SCHULTZ: CARD PROGRAM FATTENED PIGGLY WIGGLY'S SALES

SHEBOYGAN, Wis., -- Schultz Sav-O Stores here, the wholesaler-retailer hybrid behind the Piggly Wiggly "virtual chain," said it restored "positive momentum" in 1996 through its new electronic card-marketing program.t with a high level of customer enthusiasm and participation."The program is expected to be rolled out in all remaining stores by the end of 1997.The company said increases in same-store

SHEBOYGAN, Wis., -- Schultz Sav-O Stores here, the wholesaler-retailer hybrid behind the Piggly Wiggly "virtual chain," said it restored "positive momentum" in 1996 through its new electronic card-marketing program.

t with a high level of customer enthusiasm and participation."

The program is expected to be rolled out in all remaining stores by the end of 1997.

The company said increases in same-store sales and in the average transaction amount are a direct result of the club-card program. Benefits include "clipless" coupons, targeted savings throughout the store and special incentives to higher-level purchase customers. Other reward offers encourage shoppers to return to the store for future "Pig Deal" next-trip savings.

The card rewards loyal shoppers and also encourages less- frequent shoppers to increase their patronage of Piggly Wiggly stores.

According to the company's annual report, issued last month, business systems upgrades and new electronic card marketing dragged down results in 1995. But in fiscal 1996, ended Dec. 28, the company reported net sales of $453.9 million -- a 3.25% increase over 1995 net sales of $439.6 million a year ago.

Fiscal 1996 also saw record net earnings of $6.5 million and record earnings per share of $1.35, the report said.

The company said it achieved these improved sales despite the sale and conversion of one corporate store to a franchise, and the closing of two underperforming corporate stores. In 1996, the company also completed one remodel, two replacement franchise stores and one new market franchise store.

At year-end, Schultz operated 16 corporate supermarkets and serviced 68 independently owned franchise stores, all under the Piggly Wiggly banner. The conventional-style stores vary in size from 9,000 to 47,000 square feet.

In addition to the card-marketing program, the company emphasized fresh departments in 1996, including produce, meat, bakery and deli at both the wholesale and retail level. "Abundant selections of fresh fruit, vegetables, oven-fresh breads and rolls; donuts and sweet goods prepared daily; signature deli salads, pastas, soups and sandwiches; and a wide variety of fresh meats including restaurant-quality Certified Angus Beef, have helped make Piggly Wiggly 'the' place to shop," the report said.

"In many respects, the results for 1996 were very gratifying because they were achieved in a difficult operating environment," Dickelman said. "There is only one area that proved to be disappointing during the year, and that was the performance of our stock, which was down 5% from the start of the year despite posting gains in sales and earnings for each quarter of the year."

Dickelman said the balance of 1997 will see four remodeling/expansion projects, two franchise replacement stores and three new market stores, including the company's first new corporate store in six years.

The company said that in addition to expanding its card-marketing program, it will continue its aggressive marketing, merchandising and advertising programs, leaving stores to focus on customer service, operations and community involvement.

Also in 1996, the company launched a web site, at http://www.shopthepig.com, which provides information about store locations and hours, specials, promotional items, products recipes and contests. The web site also links to TicketMaster, which has ticket centers in more than 30 Piggly Wiggly stores.

Year-end results

52 Weeks 1996 1995

Sales $453.9 million $439.6 million

Change + 3.25%

Net Income $6.5 million $5.8 million

Change + 12%

Inc/Share $1.35 $1.20