) have taken over the grocery niche in these areas. But many of the traditional chains' stores here even today are tiny 1950s stores that have never been expanded! These stores were obsolete even by late 1960s/1970s standards! The first gourmet supermarket I ever went to was a "Rice Epicurean" store in Houston which opened in 1990. Nevertheless, the grocers in that city always seemed up to date. And I never heard of Whole Foods until I went to LA in 2000.

pseudo3d
Senior Member
Posts: 295
Joined: 24 Sep 2012 00:04

Re: Why do RICH towns have so many obsolete grocery stores?

Post by pseudo3d » 27 Sep 2012 15:40

By "rich" cities, I assume you mean very large cities like Houston. The answer is this: competition. Houston's grocery market is fragmented and cut-throat. Let's take Houston. Currently, Food Town, Whole Foods, Rice Epicurean, Fiesta, H-E-B, Kroger, Randalls, and Walmart all command a majority of market share. Naturally, a few have fallen.

Safeway once held a majority of stores in Houston (the "old" pre-late 1980s Safeway) and grew to a nice size when they took over Weingarten's when the company decided to go into real estate. But the Weingarten's stores were mostly out of date. When all those became AppleTree circa 1988, the company was stuck with debt and collapsed.

Albertsons and Food Lion took strides in the 1990s and 2000s--the problem was their stores were sub-standard (both of them) and both pulled out within a few short years. Randalls is a bit of anamoly--it was bought by post 1980s Safeway, and forced their inferior overpriced product on the city and market share took a huge hit. Dominick's was bought at the same time and also took similar falls.

rich
Senior Member
Posts: 564
Joined: 15 Nov 2005 20:51
Location: Washington, DC

Re: Why do RICH towns have so many obsolete grocery stores?

Post by rich » 27 Sep 2012 17:37

Land costs, density, and figuring out how to get profitable high volumes from small stores. The "Soviet Safeway" (so named because of long lines), a small (probably 10-12K sf) store that probably dates from the 40s in DC used to have the highest sales/sq ft of any store in the chain. It now has more competition, but still does huge volume and, as an occasional shopper there, I'm always surprised at what I can find. It's hardly obsolete. It services a well-off area and is in walking distance of thousands of people. Safeway recently closed an even smaller store a half mile away, because the landlord wanted a different kind of tenant and that store had much smaller volumes. A small store can do well in a densely populated neighborhood, esp. with well-off shoppers. There's a Jewel-Osco on the mid-North Side of Chicago that's probably 20-25K sf and it does excellent volume, with exactly that kind of clientele. Harris-Teeter has a small store prototype that was successful in Charlotte with a 13K sf unit--they used it as a base for a store they had in Decatur (inner ring Atlanta suburb) that was one of their best performers, before they left the market. Not everyone needs a 60K sf store and most people's core purchases can be accommodated by something smaller.

Post Reply