Supervalu 'Hyper-Local' Effort Enlists Managers

Supervalu's store managers can double their incentive bonuses under the retailer's new "hyper-local" initiative, which turns control of certain merchandising displays and buys from central control to local store managers, Sherry Smith, Supervalu's chief financial officer, said in remarks at the Goldman Sachs Global Retailing Conference.

NEW YORK — Supervalu [4]'s store managers can double their incentive bonuses under the retailer's new "hyper-local" initiative, which turns control of certain merchandising displays and buys from central control to local store managers, Sherry Smith, Supervalu's chief financial officer, said in remarks at the Goldman Sachs Global Retailing Conference here Wednesday.

"We've always had [incentives] driven around the metrics of the store performance in terms of sales and earnings," Smith said, "but now if [store managers] exceed those earnings at a certain level, they have the ability to more than double the incentive they had in the past. So as they think about these different endcaps from what they're putting on display, it's not all just about what might drive the sales, but it is also what's going to help drive more profitable sales throughout the store."

The hyper-local program, launched in 1,100 Superalu-owned stores earlier this year [5], gives store managers control of 50% of the endcaps in their stores. Supervalu is supporting the effort through a "dashboard" tool that provides store managers with demographic information about their neighborhood including income demographics, ethnic makeup, and an estimate of the store's share in the market.

Managers can use this information along with their own observations to drive merchandising decisions, Smith said.