Grocer Restricts Lottery Sales on Moral Grounds

LAS VEGAS — An executive at a chain of Hispanic supermarkets said Monday he refuses to sell lottery tickets or cigarettes and restricts SKUs of beer and liquor on moral grounds.

“Ours is not a transactional business — it's a people business,” Juvenal Chavez, president of Mi Pueblo Supermarkets [3], San Jose, Calif., told a workshop audience here during the National Grocers Association annual convention. “I want to create an environment in which customers feel comfortable, and I made a decision years ago to remove anything that distracts customers from shopping the store.”

Because so many of the stores' customers are poor and often cannot afford the assortment of fruits and vegetables they want to buy, Mi Pueblo cuts produce into smaller portions and bags up a variety pack to make his customers' money go further.

“It costs me 20% more labor, but I get a higher gross at the same time I make the customer happy.”

Joining Chavez on a panel discussing how to market in low-income areas was Pat Burns, president of The Fresh Grocer/Great Valu, a 12-store operator in urban Philadelphia, who said his stores also bag different produce items and sell them for $3 apiece, “so customers know the cost coming in,” which helps them budget their shopping trip, he noted.

A third panelist — Rob Santoni, owner of Santoni's, a single-store operator in Baltimore, Md. — allows customers to place orders at several sites in the city, including a library and a senior housing unit - and he delivers products to those locations. Burns said he offers a free ride home to customers who spend $50, “which enabled us to triple our average order size to about $80 because now they can carry four or five bags instead of just two. And it also means they shop less at bodegas now that they can carry more bags.”

Chavez said he also offers free rides to customers but does not set a minimum “because it could be considered offensive to some shoppers.”