WILLINGNESS TO TAKE RISKS

Some ideas may seem like pie in the sky when they are first mentioned, but time often turns them into reality.For example, although computer technology was still just a dream, speakers were talking about it years ago, including the following:A 1965 prediction by David Silverberg, general manager, Wakefern Food Corp., that total information-handling systems that link retailers and processors through

Some ideas may seem like pie in the sky when they are first mentioned, but time often turns them into reality.

For example, although computer technology was still just a dream, speakers were talking about it years ago, including the following:

A 1965 prediction by David Silverberg, general manager, Wakefern Food Corp., that total information-handling systems that link retailers and processors through a wholesaler or chain warehouse would one day become a reality.

A 1965 prediction that the supermarket of 1980 would feature a store-control center -- "an all-automatic control system, including checkout 'instant inventory' and reordering [and utilizing] ... closed-circuit television."

A 1967 prediction by Michael J. O'Connor, executive director, Super Market Institute, that automated checkstands "will not only total the customers' order at much higher speeds and without the errors that we experience today, but will also remember every item sold and place automatic orders with the warehouse for the replenishment of stocks."

A 1968 prediction that the industry would one day use a "plug-in, profit-predicting" computer software system with a basic data bank that could be used by any food distributor simply by plugging in his own variables.

OPERATIONS

Looking back over the past 50 years, several operating decisions seemed to be ahead of their time, including the following:

A test in 1962 by Ralphs Grocery Co. and Fleming Cos. "designed to result in automatic buying through electronic data-processing systems as part of a method of predicting sales on every product in a supermarket on a week-by-week basis" -- a forerunner of today's collaborate planning, forecasting and replenishment approach.

The opening by Food Fair Stores of gas stations at some locations in 1960, followed a year later by a test of a bowling alley. According to Louis Stein, Food Fair president, "We've always followed the theory that Food Fair should provide any service to consumers they could reasonably want from us."

A test by A&P of a coin-operated, dry-cleaning and laundry center in a store in Pensauken, N.J., in 1961.

Belying the introduction of combination stores as a 1980s innovation, the opening by Food Fair of a combination store in St. Petersburg, Fla., in 1957 that combined separate food and nonfood stores under one roof.

A suggestion by some financial institutions in 1959 that supermarkets accept credit cards -- an idea the chains regarded at the time as "completely foreign to the traditional concept of low-cost food distribution," SN reported.

RECYCLING REAL ESTATE

Recycling urban real estate to alternate formats is not a new phenomenon either, as demonstrated by these early examples from the pages of SN:

The opening by Grand Union in 1957 of a forerunner to the limited-assortment store, when it converted a small mom-and-pop location in New York City into a store with gravity-fed shelving stocked with high-turnover goods, mainly advertised brands, in a completely self-service format.

The conversion by Jewel Tea in 1959 of several small, unprofitable stores in Chicago into neighborhood food stores -- featuring lower prices than its conventional supermarkets -- rather than abandoning those locations and selling them to competitors when they proved too small for Jewel's traditional operations.

The introduction by Kroger Co. of a format called Warehousing Stores in 1965 -- years before Food 4 Less or other warehouse formats appeared -- that offered food, drugs and clothing at wholesale prices in a no-frills atmosphere.

AHEAD OF THEIR TIME

In other innovations that seemed to come years ahead of general acceptance:

Suggestions by various industry speakers in 1963 about direct product profit (DPP) -- a calculation that subtracts the cost of delivering product from gross profits, then adding back any cash discounts -- "[which] tells a significantly different and more accurate story about the worth of a product than do [such] traditional measures of value as gross margin, gross profit and gross profit per units of space."

A suggestion by distributors in 1959 for canners to ship products in multiple package units to save on handling costs in stocking shelves.

A proposal by industry thinkers, as early as 1962, that packaging and handling costs of high-volume grocery items could be cut by up to 50% by palletizing loads at the processing level.

An awareness by manufacturers in 1960 of the possibility they might someday have to buy their way onto supermarket shelves with direct dollar payments -- "a ticklish subject," SN said, "[that] is now in the whispering stage and not being discussed openly."

A prediction by the U.S. Department of Agriculture in 1966 -- long before consolidation became a way of life -- that the United States would become a nation of giant supermarkets, controlled by a handful of retailers and dominated by the major chains, with only those independents affiliated with wholesalers likely to remain healthy.

A prediction by a psychologist speaking at a 1966 industry meeting, which stunned his audience, SN reported, that change would become a way of life -- in large part because of increased leisure and the desire to better oneself in non-material ways; that the next generation would put increasing pressure on the industry to satisfy non-material needs, and that businesses would have to find ways to satisfy those needs. "Where once a plateau was reached after considerable change, the future will find no such leveling off before another advance," the speaker said.

In a similar vein, James M. Nicholson, a commissioner for the Federal Trade Commission, said in 1969 that consumers of the future would demand convenience and innovation.

"If the price on packaging is out of proportion to the value of the product, then consumers may exert massive pressures for change," he said.

A prediction by Arthur B. Larkin, president, General Foods Corp., in 1968 that supermarket operators of the future would have to be more socially involved "and actively strive to do something constructive about the almost overwhelmingly social and political changes taking place in today's society."