PATHMARK CUTS PRICES ON 6,000 HBC ITEMS

CARTERET, N.J. -- Pathmark here began a new everyday-low-price initiative by cutting prices on 6,000 health and beauty care items late last month.The program is a response to customer feedback and is an effort to keep pace with a competitive market, said Rich Savner, spokesman. The new strategy recognizes that HBC categories are very aggressively merchandised both in the supermarket industry and by

CARTERET, N.J. -- Pathmark here began a new everyday-low-price initiative by cutting prices on 6,000 health and beauty care items late last month.

The program is a response to customer feedback and is an effort to keep pace with a competitive market, said Rich Savner, spokesman. The new strategy recognizes that HBC categories are very aggressively merchandised both in the supermarket industry and by other competitors, he said.

"We got enough customer feedback to be able to say that this is a trend we need to address. Hence our decision to become a more aggressive player within the HBC category."

The price reductions follow six months of research during which the chain conducted focus groups, monitored customer comment cards, and studied its competitors, he said.

The price reductions were announced in a circular distributed in stores Feb. 27. The message will be supplemented in newspaper advertisements, on the radio, and on the company's Web site, Savner said. There will also be in-store signs. The low-price initiative will be an ongoing program in all 143 Pathmark stores in New York, New Jersey, Pennsylvania and Delaware, Savner said.

"Hopefully, this initiative will not only make the existing customer base that Pathmark serves more satisfied by addressing their health and beauty care needs, but will also attract new shoppers to the company."

HBC categories are very important to Pathmark, said Gary Giblen, senior vice president and director of research for C L King Associates, New York. Typically, HBC is the strongest suit of clubs and general merchandise retailers. Supermarkets need to regain ground in this area, he told SN.

"Pathmark is the No. 1 supermarket for HBC in terms of being perceived as a destination store where they have a wide assortment and good prices," Giblen continued.

For Pathmark and Wakefern's ShopRite stores -- Pathmark's main competitor in the New York/New Jersey markets -- this is a very serious issue, Giblen said. Club stores have been building their customer base and putting up new stores. While it is still in the future, Wal-Mart's move to build smaller stores that will allow its infiltration into dense areas like New Jersey will have an impact on food retailers, he said.