FALL SALES RESULTS WILL HINGE ON PROMOTIONS

Many retailers around the country are looking to mid-autumn promotions to spur sales after an expected slow beginning to the new season, SN discovered in a survey.Results from the summer were mixed, with some stores reporting their best seasons ever, while others called the season just ended one of their worst.Supermarket operators are also planning to try a number of tactics to cope with consumer

Many retailers around the country are looking to mid-autumn promotions to spur sales after an expected slow beginning to the new season, SN discovered in a survey.

Results from the summer were mixed, with some stores reporting their best seasons ever, while others called the season just ended one of their worst.

Supermarket operators are also planning to try a number of tactics to cope with consumer fears about a possible breakdown of the food-supply chain caused by the Y2K bug.

Tres Lund, president, Lund Food Holdings, Edina, Minn., is looking forward to a strong autumn. "October to December is our big quarter for specialty items," he said.

This year, he added, the company will be launching a storewide "whole health strategy," beginning with the mid-October opening of a remodeled store that has been closed since Aug. 7.

He said the strategy will result in "an increased push and promotion of organic and herbal products," with these items becoming "their own department within the store."

"It will take us the better part of a year for this program to hit all 19 stores," he added.

The summer was also a good season, Lund said. Same-store sales rose 6.9%. Lund said his chain featured a very successful summer promotion with chefs grilling seafood in front of its stores.

Lund said he is also preparing to take steps to calm consumers about Y2K issues. In October, his stores will be distributing material prepared by the Food Marketing Institute, Washington, that Lund noted, should "discourage concerns."

Macey's, Sandy, Utah, had a summer promotion in which each week it offers bargain prices on cases of goods on display in the store's parking lot. This summer's case-lot sale "was the strongest we've ever seen," said Kenneth Macey, the store's president. "Sales were way up."

These sales numbers were fueled at least in part by the high level of Y2K concerns among Utah shoppers. "It was not so much a frenzy as an attitude of preparedness," said Macey. "People were buying staples and good, everyday food items."

Macey said he'd had particularly high hopes for two truckloads of electrical generators the store was putting on sale in August. "I thought they would just fly out of here," he told SN. "They did not. We really laid an egg." Macey said the store will eventually sell the generators.

He also said that after the strong summer sales will probably fall off in September and October, at least until Halloween. "Halloween is big, really big here," he said. "We're ordering truckloads of candy."

Meanwhile, in the Midwest, Phillip Quillin, president of Quillin's, La Crosse, Wis., said he was expecting a slow fall after "an excellent summer."

"It was a good summer weather-wise," he explained. "People were active and doing things, and what that happens they tend to eat more." On the banks of the Mississippi, La Crosse is a regional center for water recreation drawing both locals and tourists, he added.

Fear of the approaching millennium is not much of an issue for his shoppers, said Quillin, who credits the local media with doing a lot to calm consumer anxieties.

Quillin said he does not have particularly high expectations for the beginning of autumn. "Fall is not our best season," he said. "The kids go back to school and eat school lunches. There's just not as much traffic. I just hope this fall is better than last fall."

To celebrate the season, and perhaps even boost sales, Quillin's will be holding its annual Octoberfest, a promotion focused on those twin Midwestern delicacies, bratwurst and beer, the perfect accompaniments to Green Bay Packers football. "The store does get awfully quiet on Sunday during Packer games," said Quillin.

In southern California, a shrinking number of supermarket chains are facing an increasingly competitive environment, said Ty Hitt, chief financial officer at K.V. Mart Co., Carson, Calif.

"On a same-store basis, the summer was down about 1%" for his company, he told SN. The reason for the decline, he said, was "things just haven't settled down" following the acquisitions earlier this year of Fred Meyer, Inc., Portland, Ore., by Kroger Co., Cincinnati, and of American Stores, Salt Lake City, by Albertson's, Boise, Idaho. Although none of the these companies are California-based, the mergers leave Albertson's and Krogers with a strong presence in the state.

However, Hitt said K.V. Mart is "projecting sales increases in the next fiscal year," which begins in October. Part of this will be due to challenges faced by the competition. The large chains, he noted, are heavily saddled with debt. "The easiest way to pay off debt is to cut payroll costs or increase operating margins," he said. In other words, K.V.'s rivals will have to cut back on service, increase prices or due both to satisfy their creditors.

Another reason things are looking up for K.V., according to Hitt, is the firm's recent expansion. "We've gone from 18 stores to 33 in just a few months," he said. "That should better enable us to compete."

While Hitt does not expect a Y2K crisis, K.V. is taking steps in case its shoppers do. "We are stocking more bottled water than usual in our warehouse," he said.

In the East, the summer was not kind to food retailers, said Joseph Azzolina, president, Food Circus, Middletown, N.J.

"The summer was good until August, and then the bottom dropped out," complained Azzolina, who said he has heard similar complaints from other New Jersey supermarket operators. "August was lousy, and September has been lousy. I don't know why."

Azzolina said he does not expect business to turn around in the fall. "For Thanksgiving, we're going to give away turkeys," he said. "The pattern hasn't changed. Everybody gives turkeys away, and nobody makes any money."

He also said he hopes his customers don't start stocking up on staples as the millennium draws to a close. "It throws off the whole supply chain," he said. "We run on flow. The last thing you want is to find yourself out of stock."

"But if they just bought a little bit more each time they shopped," he added, "that would be good."