Independents Take Aim At Wal-Mart, Dollar General

Harps Food Stores. Riesbeck Food Markets. Coborn’s. Windham IGA.

These are only some of the retailers whose leaders trumpeted a message at last week’s NGA Show that really isn’t new but seemed fresh.

It goes like this: Independent retailers probably can’t win by fighting bigger competitors on the same playing field. They must instead reach for something different.

Bigger competitors in the spotlight included new formats from Wal-Mart and Dollar General. There’s an urgency because these formats come with expansion plans, but independents seem to have a handle on their rivals’ vulnerabilities.

At one NGA session, Steve Dillard, vice president, corporate sales and business development, Associated Wholesale Grocers, provided the lowdown on some new nontraditional format competitors.

He said Walmart Express exhibits sharp pricing and covers about 80% of needs, but is very limited in food variety.

Walmart Market, meanwhile — twice the size of Express and a successor to Wal-Mart Neighborhood Market  may be more formidable, he said.  Also important is Dollar General Market, twice the size of Dollar General’s regular units with more food, he said.

Independents have substantial opportunities against these formats by touting their variety, perishables such as meat and produce, event merchandising, dedicated associates, and community connections, distributors said.

The important point is to avoid getting pulled onto the same price battleground with these competitors. “We must resist the temptation to chase after other folks’ business plans,” said Leo Braido, director of retail, Riesbeck.

You could hear a bit more self-assurance and perspective from independents compared to the days when Wal-Mart first launched its supercenters and later its Neighborhood Markets, introductions that sent jolts through the industry.

“Fourteen years ago, when Neighborhood Market was introduced, Wal-Mart said much the same thing,” recalled Kim Eskew, president and COO, Harps. “It said it would open 200 of them a year in every small town in America. We were worried.”

But today there are fewer than 200. 

Perspective is a good thing, especially when it’s mixed with insights into other formats and a self-knowledge of one’s own strengths, as seems to be the case here.


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