LITTLE ROCK, Ark. -- Sales of kitchen tools and gadgets soared 10% at Harvest Foods here after price points were lowered and merchandise was strategically clip-stripped and J-hooked in grocery.
In March, the chain reduced its gadgets retail pricing 10% to 15%. Price points now run $1.19 to $4.69, with most sales falling between $1.19 and $3.19. Best sellers include nylon basters, $2.29; pop-up turkey timers, $1.79; and vegetable peelers, $1.29. The new program has enabled Harvest to reverse the flat gadgets volume it has experienced for the past year, according to Randy Martin, sales promotion coordinator at Harvest.
"This has helped us keep sales of items that are very high-impulse for a supermarket," Martin added.
Martin said the purpose of the price reduction was to bring Harvest's pricing closer to that of Wal-Mart. Harvest's gadgets are now only about 50 cents higher than Wal-Mart's, said Martin.
When it reduced its gadgets pricing, the 56-store chain also recasted 300 gadgets and a comparable number of kitchen tools in its 8 to 16-foot everyday gadget departments, a move that helped remove slower movers and duplications, according to Martin. As part of the remerchandising effort, Harvest shifted suppliers, going from a fully racked program to a drop-ship program. This lowered product costs by about 15%, Martin said. Store employees pack out the gadgets, which carry margins in the 40% and 50% range.
"This is part of an overall plan to improve our margins, lower our cost of goods and drive sales," Martin added. Harvest now follows the placement recommendations of Bradshaw International, Santa Fe Springs, Calif., which has helped create better merchandising opportunities, said Martin. The chain now features spaghetti scoops by spaghetti products; can openers by canned goods; peelers and vegetable knives near potatoes in produce; apple corers near apples; and cork screws by the drink mixes. The previous rack jobber used to decide what to cross-merchandise from its own list of items. Clip-stripped items are cross-merchandised at the end of each aisle, while J-hooks are spaced 8 feet apart.
