LAS VEGAS — Riesbeck's Food Markets, St. Clairsville, Ohio, has increased its price gap with Wal-Mart Stores over the past 18 to 24 months “because our prices were running too close to parallel,” Leo Braido, director of sales, marketing and store management, told a workshop audience here yesterday during the National Grocers Association's annual convention.
The gap, which originally was between 6% and 10%, is now between 10% and 15%, he said.
Wal-Mart takes between 60 and 80 items “and prices them at levels no one else can meet and still have any gross left, and retailers have to resist the temptation to focus on those items because you won't get close enough to make a difference," Braido said. "We believe the 10% to 15% gap is right for us."
He said Riesbeck's continues to run an everyday-low-price program, "but the money we save [from widening the gap] goes into offering additional values in our weekly ads" and to running one-, two- and three-day specials "to reinforce our value message."
Read More of Today's Headlines