HOUSTON -- In an attempt to better serve the growing numbers of Hispanic shoppers in their operating areas, many retailers supplied by Grocers Supply Co. here and Los Angeles-based Certified Grocers of California are doubling the amount of space they devote to Latin American-made health and beauty care products.
Grocers Supply and Certified Grocers currently offer their retail customers a 4-foot Hispanic HBC set only, said Chris Hartmann, president of Midway Importing, also based here. Due to the success of the 4-foot set, the wholesalers will begin promoting an 8-foot section as well, Hartmann said.
Midway, which developed the 4- and 8-foot planograms and supplies the program to the wholesalers, is a service merchandiser specializing in Hispanic HBC. It has distribution agreements with Latin American manufacturers and with the Latin American divisions of U.S. companies like Pfizer, SmithKline Beecham and Bristol-Myers Squibb.
Hartmann said Midway will begin presenting the new 8-foot section to Certified Grocers and Grocers Supply retailers next month. Installations will begin sometime in the first quarter of next year.
Together, the two wholesalers supply about 3,000 supermarkets.
"The expansions are being necessitated due to the strong results of the 4-foot sections and the ability to fill more space with high-quality, proven-selling products than the 4-foot sections provide," Hartmann said.
In stores carrying the Hispanic HBC set, sales growth "has been 20% annualized over the last three to four years," he said. "Some years it's just been stupendous growth, 300% to 400%."
Buyers at Certified Grocers and Grocers Supply were unavailable for comment.
Retail customers with a concentrated Latino shopper base will evaluate the viability of the expanded set on a store by store basis, cutting it in "wherever they can justify taking something out," Hartmann said. In some cases, stores incorporate Hispanic HBC within a larger ethnic food department.
Midway conducts its own demographic research, by ZIP code, Hartmann added, so the company can target individual stores more effectively. "Our people know these stores like the back of their hand."
Included in the new 8-foot set will be more natural remedies containing things like cactus extract, aloe vera and chamomile, and all-natural weight-loss supplements, Hartmann said. "Home remedies are huge with our consumer base."
The enlarged set will also include more Derman brand foot-care products and Belleza Latina, a major new skin care line specially designed for Latin women, Hartmann said. Backing the Belleza Latina launch will be high-profile advertisements on the Univision and Telemundo television networks, on Hispanic radio stations and in Spanish-language magazines and newspapers. "The minute we get distribution, they will turn on strong, strong support."
(Midway's in-house marketing agency will be coordinating Belleza Latina's U.S. ad buy, Hartmann said.)
Both Certified Grocers and Grocers Supply will also be promoting two Hispanic HBC lines per month in their circulars, Hartmann said.
Other Midway clients that have had the larger Hispanic HBC sets in stores for some time, with strong results, include H.E. Butt Grocery Co., Southwest Supermarkets, Wal-Mart Stores and Kmart, he noted.
According to the U.S. Census Bureau, Hispanics are the fastest-growing demographic segment in the United States. California's Hispanic population, for example, is expected to double between 1995 and 2025 and make up one-third of all California residents by the end of next year.