INDIANAPOLIS -- Marsh Supermarkets here said an effort to freshen up its stores has resulted in an increasingly positive sales trend, although comparable-store sales were still negative for the first quarter ended June 19.
The refresh program, encompassing four stores so far, involves resetting the store planogram to maximize the visual impact of product, generate more impulse sales, and give better exposure to private-label merchandise, Don E. Marsh, chairman and chief executive officer, said in a recorded call discussing the company's financial results for the quarter.
The result of the refresh program, he said, has been "an increasingly positive trend," adding that 26 more stores are scheduled to be refreshed during the balance of the fiscal year.
Marsh also said the company intends to open additional "lifestyle" stores, "which are producing positive feedback despite a challenging economy." The company plans to break ground in September for its first store in Chicago, he added. The store will feature the company's lifestyle design, in which produce is located in the center of the store and other categories are segregated around the perimeter.
Marsh said the company is evaluating its promotional programs to make a greater investment in price as part of an effort to develop greater customer loyalty.
Sales rose 6.8% to $399.9 million for the 12-week quarter, and comparable-store sales at supermarkets and convenience stores, excluding gasoline, declined 0.4% -- an improvement from the comp decline of 3.3% in the fourth quarter, the company pointed out. Net income in the quarter jumped 28.6% to $1.6 million.
"We are encouraged by the improving economy," Marsh said, "but we believe Indiana is lagging behind the U.S. recovery because of the heavy manufacturing base in central Indiana, which experienced significant job losses and plant closings in the past two years.
"Marsh has a competitive advantage over other supermarkets and supercenters by offering superior service and quality, combined with a pleasant and convenient shopping experience, [and] in an improved economy, these strengths will drive sales and profitability."
During the quarter, the company said it converted one Marsh location in Greenville, Ohio, to the LoBill Foods banner and opened a new casual, quick-service restaurant called Trios Di Tuscanos, which is adjacent to a new McNamara Florist location, "[so] the combined units utilize the floral shop to provide a unique visual effect," Marsh said.